Tampa-St. Petersburg Retail Investment Forecast
Strong Levels of In-Migration and Tourism Underpin Retail Spending, Boosting Investment to Record Levels
Retail demand bolstered by employment and population gains. Robust job growth and elevated levels of tourism boosted consumer spending over the past year, encouraging retailers to enter the region or expand their market presence. As a result, leasing activity returned in force, slicing availability within 20 basis points of the metro's pre-pandemic rate. Moving forward, the outlook for Tampa's retail sector is bright as fundamentals are poised for further improvement this year. The metro remains a top migration destination for residents moving from other markets, supporting a healthy rise in Tampa's population. Additionally, employment growth continues to outpace the national average, contributing to a rise in the median household income and further bolstering consumers' ability to spend. A larger consumer base and increased spending power will encourage additional retailer expansions at a time when construction activity is on pace to slow to a 15-year low. Of the 700,000 square feet of space scheduled to deliver, most was pre-leased at the onset of 2022. This diminished pipeline and strengthening demand for available space will promote further vacancy compression and rent growth throughout the year.