The Columbia, SC retail market continued to perform very well in 2001 despite a weakening economy. The Colliers Keenan Retail Market Review encompasses 8,880,075 square feet of anchored neighborhood shopping centers in the Columbia MSA. As of year-end 2001 the overall occupancy rate of the market was 87.6% which is down slightly from 89.1% one year earlier.
The inventory of anchored neighborhood shopping centers increased 10% to 8,880,075 square feet largely due to two projects in Northeast Columbia being completed in 2001.
The average rental rate for “in-line” shop space was $10.65 per square foot, up slightly from year-end 2000 which was $10.63 per square foot. The average cost for pro-rated real estate taxes, insurance and common area maintenance pass through expenses increased by $0.10 per square foot to $1.76 per square foot largely due to increases in real estate taxes.
Regional malls performed well in 2001 with occupancy slipping slightly to 92.3% down from the previous year’s occupancy rate of 95.0%. Average rental rates fell slightly to $24.75 per square foot, down from $27.38 per square foot at year-end 2000. The cost for pass through expenses rose significantly from $9.02 per square foot the previous year to $ 11.34 at year-end 2001. The average sales per square foot for non-anchor tenants in the regional malls was $281.75 per square foot at year-end 2001.
2002 will be somewhat soft for the absorption of existing and new retail space in the Columbia market. The reduction in absorption is due to the general softness in retail sales and the contraction by many retailers in light of the recent economic recession. Northeast Columbia continues to experience a great deal of activity, as does the Harbison / St. Andrews market. Both of these sub-markets should perform much better than the rest of the retail market in Columbia during 2002.
Rental rates for anchored neighborhood shopping centers will likely remain flat in 2002 with more space becoming available as retailers take a “wait and see” position. Occupancy rates will likely remain the same or decline as some retail tenants postpone the opening of new stores until 2003.
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