The Chicago-area retail vacancy rate got up to 11% in 2009 as more retailers closed stores amid rising joblessness and grim consumer sentiment according to Chicago Real Estate Daily in their article, “Empty Big-Box Stores Drive up Retail Vacancy”.
Much of the rise in empty Chicago storefronts comes from 227 big-box anchor stores that are 20,000 square feet or bigger with the total amounting to 10 million square feet. The last time the market was even half this deluged with big-box stores was in 2004 when there was 102 available stores totaling 5.9 million square feet. Many landlords are forced to choose between waiting or taking low-paying rent as every potential tenant will end up being a low-paying tenant.
The crisis is not over, but the worst of it is most likely behind us. Sales at U.S. retail stores are climbing from quarter to quarter but it’s nothing to get too excited over as the move is simply from extreme weakness to moderate weakness. With such a dried up market for tenants, landlords need to really consider their property value in a time like this.
Read the full article from Chicago Real Estate Daily here.