Most surprisingly given the steady influx of investment into the DC area by institutional investors not to mention its high level of household income, retail is underserved here, Delta Associates says in its new report TrendLines, authored by CEO Greg Leisch. This situation is unlikely to change in the near future as there is only a modest pipeline of development.

Right now the metro area's retail space per capita is 21.3 sf per capita; some submarkets, such as the District itself at 7.8 sf per capita, are even tighter. This compares to the national average of 20 sf per capita. Although more than 12.3 million sf of retail inventory has been added to the DC area since 2000, the area remains underserved thanks to a growing population.

These fundamentals point to a number of opportunities for investors in retail. Value add plays could be particularly profitable: Delta Associates notes that the Washington shopping center landscape is aging, with just over half of the shopping centers over 25 years old, while only 16% are aged 10 years or less. Prince George's County, in particular, takes the lead, as 64% of its total retail inventory is aged 26 years or older.