Raleigh Retail Market Report

High-wage job creation maintains nationally-tight availability. Competition among expanding vendors for available retail space remains stark in Raleigh, with the metro tied for the lowest vacancy rate among major U.S. markets entering the year. Consumer spending is being stimulated by the recuperation and expansion of staff by local firms, which have added nearly 70,000 new jobs since the onset of the health crisis, compared to just 40,000 during the equivalent two-year span prior to February 2020. The typically high-wage tech, finance and medical sectors have accounted for most of this recent hiring, allowing Raleigh to lay claim to the Southeast’s largest median household income. A collection of well-earning professionals, paired with continued household formation and net in-migration, will enable the market to register the fastest retail sales growth in the nation this year. These factors should stoke retailer demand for space, with a lull in new supply steering expanding vendors to existing properties. This dynamic will maintain extremely tight conditions, despite near-term job market uncertainty that is expected to negatively impact some households’ discretionary spending power.