Retail recorded a solid third quarter, dropping to the lowest market vacancy rate since the start of 2008. An expanding population of Bay Area
households and relocating Millennials has helped Sacramento’s retail market in recent years. Three growing sectors are driving retail demand
in Sacramento in 2018: bargain grocery, fitness centers and health clubs, and bars and restaurants. Grocery Outlet opened two new locations
this quarter, one in North Sacramento and another in Orangevale, with two more stores scheduled to open by the end of the year. Planet Fitness
leased 18,400 square feet in Fair Oaks in August, and Orangetheory Fitness, named the fastest-growing franchise in the U.S. by Franchise Times,
is opening a new location in Campus Commons in the fourth quarter. More than 108,000 square feet of new fitness center and health club leases
have been signed or locations opened in 2018. In addition, VillaSport Athletic Club & Spa is building a 130,000 square foot location in Roseville,
LA Fitness is planning a new 37,000 square foot gym in Elk Grove, and 24 Hour Fitness is reportedly opening two new Sacramento area
locations in the next two years. There are now 68 bars and 139 restaurants in Downtown Sacramento and 49 new retail businesses have opened
or are planning to open since the Golden 1 Center completed in 2016. In the city of Sacramento alone, an estimated 57 new locations totaling
more than 207,000 square feet of new restaurant space have opened or are scheduled to open this year in America’s Farm-to-Fork Capital