Newspaper article THE JOURNAL RECORD

Tulsa Retail Vacancy Rate Hits Two-Year Low

Newspaper article THE JOURNAL RECORD

Tulsa Retail Vacancy Rate Hits Two-Year Low

Article excerpt

Tulsa's retail vacancy rate ended June 30 at a two-year low of 12.6 percent, according to a new midyear report by CB Richard Ellis of Oklahoma.

But lease rates also declined from both year-end 2012 and a year ago, said report author Caitlin Boewe, even as Tulsa's construction activity slowly rose.

She projected that lease rates would rise through the rest of 2013, even as vacancy rates tighten further.

"I would like to say it would go under 12 percent," she said in a telephone interview Thursday. "That would be optimistic."

Boewe said Tulsa's improving retail occupancies followed a gradual nationwide strengthening. Tulsa's current mark proved the lowest since the rate ended June 2011 just above 12 percent. It had stood at 13.25 percent at Dec. 31 and 13.8 percent a year ago.

Six of Tulsa's 10 surveyed submarkets posted positive absorption in the first half of 2013, said Boewe. But that couldn't stop average retail lease rates from slipping to $10.32 at June 30 from the $10.60 at Dec. 31 and $10.42 at mid-2012.

Such sideways movements continued trends the market has endured the past three years, she said in the report. Just three of Tulsa's submarkets averaged increased rates through the first half of 2013, while one stayed the same.

The biggest improvement came in Tulsa's southwest market, where asking rates jumped to $16.66 from $14.45 at Dec. 31. That market, which includes the 1.5-million-square-foot Tulsa Hills shopping center, also posted the highest occupancy rate at 98.29 percent.

"Class A centers like Tulsa Hills, The Shoppes at Broken Arrow and South Town Market are the only sites where landlords experienced increased leverage due to high occupancy and tenant success," wrote Boewe.

The bankruptcy sale of Tulsa's second-largest shopping mall undercut overall results from Tulsa's six retail property transactions in the first half of 2013. …

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