Orange County Retail Market Report
2023 Investment Forecast
Lack of Construction Steers Retailers to Existing Stock;
Metro’s Consistency Warrants Investor Attention
Tourists and higher-earning residents support retailer growth. Orange County entered this year with the nation’s smallest retail pipeline and California’s lowest vacancy rate. These conditions and a recent improvement in leasing velocity suggest tenant competition for available square footage will be palpable during 2023, as several factors motivate vendors to grow their local footprints or renew existing leases. Supported by a sizable cohort of higher-earning professionals, the metro’s median household income is among the nation’s highest, indicating Orange County residents may have larger discretionary budgets than individuals in nearby markets during a period of potential economic volatility. Additionally, visitor volumes have rebounded, bolstering prospects for retailers near amusement parks and beaches. While inflation and a possible recession could temper the tourism industry’s recovery this year, a full slate of major conventions could prevent a notable drop in outside patronage from occurring. The Anaheim Convention Center is scheduled to host at least 44 large events this year that will each support more than 1,000 room nights at area hotels.