Philadelphia Retail Market Report

City vacancy low despite headwinds in other sectors. While Kastle Systems' local office use metric hovered around 50 percent in late May, the foot traffic impact to retailers is not apparent in overall property fundamentals. Across the city of Philadelphia, retail vacancy was 3.2 percent in March, 140 basis points below the marketwide rate. Vacancy was especially tight in University City at 0.4 percent, as multiple educational institutions sustain an active neighborhood for retailers. Rates under 3 percent were also noted in Northwest, West and South Philadelphia as well as in Market Street East. Modest development across most of the city will help sustain this dynamic. Outside of the retail component of Broad & Washington and Penn Foods Market, no project over 50,000 square feet is underway.