San Antonio Retail asking rents rise to all-time high.
VACANCY RATE TIGHTENS TO 5.2% Demand for San Antonio retail space (1.1 million sq. ft. of net absorption) outpaced supply (747,000 sq. ft. of deliveries) during the first ten months of 2021 in the San Antonio metro. This is the first time since 2018 that the amount of net absorption was greater than the amount of square feet delivered from January through October. Rent growth has yet to decline since the beginning of the pandemic. Since this time last year asking rates are up 6.1% to an all-time high of $17.06 per sq. ft. The effective rent growth may be greater as well, as concessions may have started to dissipate as the economy recovers.
HEALTHY LEASING ACTIVITY The San Antonio retail market has recorded 2.1 million sq. ft. of leasing activity—which is comprised of both new leases and renewals—from January through October 2021, an equivalent amount from this time last year. Significant lease transactions in 2021 include: Floor & Decor leasing 91,031 sq. ft. at 13905 North I-35 Freeway in the Northeast submarket in May; LA Fitness inking a deal for 50,000 sq. ft. at 21003 Encino Commons—The Pinnacle at Encino Commons in the Far North Central submarket in September; and Crunch Fitness taking 30,000 sq. ft. at 8425 Bandera Road—Bandera Festival Center in the Northwest submarket in July.
RETAIL AND ROOFTOPS Home sales leveled out as summer ended, while still moving at a steady pace for this time of year. September reported 3,651 homes sold, no change from this same month last year according to the San Antonio Board of REALTORS. Both average and median sales prices showed increases of 15%, with an average sales price of $351,379 and a median of $296,900. The month ended with 1.8 months of inventory available, indicating a continued sellers’ market.
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