Retail continues to ride a post-pandemic wave that "has not let up yet," according to researchers from Cushman & Wakefield, who say shopping enter tenants will continue to seek out high-quality locations amid limited supply.

Retail vacancy in shopping centers clocked in at 5.7% in Q4, with 10.4 million square feet of net absorption and asking rents just south of $23 psf. Around 12.6 million square feet is under construction nationally, according to Cushman & Wakefield.

But despite those rosy predictions, "the economic outlook has worsened, and 2023 will undoubtedly be a more difficult year for retailers," Cushman experts say in a report breaking down the sector's fourth quarter 2022 performance, noting that by late last year,  some shoppers were already pulling back on purchases on discretionary goods. But they also say retailers catering to upper-income consumers "will be more insulated from a spending pullback as these households have elevated levels of savings and will be less impacted by price pressures."