The total retail market in Las Vegas now totals approximately 51.8 million square feet, including 516,300 square feet added during the third quarter. The additions included several pre-leased, user-specific buildings--including two Target stores, a Glazier's Food Marketplace store and a The Home Depot store—that contributed to the overall positive net absorption, according to AA. An additional 810,000 square feet is actively under construction—including a Lowe's-anchored center in the northwest and Tivoli Village at Queensridge--while 7.5 million square feet remains on the drawing board. Several projects have been delayed.

"Following the Federal Reserve Chairman's statement that the recession is 'very likely over' and continued contraction in the Las Vegas economy, many are questioning whether any meaningful recovery has actually taken hold in southern Nevada," AA principal Brian Gordon says. "While economic output may ultimately report growth at the national level this quarter, pullback in consumer spending, construction activity, overall employment and consumer confidence at the local level suggests the region will continue to experience a rough ride well into 2010. Retailers are on the front lines as residents and businesses have shifted their mindset and monitor every dollar they spend. This trend is expected to continue, translating into relatively weak demand for commercial retail space for the next several quarters."

Although overall vacancy is back below 10%, it remains 330 basis points above the 6.6% availability rate in the same year-earlier period, which itself is well above the market's 10-year historical average of 3.9% for anchored retail centers. The lowest average vacancy by product type was power centers (6.8%) while the highest average vacancy was found in neighborhood centers (11.9%).