OC, San Diego Retail On Road to Recovery

NEWPORT BEACH, CA-Soft retail demand will persist in Orange County this year, although the improving labor market should slow the pace of NOI declines and ultimately set the stage for a recovery, according to the 2010 National Retail Report by Marcus & Millichap Real Estate Investment Services. While resumed employment growth is a welcome sign for retailers, local economic weakness persists, as payrolls have contracted by nearly 125,000 positions since the peak in late 2006, the report says.

“Limited investment activity in Orange County will persist this year, especially for multi-tenant properties,” says Joseph V. Cesta, regional manager of Marcus & Millichap’s Newport Beach office. “Prospective buyers largely remain on the sidelines, waiting for clear signs of a local economic recovery.”

Included in the firm’s report is a snapshot analysis that ranks 44 retail markets based on a series of 12-month forward-looking supply and demand indicators. Orange County moves up six places this year to No. 7.