Entering the third year of the pandemic, San Antonio retail remains resilient.
Overall vacancies in San Antonio’s retail market have dropped to 4.7 percent from 5.7 percent this time last year, according to a report by NAI Partners.
Demand for retail space in the Texas city outpaced supply last month for the first time since 2016. Approximately, 270,000 square feet of both new leases and renewals was recorded in January 2022 alone. Notable leasing activity included two tenants taking over the 141,606 square foot former Sears location in South Park Mall off Monarch expressway. One tenant is Fitness Connection, which is set to open a 71,000-square-foot facility. The rest of the space has been sold to an undisclosed tenant, possibly a family entertainment center.
Taking move-outs into consideration, the net increase in leasing activity was up 400 percent year over year. Availability, which NAI defines as move-ins minus move-outs, was down to 6.2 percent compared to 7.2 percent in January 2021. In terms of space, last month saw a jump from 71,000 to 381,000 square feet year-over-year.
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The total square footage of retail space under construction dropped from 1,126,428 to 742,034 year over year. San Antonio alongside its fellow Texas metropolitan areas have risen as major targets of developers in recent years, however rising construction prices, community resistance and under-developed infrastructure have become significant roadblocks for companies looking to cash-in on these fast-growing markets.
The city’s growth in retail was matched by its growth in residential sales. The average price of a home sold in San Antonio increased 17 percent to $351,226, the median price appreciated by 18 percent to $304,700, according to the San Antonio Board of Realtors. The national average increase in January was 10.3 percent.