High Occupancy Rates Spur New Construction
- King Street continued to excel with new retail tenants including C Wonder, H&M and Madewell opening stores in downtown Charleston.
- Increased demand for retail space spurred new construction and redevelopments throughout the Charleston region.
- Average asking rental rates continued to rise for shop space on King Street and in high growth suburban areas.
- Suburban submarkets encountered the “Grocery Wars” as Piggly Wiggly stores sold and reopened as Bi-Lo or Harris Teeter.
Fourth Quarter 2013 Recap
The Charleston retail market continued to improve since mid-year 2013 with increased occupancy rates and new construction. National tenants are showing a greater interest in Charleston. Bass Pro Shops, Southern Season, H&M, Chipotle and Madewell all opened stores or announced plans to locate to the market. Mixed-use developments in Charleston’s urban cores continued to bring new street level retail to apartments, hotels and office buildings. Much of this is complimentary shop space, but in some proposed developments, there are more significant junior anchor components.
Occupancy rates increased to 93.9% at year-end 2013 from 93.3% at mid-year and 92.7% a year ago. Charleston’s employment growth, recovered housing market and booming tourism industry contributed to the rise in occupancy rates. The rising demand for retail space resulted in higher asking rental rates for shop space; which ended 2013 at $19.00/SF up from $18.89/SF at mid-year and $18.25/SF a year ago. King Street in downtown Charleston reported the highest asking rental rates at $40.00/SF while rents in suburban grocery-anchored centers averaged $15.50/SF.
Construction commenced in Summerville, East Cooper and Downtown submarkets, which hold the highest occupancy rates in the market.
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