Retail: Absorption Lower, Vacancy Tight

The closing of several big box retailers reduced absorption in the Austin retail market in Q3 2017. The shuttering of Bealls, Hastings, Gander Mountain and Office Max ended up totaling 88,000 square feet of negative absorption. Despite that, Class A occupancy continued tight, sitting at 98.1%, according to CBRE metrics.

CBRE’s Q3 Marketview Report also noted that it wasn’t just Class A space that retailers were snapping up. Limited availability means the overall occupancy for retail space stands at 96.2%, the highest retail occupancy in Texas.

Meanwhile, the pipeline is busy, with developments in East Downtown Austin (Plaza Saltillo) and West Austin/Dripping Springs (Belterra Village) underway. Both developments are focused heavily on “experiential” types of retail, including entertainment and restaurants, the CBRE report said.

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