During the second quarter of 2010, vacancies remained relatively flat as average asking rents among anchored-retail centers continued their move downward. Reporting a vacancy rate of 10.4 percent at the close of the second quarter of 2010, vacancies were relatively stable compared to the previous quarter, but linger 0.2 points above the 10.2 percent witnessed during the same period of the prior year (Q2 2009). As the vacancy rate remains elevated with little demand for the nearly 5.4 million square feet of vacant space, downward pressure continues to be exerted on average asking rents. On a per-square-foot basis, average monthly rents fell to $1.68, a 16.8- percent decrease from $2.02 witnessed just one year ago.

By quarter-end, the market witnessed positive absorption as more retail tenants moved into space than moved out, for a total of 165,600 square feet of positive absorption. However, excluding pre-leased new construction, the positive absorption figure still suggests limited positive activity as only 26,200 square feet of second-generation positive net absorption occurred during the quarter.

At the end of the second quarter, the retail market reported 51.9 million square feet of inventory, as 139,400 square feet of new space was added to the market with a Lowe’s being completed in the northwest submarket. Projects that remain actively under construction total approximately 568,800 square feet while plans for 5.1 million square feet remain on the drawing board. Inventory figures exclude nearly 1.3 million square feet of space that has stopped development due to current economic conditions.