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Market Report

New Haven-Fairfield County Retail Market Report

2023 Investment Forecast

Affluent Consumer Base Supports Fundamentals and Encourages
Investment as Retail Sector Faces Hurdles

Regional consumer demand well-positioned to withstand headwinds. At the end of 2023, the region is anticipated to retain the highest median household income among major U.S. markets. This should support retail spending, even as high inflation continues to weigh on consumers. A measured pace of inventory additions provide another note of optimism, with developers expected to expand stock by just 0.4 percent marketwide this year. As of late 2022, more than 90 percent of the active construction pipeline had already been leased, foreshadowing minimal supply impact on vacancy during the near term. Macroeconomic factors will nevertheless create some hurdles for the local retail landscape this year as the region’s job market undergoes a minor contraction. Softening economic outlooks have convinced some tenants to pause or cancel planned expansions, translating into the lowest positive net absorption figure in more than 15 years. While certain locales like Bridgeport and New Haven could face stronger headwinds, a relatively affluent overall consumer base should meter regional upward movement in availability.
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