ABG Commercial Realty | (617) 492 9900

ABG Commercial Realty

Local Boston & Cambridge Commercial Real Estate News from Industry Experts.

View Commercial PropertiesList Your Property with Us

Retail rents in markets across the Americas now stand a whopping 15% above pre-pandemic levels, according to a new report from Cushman & Wakefield.

The firm’s Main Streets Around the World report — Cushman’s first in three years — notes that rents across global prime retail destinations slumped 13% from before the pandemic to hit their lowest point on average, but have subsequently rebounded to sit 6% below pre-pandemic levels. Rent growth has been more wobbly in regions like Asia-Pacific, where rents fell on average by 17% during the pandemic (and in cities like the Luohu district  of Shenzhen in China, rents declined by 30% over the past year).

But in the US, which drove much of the Americas’ retail rent growth, rents are now well above pre-pandemic levels. In Houston’s River Oaks district, for example, rents are up an eye-popping 90% over the last year.

Overall, global retail markets have recouped nearly half their losses since the apex of the pandemic, with the global average rent sitting 6% below pre-COVID levels.  But “the pace of recovery has varied,” the report notes. “Arguably it has been strongest in the U.S., in part the result of supportive fiscal policies but also the result of domestic migration patterns that have driven strong population growth in markets such as Houston and Austin—and as a result, an influx of buying power into those markets.”

Cushman analysts further note that while a doubling of rents in those Texas cities “is both impressive and somewhat surprising, there are clear drivers; that these markets are at the less expensive end of the U.S. cost spectrum also had influence on the percentage growth figure, coming off a lower base.”

Rents in luxury retail corridors in the US are now boasting a 25% premium to pre-COVID levels, according to the report.  And while New York City’s Upper Fifth Avenue remains on top of the firm’s list of most expensive retail markets, Rodeo Drive in Los Angeles follows behind in the #2 spot, followed by San Francisco’s Union Square, Las Vegas Boulevard in Sin City, Chicago’s North Michigan Avenue, and Boston’s Newbury Street.

Going forward, Cushman says consumer confidence will remain key.  Total retails sales are up 33% in the US over pre-pandemic levels as of midyear 2022, “the uncertainty of inflation and the pressure on household spending—higher mortgage and rent, energy and food costs—have left consumers anxious about the next 12 months,” the report notes. “The expectation and hope is that once there is some indication that inflation is stable and abating, we will see consumer confidence bounce back. To an extent, there is early—if somewhat fragile—evidence of this sentiment, as we see confidence in many markets bottoming, and in some cases, even beginning to improve.”

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close