Stronger leasing and a decline in construction have pushed the vacancy rate at Dallas-Fort Worth shopping centers to its lowest level in a decade.
“Today, for the first time in a decade, our occupancy rate is at 90 percent,” said Bob Young, managing director at The Weitzman Group real estate firm in Dallas, which presented its annual market report Tuesday. “This has been our goal for the market.”
The Fort Worth market is slightly stronger than the Dallas one, with 90.5 percent occupancy, compared with 89.8 percent, the report said.
The Shoppes at Renaissance Square, at U.S. 287 near East Berry Street, between Vaughn and Mitchell boulevards, was the largest new project in Dallas-Fort Worth in 2013, with more than 300,000 square feet, the report said. It’s anchored by a 187,000-square-foot Wal-Mart Supercenter.
Because of limited new construction, retailers are filling space left vacant by others that didn’t survive the recession, Young said. Total vacant space dropped to 18.8 million square feet in 2013, down from 23 million just two years ago, the report said.
“We’ve cut our supply of vacant boxes in half during the past two years,” Young said. “We’ve gone from 140 box vacancies to less than 70 today.”
Herb Weitzman, The Weitzman Group’s chief executive, said retail construction is down about 75 percent from a decade ago. From 2000 to 2003, about 5.5 million square feet of retail space was added every year. In the past four years, the annual average has been under 2 million square feet.
Grocery stores still lead the market, both in grabbing vacant space and in new construction, and they are taking over the larger portion of newly built shopping centers, Weitzman said.
Construction totaled about 1.9 million square feet in 2013, most of that for grocery stores, the report said.
“The shops that used to be outside the grocery are now inside,” Weitzman said.
The report surveys 190 million square feet at 1,372 shopping centers in North Texas.