Washington, D.C. Retail Market Report

Vacancy in NoVa hits three-year low. Northern Virginia’s retail sector continues to note tighter conditions than the rest of the Washington, D.C. metro, despite hosting over two-thirds of its total deliveries in the last three and a half years. Vacancy in the region fell 30 basis points in the first six months of 2023 to a three-year low of 4.2 percent, as local net absorption tripled deliveries during the span. Northern Virginia’s high-income suburbs are growing more appealing for retailers, with consumer spending here being viewed as comparatively inflation-resistant. Space demand in the frame was robust in the Leesburg-Route 7 and Woodbridge-I-95 corridors, as well as Manassas-Route 29-I-66, with each ranking at the top of the metro for net absorption during the first half. Affluent local populations in these submarkets have anchored interest from specialty retail tenants, including Amazon Fresh, Tesla and Onelife Fitness.