Research & Forecast Report

SALT LAKE COUNTY | RETAIL

Mid-Year 2019

Retail Snapshot Market Indicators

Relative to prior period Current Year Over Year
After a strong start to the year, the Salt Lake County retail
market is changing. Mid-box and big-box retail spaces are VACANCY 4.44%
being absorbed for entertainment, multifamily and other new,
creative uses. In the meantime, retail tenants are struggling to YTD ABSORPTION 348,003 SF
find smaller blocks of space because very few new retail
centers are being built, limiting overall availability. CONSTRUCTION* 129,559 SF

While vacancy rates increased from 3.29 percent last year to RENTAL RATE** $21.78 NNN
4.44 percent currently — the first increase in over five years
— vacancy rates are expected to stay relatively the same over *Change in under construction
**For existing product — does not include asking rents currently under construction
the next 12 months as newly constructed buildings are filling
up as fast as they’re being built. Some older mid-box spaces
have sat vacant for quite some time as landlords search for a
tenant that can utilize this unique space. Due to four new
buildings starting construction this quarter, the under- Under Construction
construction figures increased from 65,000 square feet in the By Quadrant
first quarter of the year to 129,559 square feet currently. Over
16% 18%
half of current construction is taking place in the South East
quadrant. CW

Absorption increased quite a bit, from 45,879 square feet in 13%

NE
the first quarter of 2019 to 348,003 square feet mid-year. The
majority of positive absorption came from several different
SE
tenants averaging 2,000 square feet each. Almost 60 percent
of absorption year-to-date has occurred in the South West
quadrant, while the Central East, North East and North West SW
quadrants experienced negative absorption.
53%
Historical Vacancy Rates
By Product Type

14.00%
12.00%
10.00%
8.00%
6.00%
4.00%
9.56%

8.41%

9.49%

6.01%

6.27%

4.23%

3.29%

4.44%

2.00%
0.00%
2012 2013 2014 2015 2016 2017 2018 2019

Overall Anchorless (0-50K SF) Community (50,001-100K SF)

Neighborhood (100,001-350K SF) Regional (350K SF or greater)

1 Salt Lake County Research & Forecast Report | Mid-Year 2019 | Utah | Colliers International
Research & Forecast Report

SALT LAKE COUNTY | RETAIL

Mid-Year 2019

Market View Market View Map

By Product Type By Submarket

ABSORPTION AVERAGE ASKING

NORTH EAST INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE
NORTH NORTH
Anchorless 1,967,328 113,885 5.28% (30,496) $22.56
WEST EAST
Community 2,361,029 107,887 4.57% (1,198) $23.60
Neighborhood 540,078 24,694 4.25% 0 $22.48
Regional 502,227 33,600 6.69% 985 $30.00
TOTAL 5,370,662 280,066 5.00% (30,709) $24.35
ABSORPTION AVERAGE ASKING
NORTH WEST INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE
Anchorless 440,452 10,180 1.66% 1,680 $21.09
Community 734,674 37,930 5.16% (8,330) $23.69 CENTRAL CENTRAL
Neighborhood 535,513 105,814 19.76% (105,814) $11.95 WEST EAST
Regional 0 0 0.00% 0 -
TOTAL 1,710,639 153,924 8.83% (112,464) $16.02
ABSORPTION AVERAGE ASKING
CENTRAL EAST INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE
Anchorless 1,842,533 45,331 1.44% (7,505) $18.17
Community 2,129,386 171,897 6.04% (89,324) $13.66
Neighborhood 1,561,144 33,542 1.23% 11,019 $18.78 SOUTH SOUTH
Regional 2,159,205 141,882 6.29% 4,445 $26.25 WEST EAST
TOTAL 7,692,268 392,652 4.03% (81,365) $18.71
ABSORPTION AVERAGE ASKING
CENTRAL WEST INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE
Anchorless 1,296,459 38,133 1.17% 29,080 $20.64
Community 4,042,305 136,168 3.21% (13,243) $17.94
Neighborhood 1,306,043 123,246 8.46% 6,436 $17.53
Regional 1,583,503 132,040 8.34% 60,393 $30.00
TOTAL 8,228,310 429,587 4.71% 82,666 $22.21 Product Type
ABSORPTION AVERAGE ASKING
SOUTH EAST INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE Anchorless
Anchorless 1,345,739 71,656 2.69% 800 $17.30 (0 – 50K SF)
Community 4,185,384 150,702 3.51% (53,886) $14.74
Neighborhood 1,891,862 65,067 3.36% (34,110) $21.59 Neighborhood
Regional 804,319 9,741 1.21% 8,866 $25.00 (50,001 – 100K SF)
TOTAL 8,227,304 297,166 3.12% (78,330) $17.30

