Central Ohio retail market ends year on a positive note
After a negative start to 2014, the Columbus commercial retail
market ended the year on a positive note posting its third consecutive quarter
of positive net absorption. The 122,237 square foot gain in occupancy over the
course of the year erased the early loss and the overall vacancy rate.
The Northwest and Southeast submarkets posted the largest
gains in the fourth quarter with 43,893 and 19,161 square feet of positive
absorption, respectively according to the Central Ohio Information Exchange
(COCIE). These gains can be attributed to three leases in the Northwest
including Planet Fitness, Hockey Stop and Player Bench Corp as well as
Save-a-Lot in the Southeast.
Retail activity was slightly down in the fourth quarter,
but this is nothing unexpected.
“This is nothing alarming. The fourth quarter is
traditionally slower because stores are busy with holiday sales,” said Brian
Irwin, director of client services and sales at Xceligent.
Although retail activity was slightly down, there were some
unique openings such as Tequila Cowboy in the Polaris area as well as parts of
the Easton Gateway opening.
“Fast casual restaurants such as Chiptole also continued to
be a heavy trend as well,” said John Royer, Columbus REALTORS® President Elect
and President of Kohr Royer Griffith.
Fifty-four leases totaling 224,780 SF of retail space were
leased in the tracked data set during fourth quarter. The Columbus tracked data
set consists of an inventory of buildings considered to be competitive within
the brokerage community.
The overall vacancy rate also returned to 9.4 percent,
which is where it started. Vacancy rates range across the region from a
high of 16.9 percent in the Southeast submarket to the Northwest’s low of 4.9
percent, a decrease over the previous year of 70 basis points. The biggest
winners, however, were in the surrounding counties, including Madison County’s
vacancy rate decreasing 3.1 percentage points to 11.7 percent.
“Columbus is on a very positive trend,” Irwin said of the
vacancy trend. “More small space is being leased. This may be a factor
from the improvement in the economy.”
Vacancy will remain steady for the next two quarters and
then have a slight increase, Irwin further said. New construction being
delivered will affect the rates, but in a positive way.
Demand for inventory is also continuing to improve in
“When vacancy rates drop, developers start to build to meet
demand,” said Irwin. “The Polaris area is about to boom again with the new IKEA
in 2017 and the outlet malls on exits 36 and 37 off of I-71.”
2015 looks to be a promising year for commercial real
estate in central Ohio.
“I’m very optimistic for the Columbus Retail market.
It’s not a traditional market with mom-and-pop stores, but rather national
retailers. I’m excited to see the new developments being announced in
2015,” Irwin said.
Royer commented that he thinks commercial real estate in
2015 will be stable and there may even be a slight uptick in the market.
“I expect 2015 to be a solid year. The exciting
announcement of IKEA is a big deal in the Polaris area and may also boast well
for Columbus as a whole,” Royer said.
4th Quarter 2014 Retail Overview
4th Quarter 2013 Retail Overview
3rd Quarter 2014 Retail Overview
For vacancy and absorption purposes, COCIE
tracks 377 existing community, convenience, neighborhood, grocery anchored
strip and power centers with a minimum of 20,000 SF in the Franklin, Delaware,
Union, Licking, Fairfield, Pickaway and Madison counties with a total inventory
of almost 39 million square feet.
The entire database includes 4,518 retail records totaling over 108 million
square feet and also includes big box retail, regional centers, smaller
convenience centers, restaurants, free standing single tenant buildings, fast
food properties, etc.
To view commercial properties for sale or lease in central Ohio, visit www.COCIE.org.
To view residential properties for sale, visit www.Realtor.com.
To view residential housing reports, visit www.ColumbusRealtors.com/stats.