The Colliers report, done in conjunction with locally based Restrepo Consulting Group, says no new retail centers were delivered in the second quarter and that net absorption was negative at 235,000 sf. The CBRE report shows 880,000 sf of new retail space being delivered and net absorption being positive to the tune of 450,000 sf.
The result is a 180 basis point difference in the overall vacancy rate, with CBRE putting it at 5.82%, up from the mid 4% range 12 months ago, and Colliers placing it at 4%, up from 3.1% 12 months ago.
A third report, by Applied Analysis, a locally based business research and advisory firm that tracks 50 million sf of retail in the market, shows a more dramatic increase in vacancy than either of the first two reports. Applied Analysis puts the current vacancy rate at 6%, up from 3.3% 12 months ago, a 270-basis -point increase in the past year and the highest vacancy rate since the mid-1990s. CBRE is reporting a 180-basis-point increase over the past year. Colliers is reporting a 90 point jump.
Like the CBRE report, the Applied Analysis report says there were new deliveries in the quarter, but pegged the number at 325,000 sf, less than half that of CBRE. Like the Colliers report, Applied Analysis found net absorption to be negative for the quarter, but put the actual figure at 19,000 sf, much less than Colliers reported.
Part of the discrepancy results from the type of square footage the companies track. While none of the companies track regional and super-regional malls, CBRE and Applied Analysis track smaller and, therefore, more buildings than Colliers.
Colliers says it typically only tracks anchored retail centers in excess of 50,000 sf while CBRE says it tracks buildings as small as 20,000 sf. Applied Analysis says it tracks smaller buildings that are anchored, such as those anchored by the new small-format grocery chain Fresh & Easy. Whether that accounts for the entire difference in the amount of square footage each report covers -- CBRE tracks 60 million sf, Applied Analysis 50 million sf and Colliers 40 million sf.
John Stater, Colliers research manager for Las Vegas, said that in addition to the difference in the type of product being tracked, one additional explanation for the discrepancies may lie in how the different researchers are treating Arroyo Market Square, a new 1 million-sf retail center. "We showed it being completed last quarter, so that addition to the market was recorded in the first quarter by us," he says. "It could be [CBRE report] could be phasing it in and showing a large chunk of it in their numbers this quarter."
Stater adds that CBRE's inclusion of smaller retail centers than Colliers includes also could help explain the some of the discrepancy in vacancy. "While I don't track the smaller buildings I have heard that vacancy is higher in the smaller product."
While CBRE's research director could not immediately be reached Tuesday for comment, Brian Gordon, a principal with Applied Analysis, says he accounted for most of Arroyo Market Square in the fourth quarter of 2007 and the remainder in the first quarter of 2008, and that he only tracks a handful of 20,000- to 50,000-sf centers, such as ones anchored by the new Fresh & Easy small-format grocery store chain.
"Some of the guys who are reporting high, strong absorption, I'm not sure they are accounting for all anchor spaces that were vacated during the quarter," he says. "A handful of grocery stores, several furniture retailers that cater to the residential market and several Rite Aids all closed up shop and left in the second quarter, which is unusual in this market; we've never seen multiple anchor spaces vacated at the same time."
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