Las Vegas Sun

February 12, 2012

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Retail vacancy rate dips for first time in 3 years

Vacancy rate for office and industrial buildings rises in fourth quarter

By Buck Wargo

Thursday, Dec. 31, 2009 | 2:05 a.m.

The vacancy rate for office and industrial buildings rose in the fourth quarter, but the retail market halted its slide for the first time in three years, according to a report released this week by CB Richard Ellis.

The Las Vegas brokerage reported the retail vacancy rate decreased for the first time in 12 quarters — it fell from 13.1 percent in the third quarter to 12.3 percent at the end of the year.

The firm attributes the decline in the vacancy rate to a large number of big-box retailers taking up space. In the fourth quarter, Target opened a store in Henderson, Home Depot and Staples opened in North Las Vegas and Ashley Furniture opened at the former Levitz Plaza. Planet Fitness opened its first center in the valley at the Shanalee Shopping Center in Henderson and several Hispanic groceries have leased space in the northeast in recent months.

The average lease rate for retail space fell 3 cents in the fourth quarter to $1.82 per square foot, which is 32 cents below a year ago, the brokerage reported.

In the office market, the vacancy rate rose to 23 percent, up 1 percentage point from the third quarter and well above the 17 percent vacancy rate a year ago, the firm reported.

The northwest and southwest valley had the highest vacancy rates at 39.5 percent and 34.1 percent, respectively, the brokerage reported. Both the southeast and southwest valley have more than 1.3 million square feet of vacant space each.

The lack of demand for office space depressed rents. The average monthly lease rate requested by landlords fell 6 cents per square foot in the fourth quarter to $1.96. It is down 44 cents since the end of 2008, the firm reported.

In the industrial market, the vacancy rate rose to 10.15 percent, up from 9.1 percent in the third quarter. The vacancy rate was 7.6 percent at the end of 2008.

The asking lease rates fell 3 cents to 62 cents since the third quarter and are down 13 cents since the end of 2008, the brokerage reported.

The vacancy rate for office and industrial space continues to rise as more space comes online and businesses close their doors.

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