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Retail construction remains strong in S.C.; Charleston leads state
Last year, home sales set a record across South Carolina, and while sales are slightly down across the state for the first quarter of 2019, they aren't expected to dip dramatically.
Underpinned by steady job growth and relatively stable home sales amid attractive interest rates, household income and consumer demand is leading a wave of new retail development across the state, and especially in Charleston.
"South Carolina metros have settled into a period of steady growth," California-based real estate investment firm Marcus & Millichap said in its latest retail report for the state.
The retail vacancy rate in Charleston stands at 3.5 percent, in Greenville-Spartanburg at 4.1 percent and in Columbia at 6.0 percent. All three areas are expected to see further dips in vacancy by year's end, according to the real estate firm.
Generally, a vacancy rate below 10 percent is considered a healthy market.
While more retail development is slated for the remainder of the year in the state capital and Upstate markets, the Charleston region, with 6,900 jobs created in the past 12 months ending in March, is experiencing the greatest surge in new retail construction.
"These robust employment figures are driving the expansion of retail developments both on the single-tenant and multi-tenant fronts," said Ben Yelm, regional manager of Marcus & Millichap for the Carolinas and southern Virginia, of the Charleston market.
Nearly 600,000 square feet was completed in the Charleston region in the 12 months through the first quarter of this year while another 700,000 square feet are projected to be added for the rest of 2019, according to the real estate firm.
"With all the new construction we may finally see absorption levels fall behind completions for the first time since 2013," Yelm said.
Despite new retail construction in Charleston, the vacancy rate is expected to remain low along with slowing rent growth. Over the previous 12-months ending in March, asking rents grew 3.5 percent compared to 9.6 percent in the prior 12-month period.
"Overall the market remains attractive for both buyers and sellers with no clear sign of a slowdown in the near future as the market continues to grow from both a population and employment standpoint," Yelm said.
Also, both local and out-of-area investor demand remains high for quality retail properties in the state's major metro markets.
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Home sales across South Carolina slipped during the first three months of 2019 after a blistering pace last year that set a state record.
By the numbers
3: Number of new hotels coming to the Charleston peninsula after winning approval earlier this week from a key zoning board.
92: Number of home closings reported by Charleston-based real estate firm The Cassina Group during the first quarter to set a new record.
21,535: Square footage of South Carolina's first GreenWise Market organic and natural food store by parent company Publix. It opened Thursday in Mount Pleasant.
This week in real estate
+Gaining ground: A longtime mapping mistake from the formation of Dorchester County more than 100 years ago recently led to Berkeley County gaining 2,900 acres with 186 residential structures.
+Space available soon: Dressbarn is closing all 650 stores, including its last Charleston-area shop in Summerville.
+On the edge: A Charleston mayoral candidate, who also sits on city council, questions the city's involvement in leasing space in a new office building under construction in the WestEdge development.
Interest in raising historic houses in downtown Charleston is on the rise after a spate of floods in recent years.
- Home ownership workshops: Origin SC offers free workshops on home ownership, credit and budgeting; June 1-27 at various times.
- Selling new vs. resale: A four-hour course and workshop detailing the differences of selling new construction vs resale; hosted by Charleston Trident Association of Realtors; 9 a.m.-1 p.m. Wednesday, May 29. Cost: $55/members, $70/nonmembers.
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