ARLINGTON, Va., August 13 — U.S. retail projections are expected to remain broadly balanced through 2027, according to a just-released forecast from CoStar, the leading global provider of online real estate marketplaces, information and analytics in the property markets.
National retail vacancy is anticipated to remain at current levels in the near term before rising minimally over the medium term, while rent growth is expected to strengthen modestly as limited new supply and healthy tenant demand continue to support occupancy.
“The updated forecast reflects stronger-than-anticipated demand earlier this year,” said Brandon Svec, national director of retail analytics at CoStar Group. “Store openings continue to outpace closures, known closure announcements have fallen to their lowest level in several quarters, and retailers have continued to backfill vacant space more quickly than expected. In addition, the pipeline of announced, but not yet opened, stores remains elevated, providing a continued source of future demand over the next two to three years.”
“Although the forecast has improved, risks remain tilted modestly to the downside,” said Svec. “Higher energy prices resulting from geopolitical conflict involving Iran could weigh on consumer spending and retailer profitability. Additional risks include renewed tariff uncertainty, further labor market deterioration leading to slower wage growth, and weaker population gains due to tighter immigration policies. Each could reduce retail sales growth and slow tenant expansion plans over the forecast period.”