Colliers released its U.S. Retail Market Statistics report for the first quarter of this year, and it is refreshing to see that retail leases appear to be back in full bloom on a grand scale in the country. The national retail vacancy rate dropped 10 basis points during the first quarter and stands at 4.5%.
Not surprisingly, many of the American cities that are showing high retail vacancy rates, such as Chicago, Los Angeles, Washington D.C. and New York, are those that have public policies in place that are counterproductive to helping retailers. One of the more glaring examples is the policy of releasing criminals participating in “smash and grab” retail store thefts which, in turn, prevent future retail tenants from wanting to rent in urban areas with these lenient-on-crime policies. A rise in shoplifting incidents even prompted Walgreens to close 22 of its stores in California’s Bay area metro region.
Luckily the tide may be turning as the public becomes more aware of these practices and consequently takes action to resolve them. For example, San Francisco’s citizens recently voted to recall the city’s district attorney who had been releasing those criminals that had repeatedly shoplifted up to $950 worth of merchandise at a time from the city’s stores. Hopefully as these policies begin to improve, and as more workers return to the urban office environment in full force, then, perhaps, these cities will once again thrive with lower retail tenancy rates.
