The Weitzman Group has released retail real estate statistics for the first six months of 2016. The in-depth study analyzes market activity in Dallas-Fort Worth, Austin, Houston, and San Antonio.
Comparing the major markets, Austin, with an inventory of 47.9 million square feet, has an occupancy of 86 percent; Dallas-Fort Worth, with 194 million square feet, is 91.6 percent occupied; Houston, at 152 million square feet, is 95.5 percent occupied; and San Antonio, at 44.9 million square feet, is 94 percent occupied.
In terms of retail construction, Austin is on track to add 700,000 square feet this year, after completing 900,000 square feet last year; DFW should add 2 million square feet, on top of the 2.7 million square feet delivered in 2015; Houston will add 2.9 million square feet, after also adding 2.7 million square feet in 2015; and San Antonio should add 1.3 million square feet, compared to the 900,000 square feet developed last year.
Drilling down into Dallas-Fort Worth, The Weitzman Group says it’s entering a “third year of record stability as population, job growth soar and construction peaks.” The current occupancy is second only to year-end 1984, when it stood at 92 percent.
Occupancy gains in the past year were driven by new construction for anchors, limited store closings, and new retailer and restaurant tenants entering the market. They include H&M, which opened in downtown Fort Worth and also leased space in that city’s Hulen Mall, and WinCo Foods, which took space in Carrollton’s Trinity Valley and Bardin Place on South Cooper Street in Arlington.
Lease rates remain stable, after several years of increases, The Weitzman Group reports. Class A rates range from the mid-$20s to high $30s per square foot, with some spaces in the best-located projects going for $45 per square foot or higher.
