TAMPA, FL — In the Tampa market, new space coming online amid a reduction in demand raised the vacancy rate to more than 8 percent in the first quarter, according to a second-quarter Retail Research Report by Marcus & Millichap, the nation’s largest real estate investment services firm.Further increases in vacancy are expected through the rest of 2009, as declining employment is forecast to reduce retail spending 11 percent, resulting in additional store closures.
“In the investment arena, only a few deals have been transacted this year,” says Bryn Merrey, (top right photo) regional manager of the Tampa office of Marcus & Millichap. “With investors looking for distressed properties at discounted prices, there appears to be little interest in stabilized assets with solid tenants, and little inclination to sell.”
Following are some of the most significant aspects of the Tampa Retail Research Report:
· An additional 50,000 jobs will be eliminated in 2009, following the loss of 46,400 positions last year. Job cuts this year will reduce total employment by 4.2 percent.
· Builders will deliver 1 million square feet of space in the market in 2009, including a 353,000-square foot IKEA in east Tampa. Last year, 3.6 million square feet was put into service.
· An expected reduction in retail spending will lead to more store closures and halt expansion by other merchants, increasing vacancy 250 basis points to 10.3 percent this year. Negative net absorption of 2.5 million square feet will be recorded. The vacancy rate rose 140 basis points in 2008.
· A decline in consumer spending will reduce space demand, resulting in a 6.3 percent drop in asking rents to $14.39 per square foot. Effective rents will post an 8.4 percent decrease to $12.52 per square foot in 2009.
For a copy of the complete Tampa Retail Research Report, as well as reports on other markets nationwide, visit our website at http://www.marcusmillichap.com/.
Press Contact: Stacey Corso, Communications Department(925) 953-1716
