Friday, January 24, 2014

Philadelphia's Retail Vacancy Stays at 6.3%

The Philadelphia retail market did not experience much change in market conditions in the fourth quarter 2013. 

The vacancy rate stayed at 6.3% in the current quarter. Net absorption was positive 616,052 square feet, and vacant sublease space decreased by 109,997 square feet. In third quarter 2013, net absorption was positive 416,003 square feet. 

Tenants moving into large blocks of space in 2013 include: Wegmans moving into 125,047 square feet at 500 Montgomery Mall; Restaurant Depot moving into 72,643 square feet at 2950 Roberts Ave; and ShopRite moving into 71,900 square feet at 3450 Fox St. 

Quoted rental rates decreased from third quarter 2013 levels, ending at $13.75 per square foot per year. 

A total of 15 retail buildings with 252,369 square feet of retail space were delivered to the market in the quarter, with 282,479 square feet still under construction at the end of the quarter. 

This trend is compared to the U.S. National Retail vacancy rate, which decreased to 6.6% from the previous quarter, with net absorption positive 21.28 million square feet in the fourth quarter. Average rental rates increased to $14.59, and 563 buildings delivered to the market totaling more than 10.4 million square feet.

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