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Q&A: Houston Retail Market and COVID
Despite the dark clouds of COVID, there are some bright spots, says Kyle Knight, SVP with Weitzman’s Houston office. He recently weighed in on COVID’s impact on local retailer operations.
Q: What’s the current state of the market?
A: Houston reports lower retail occupancy of 93 percent compared to 95 percent in 2019. The drop occurred largely due to closings from retailers such as Sears, already struggling before the pandemic. Even with the decline, Houston’s market occupancy is healthy.
Q: What helped stabilize occupancy?
A: After an initial pandemic-induced slowdown, leasing activity picked up. We saw a number of vacancies backfilled by concepts like Target, and even restaurants are expanding into quality second-generation spaces. Record-low 2020 construction (695,000 square feet) also helped avoid a space overhang, and a combination of flexible landlords, PPPs loans and retail innovations helped keep tenancy in place.
Q: What do you see for 2021?
A: The outlook is cautiously optimistic, especially in light of the COVID-19 vaccine and our strong housing market. We expect to see growth pick up through 2021 and into 2022.
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