CoStar: Retail rents will fall as much as 15% in 2020

Some retail shops, restaurants, fitness centers, and movie theaters that survive the pandemic panic may be paying much lower rents in the coming years.

CoStar, the commercial real estate research group, predicts that conditions put into play by COVID-19 will cause retail rents to plummet 13% to 15% year-over-year in 2020. The company’s April forecast had also predicted a steep drop, but a much lower one at 8% to 13%.

“The big thing that influenced our call this month is all the vacant space. At the beginning, when all the temporary closures started, retailers weren’t announcing permanent closures the way they did before,” said CoStar consultant Robin Trantham. “Now, in the last couple of weeks, we have a number of permanent closures by J.C. Penney and we have Pier 1 liquidating.”..
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RSK: If you are talking mall retail definitely but some of the small strip malls and stand alone locations will only fall slightly from what I see.