Northeast Ohio Retail Vacancy Rate Falls
Auto parts and dollar stores stayed alive through much of the recession. Now they're being joined by new restaurants, fitness centers and, of all things, mattress stores. And clothing retailer Gordman's announced it's opening stores in Mentor and Bainbridge.
Crain's Cleveland Business reports the retail vacancy rate held steady around 12 percent for several years, before falling last year to 9 percent -- its lowest level since before the recession.
Stan Bullard covers real estate for Crain's. He says the drop in vacancy surprised him.
"Retail has been the most decimated segment during the downturn, because back in the 2008, 2009 period, so many different retailers nationally went out of business, so it's really been quite a change," he said.
The figures come from real estate firm CBRE, and cover the Cleveland, Akron and Canton areas.
David Browning, a managing director with CBRE, said those retailers who have moved into the region are leasing spaces that have already been built.
"Really, there's a good story here in terms of active retailers making commitments for space," Browning said. "And given that we haven't had a lot of new construction in strip shopping centers, it means that, overall, the market is much healthier now than it was several years ago
Cleveland State University professor Roby Simons said the large drop in the vacancy rate left him with more questions than answers.
“It’s too big, too fast. The economy’s not that great. It’s better than it was, there’s still competition from the internet,” he said. “I can only think that there’s a huge drop in supply someplace.”
The demolition of Randall Park Mall was factored into these numbers, Bullard said, wiping the vacant retail space off the region's ledgers.
Also key to the falling vacancy, analysts say, is that as older shopping spots see some new life, Northeast Ohio isn't building many new malls.
Scott Wiles is a vice president in the Cleveland office of Marcus & Millichap.
"That's why some of the retail corridors like Mayfield Road, and Lorain and Mentor Avenue, they got impacted pretty severely in 2009 and 10," Wiles said, "but because there was not much in the way of new construction in recent years, they were the fastest to rally back."
Northeast Ohio does have catching up to do. Wiles says Cleveland still has higher vacancy rates than many other metro areas across the country.