July 31, 2017
Weitzman recently released its San Antonio 2017 mid-year retail report. Much of the news is good, with an occupancy rate of 94%, continued demand, and limited construction of spec space. Connect Media caught up with Weitzman’s senior vice president Marcus Shaffer, for some in-depth commentary on the San Antonio market.
A. We’re fortunate to work in a market with a strong economy, which is the biggest reason for our strong balance of supply and demand. We’re at near-full employment with an unemployment rate of only 3.6 percent, and that’s keeping our single- and multi-family markets healthy. All of that attracts retailers’ interest and attracts major concepts like IKEA to our market.
Q. The recent Weitzman mid-year report mentions that limited construction is an issue. Why isn’t more retail space being built in and around San Antonio?
A. We reflect the statewide, even nationwide, trend of new construction being dominated by anchors with very limited “spec” small-shop space. That keeps overall construction in check. We do expect to see new space additions pick up in 2018 and 2019, as large projects in the pipeline – like the IKEA-anchored Live Oak Town Center – and the expansion of existing projects come online.
Q. The report also mentions that retail construction seems to be dominated by H-E-B grocery-anchored projects. What other retail types seem popular in the Alamo City?
A. San Antonio is experiencing strong mixed-use activity, most notably in the continued expansion of The Pearl, with office, retail and residential space. Urban mixed-use in the works include projects downtown, along the River Walk and along the Broadway corridor.
We’re in an extremely strong market for new multi-family and single-family construction, which is a result of healthy job and population growth. That’s why grocers like H-E-B and Walmart have dominated construction over the past several years.
Restaurants remain one of the stronger categories as well, and we’re getting new entrants. New York-based Shake Shack and Dallas-based The Rustic and Gloria’s and seeing expansions from concepts like Stonewerks Big Rock Grille, Taco Palenque and others. Demand for space is also generated by beauty, health and wellness, fitness, medical and dental services.
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