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Market Report

Washington, D.C. Retail Market Report

2023 Investment Forecast

High-Wage Job Growth and Strong Pre-Leasing Provide
Stability in Washington, D.C.’s Retail Sector

Tenants target growing suburban areas. Washington, D.C. recorded over 1.7 million square feet of positive net absorption last year, marking the highest annual total since 2016. Subsiding health concerns led to increased foot traffic at brick and mortar shops and restaurants, which has spearheaded a resurgence in leasing activity. Retailers are primarily targeting fast-growing regions within the metro like Loudoun County, where the local population increased by more than 30 percent between 2010 and 2020. With the recent completion of the metro Silver Line Extension late last year, this area will likely continue to garner strong interest from both developers and retail tenants moving forward. Although macroeconomic headwinds, such as rising inflation and a slowing economy, loom over the nation as a whole, there is still room for optimism in the D.C. metro. The market boasts a median household income exceeding $120,000 per year, and local expansions from notable firms like Amazon will continue to drive growth in high-paying jobs, further bolstering consumer spending power. Supply pressure will be minimal as well, with roughly 75 percent of the retail pipeline already pre-leased entering this year.
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