Research
SVN State of the Market Report 2025
RETAIL
Predictions of the Retail sector’s saturation and impending stagnation are far from new, and they all haven’t aged well. After contractions in the previous two years, Commercial Retail prices roared back in 2024, suggesting that prices may have over-corrected in the face of rising interest rates.
The success of open-air Retail in the post-pandemic years helps illustrate this hypothesis. According to a report by the Financial Times utilizing data from CoStar, the vacancy rate at open-air US malls stands at just 6.2%, the lowest in at least two decades.
Tumbling foot traffic at indoor malls during and after the pandemic made some analysts fear that e-commerce could cannibalize brick-and-mortar retail. However, although foot traffic never quite bounced back to the same levels as before COVID, data suggests that consumers continue to value in-person shopping. According to Visa’s 2024 holiday spending activity tracking, physical stores accounted for 77% of all holiday sales.