SOUTH WEST INVENTORY (SF) AVAILABLE (SF) VACANCY

ABSORPTION AVERAGE ASKING Community
YTD (SF) LEASE RATE
(100,001 – 350K SF)
Anchorless 1,241,137 43,110 1.64% 4,275 $25.66
Community 2,718,777 77,417 2.85% 150,987 $27.78
Regional
Neighborhood 1,635,189 105,213 3.60% 49,646 $23.59
(350,001 SF or greater)
Regional 3,919,032 324,828 7.16% 363,297 $24.11
TOTAL 9,514,135 550,568 4.60% 568,205 $26.90
ABSORPTION AVERAGE ASKING
OVERALL INVENTORY (SF) AVAILABLE (SF) VACANCY
YTD (SF) LEASE RATE
Anchorless 8,133,648 322,295 2.57% (2,166) $22.65
Community 16,171,555 682,001 3.89% (14,994) $17.39
Neighborhood 7,469,829 457,576 5.10% (72,823) $18.53
Regional 8,968,286 642,091 6.60% 437,986 $28.01
TOTAL 40,743,318 2,103,963 4.44% 348,003 $21.78

2 Salt Lake County Research & Forecast Report | Mid-Year 2019 | Utah | Colliers International
Research & Forecast Report

SALT LAKE COUNTY | RETAIL

Mid-Year 2019

Average Asking Lease Rate (NNN)

By Property Type

$35.00

$30.00

$30.00

$30.00
$25.00

$27.78

$26.90
$26.25

$25.66
$25.00
$24.35

$24.11
$23.69
$23.60

$23.59
$20.00

$22.56

$22.48
$22.21

$21.59
$21.09
$20.64
$18.78

$18.71

$15.00
$18.17

$17.94
$17.53

$17.30

$17.30
$16.02

$14.74
$13.66

$10.00

$11.95
$0.00
$5.00

$0.00
CE CW NE NW SE SW

Anchorless (0-50K SF) Community (50,001-100K SF) Neighborhood (100,001-350K SF)

Regional (350K SF or greater) Overall

Significant Transactions
YTD 2019

SIZE (SF) QUADRANT TENANT LEASED/SOLD

155,474 Central West Robert Bernheim Sold

Liberty Santa Monica

90,498 South East Sold
Properties

60,393 Central West Regal Cinemas Leased

52,250 Central West Alturas Sold

44,065 South West Dick’s Sporting Goods Leased

Under Construction Year-To-Date Absorption

By Quadrant By Quadrant

-10%
PROPERTY NAME QUADRANT SIZE (SF) CE
9%
The School Yard SE 50,000 CW
-3%
NE
110 Retail SE 18,350
NW 60% -12%
Sugar Alley NE 16,303
SE
Ace Hardware SW 15,000 -8%
SW

3 Salt Lake County Research & Forecast Report | Mid-Year 2019 | Utah | Colliers International
 Employment Growth Lease Rate Activity
Salt Lake County’s job growth rate is consistently among the Lease rates have increased from $20.42 in the first quarter of
best in the nation, up 2.4 percent year-over-year compared to the year to $21.78 currently. With increases in land and
3.1 percent statewide and 1.8 percent nationally. That’s an construction costs as well as a lack of available land, lease rates
increase in 17,124 jobs, mostly in the will continue to increase for the foreseeable future. Lease
trade/transportation/utilities sector. Salt Lake County has the rates are the highest in large, regional spaces.
highest wages in the state, and unemployment has essentially
plateaued at a low of 2.8 percent in Salt Lake County and 2.9
percent in Utah, compared to a national average of 3.6 percent.

Source: Utah Department of Workforce Services

FOR MORE INFORMATION CONTRIBUTORS

Megan Grangroth Kathy Sturzenegger Cameron Simonsen Lori Coburn

Office Research | Utah Communications Coordinator Executive Vice President Associate
+1 801 453 6822 +1 801 947 8300 +1 801 453 6824 +1 801 947 8352
megan.grangroth@colliers.com kathy.sturzenegger@colliers.com cameron.simonsen@colliers.com lori.coburn@colliers.com

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