The Southern California retail sector reached mid-year on a positive note, experiencing little change despite the Toys R Us store closures that began rolling through the region. Vacancy improved slightly in the Inland Empire decreasing from 7.6% to 7.3% with an absorption of 725,290 square feet. Leasing activity from prominent grocers, discounters and across the food industry offset much of the new space entering the market in Orange and Los Angeles counties.
Q2 Retail Report – Los Angeles County
| LOS ANGELES | Q2 2018 | Q1 2018 | Q2 2017 | % Change v. Q2 2017 |
|---|---|---|---|---|
| Vacancy Rate | 3.8% | 3.7% | 4.3% | -12% |
| Net Absorption | -295,878 sf | 58,072 sf | 7,353 sf | 3924% |
| Vacant Space | 1,094,622 sf | 848,419 sf | 1,285,101 sf | -15% |
| New Construction Delivered | 141,008 sf | 356,689 sf | 419,485 sf | -66% |
| Unemployment (LA) | 4.1% | 4.5% | 4.1% | 0.0% |
Largest LA lease signings in Q2 included:
- 85,653 sf Vallarta Supermarkets at 8201 Topanga Canyon Blvd., Canoga Park – Former Vons
- 52,991 sf Burlington Stores at Southbay Pavilion, 20700 Avalon Blvd., Carson – Former subdivided Sears
- 43,703 sf Hannam Market World at Village del Amo, 21305 Hawthorne Boulevard, Torrance – Former Sports Chalet
- 42,460 sf Hobby Lobby at 14555 Ocean Gate Avenue, Hawthorne – Former Sports Authority
- 23,039 sf Ross Dress for Less at Southbay Pavilion, 20700 Avalon Blvd., Carson – Former subdivided Sears
Q2 Retail Report – Orange County
| ORANGE COUNTY | Q2 2018 | Q1 2018 | Q2 2017 | % Change v. Q2 2017 |
|---|---|---|---|---|
| Vacancy Rate | 3.8% | 3.8% | 4.2% | -10% |
| Net Absorption | 47,742 sf | 215,457 sf | -107,821 sf | -144% |
| Vacant Space | 210,794 sf | 230,492 sf | 362,870 sf | -42% |
| New Construction Delivered | 21,882 sf | 98,986 sf | 52,098 sf | -58% |
| Unemployment (LA) | 2.6% | 3.1% | 3.2% | -19% |
Largest OC lease signings of Q2 include:
- 72,196 sf Floor & Décor at 25872 Muirlands Blvd., Mission Viejo – Former stand-alone Haagen grocer
- 42,564 sf “Mini” Target at Anaheim Town Center, 2180 E. Lincoln Avenue, Anaheim – Former Kmart
- 40,041 sf Marshall’s at Marketplace at Laguna Niguel, 27080 Alicia Parkway, Laguna Niguel – Former Sports Chalet
- 21,648 sf AMC Cinemas at Anaheim Gardenwalk, 321 W. Katella Avenue, Anaheim – Subdivided former theater, other half occupied by House of Blues
- 18,684 sf Vibe Gymnastics at 1411 N. Tustin Street, Orange – Former Office Depot
Q2 Retail Report – Inland Empire
| INLAND EMPIRE | Q2 2018 | Q1 2018 | Q2 2017 | % Change v. Q2 2017 |
|---|---|---|---|---|
| Vacancy Rate | 7.3% | 7.6% | 7.5% | -3% |
| Net Absorption | 725,290 sf | 235,661 sf | 359,404 sf | 102% |
| Vacant Space | 496,152 sf | 426,759 sf | 600,677 sf | -17% |
| New Construction Delivered | 144,705 sf | 313,698 sf | 277,839 sf | -48% |
| Unemployment (Riv Cty) | 3.8% | 4.5% | 4.6% | -17% |
Largest IE lease signings of Q2 include:
- 188,590 sf College of the Desert at Palm Springs Mall, Baristo & Farrell, Palm Springs – Portion of long-time vacant mall, parcel of parking lot also sold to College
- 39,287 sf Bob’s Discount Furniture at Desert Crossing, 72333 Highway 111, Palm Desert – Former Sports Authority
- 30,080 sf Stater Bros. at at Day Creek Marketplace, 7200 Day Creek Boulevard, Rancho Cucamonga – Ground-up development
- 19,961 sf local church at Murrieta Crossings, 39681 Avenida Acacias, Murrieta – Former Youfit Health Club
- 19,104 sf 99-Cent Only at 12618 Schleisman Road, Eastvale – New construction
Sources: California Employment Development Department; Co-Star; Coreland Companies