Orange County Retail Market Report
Orange County’s Retail and Economic Performance Fuels Optimism, Yet Near-Term Hurdles Loom
Positive leasing emerges. After a 15-month span of negative absorption, Orange County’s retail sector registered a decline in vacant stock during the second quarter of 2021. This step toward a broader recovery coincided with the reopening of California’s economy and area amusement parks welcoming back guests, which boosted tourism and patronage at local restaurants, bars and shopping centers. Retail improvement has also corresponded with a strong rate of household formation and a regionally low unemployment rate that is lifting spending at necessity and home goods stores. In response, some retailers are expanding, highlighted by At Home’s commitment to 105,000 square feet in Tustin and a recently shuttered Fry’s Electronics being backfilled. Positive leasing and renewal activity is expected to continue in the second half, allowing vacancy to hold more than 100 basis points below that of other Southern California metros.