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Market Report

Seattle-Tacoma Retail Market Report

4Q 2023

Persistent Lack of Construction Supports Retail
Property Performance Through Transitionary Period

Submarket trio stands out regionally. In June 2023, the Eastside, Southend and Tacoma had the three lowest vacancy rates among major Pacific Coast submarkets with at least 5 million square feet of stock. Local metrics have minimally adjusted over the last three years, supported by their inventories growing by no more than 1.4 percent in the span. Zoning legislation in Seattle-Tacoma has continued to be highly geared toward the production of housing, limiting supply-side pressures in the retail sector, while expanding the consumer base in most areas. These submarkets collectively hosted the addition of roughly 2,200 rentals in the first half, compared to a negligible amount of new retail supply during the frame. Retailers seeking newer, higher-quality spaces across these locations will likely have to contend for them near-term, with overall completions expected to be at the lowest volume since 2007 this year.
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