Friday, April 24, 2015

Philadelphia Retail Vacancy Increases to 6.0%

The Philadelphia retail market did not experience much change in market conditions in the first quarter 2015.

The vacancy rate went from 5.8% in the previous quarter to 6.0% in the current quarter. Net absorption was negative 637,609 square feet, and vacant sublease space increased by 48,894 square feet. In fourth quarter 2014, net absorption was negative 62,004 square feet.

Tenants moving into large blocks of space in 2015 include: Under Armor moving into 16,348 square feet at 1529 Walnut St; AutoZone moving into 15,874 square feet at 200 S Best Ave; and La-Z-Boy Furniture moving into 14,800 square feet at 101 Ironlake Blvd.

Quoted rental rates decreased from fourth quarter 2014 levels, ending at $13.88 per square foot per year.

A total of 19 retail buildings with 138,704 square feet of retail space were delivered to the market in the quarter, with 696,250 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 6.0% from the previous quarter, with net absorption positive 15.41 million square feet in the first quarter. Average rental rates increased to $14.96, and 604 retail buildings delivered this quarter totaling almost 13.3 million square feet.

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