Pittsburgh Retail Investment Forecast
Retail Sector Reaches Recovery Inflection Point;
Out-Of-State Buyers Supporting Subdued Trading
First signs of positive absorption emerge. The second half of 2021 provided the first significant glimpse of recovery for the Steel City's retail sector, as businesses began filling vacant stock. This leasing activity pushed quarterly net absorption above 100,000 square feet for the first time since 2018. While large retailers like JCPenney have reduced their footprints in the metro, others like Dick's Sporting Goods and Dollar Tree have steadily increased their presence. At the same time, local health retailer GNC was able to avoid significant closures, even after filing for bankruptcy last year. Developers sharply cut down on projects in 2021, as a result of these headwinds. Even with an acceleration in 2022, less space will be delivered than the trailing five-year average of 400,000 square feet. Even though the market will remain well below pre-pandemic performance at the end of this year, the growing presence of STEM, especially robotics, employers is an additional positive trend, as they provide a path toward future high-paying job creation for a metro traditionally known for its lower-wage employment sectors.