Louisville Retail Investment Forecast
Resilient Economy To Benefit From Broader Recovery;
CBD-Adjacent Assets Draw Interest
Pent-up consumer demand driving fundamentals to historic levels. While the national retail sector has experienced widespread hurdles since the onset of the pandemic, Louisville has been largely unaffected, partially due to less stringent capacity restrictions and minimal construction activity. Entering this year, the metro boasted a vacancy rate 80 basis points below the 2019 figure, with the average asking rent up 14 percent over the past two-year stretch. Just five of the metro's 24 submarkets entered 2022 with a vacancy rate that exceeded their year-end 2019 recording, with three of those areas still reporting sub-4 percent availability. Hiring in the metro is increasing at a speed exceeding the 2019 rate, producing a metrowide headcount within 0.5 percent of the pre-pandemic peak by the end of this year. Recovering hiring trends will lead to more foot traffic in office hubs like South Central, aiding recovery in the metro's few lagging locales. These positive trends should continue, as the projects scheduled to open this year are not sizable enough to affect existing properties, leading to the lowest retail vacancy rate of all major metros here.