Recently I feel like a lot of the market news is tending towards redundancy. Times are bad, and I hate counting the ways in which things have made a downward turn. Often times we have to remember that the problem is not purely economic, but can also be a symptom of over building.
This can be seen in recent numbers highlighting vacancies among retail properties. To be sure there is an economic factor as well, but at some point we have to begin to wonder when we have simply outbuilt the market. Currently there is about an 83.6% occupancy rate in DFW retail properties. This is down from close to 90% in 2005. It isn’t simply just a spurious factor that during this same time frame 22 million square feet of retail space was being built. Ain’t nobody using all that space (net absorption).
And guess where it’s worst? North Richland Hills to the tune of a 12% decline. Remember North Hills Mall? It just stood there vacant while the California owners fought over who would get the remains. While they were in court the entire area saw a serious exodus from retail space.
