Colorado-Real-Estate-Journal_327951

Colorado retail fundamentals remain strong INSIDE Post-pandemic capital shifts toward retail – Jason Schmidt Capital Market Single-tenant market adjusts as demand pulls back – Zach Wright Single-Tenant PAGE 10 Cautious optimism reigns in NoCo retail market – Ryan Schaefer Northern Colorado PAGE 8 February 2023 PAGE 4 T he fundamentals of the Colo- rado retail market remain strong amid a slowing economy. According to CBRE research, the metro Den- ver market recorded over 333,000 square feet of net absorption in fourth-quarter 2022, ultimately pushing the year-to-date total to over 903,000 sf, a 51% increase from fourth-quarter 2021 and the second consecutive year of positive absorp- tion. Direct vacancy declined 50 basis points year over year to 6.3%, and total availability declined 100 basis points to 7%, driven largely by the lack of new deliveries. On a national level, the retail availabil- ity rate compressed to 4.9%, again driven by consis- tent demand and a shortage of new construction. The metro Den- ver retail devel- opment pipeline slowed to just over 692,000 sf of space under con- struction, an 8.6% decrease year over year. Metro Denver posted a delivery volume of only eight retail build- ings totaling 90,000 sf in fourth- quarter 2022. Suburban markets remain the focus of most retailers and developers, given their appeal- ing spaces that allow size and build-out flexibil- ity. The retail sec- tor will continue to be tested by a lull in delivery of new product. End- of-year figures from 2022 show net absorption of over 903,000 sf, while for the same period, the mar- ket delivered only 407,000 sf of new space. Given the supply-demand imbalance, the sec- tor fundamentals will likely remain healthy moving forward. Total retail sales activity for metro Denver dipped slightly in fourth- quarter 2022 with a volume of $350.2 million, a 4.3% decrease quarter over quarter. How- ever, the fourth quarter’s activity pushed year-to- date total sales volume to $1.7 Please see Fundamentals, Page 19 Brad Lyons Executive vice president, CBRE National Retail Partners – Mountain Matthew Henrichs Senior vice president, CBRE National Retail Partners – Mountain Parker Brown First vice president, CBRE National Retail Partners – Mountain Source: CBRE Research, Q4 2022