Retail vacancy on the Country Club Plaza fell to 7.4 percent in the third quarter, the first time it has been below 8 percent since 2019, according to brokerage data published this week.
What filled the space
Nine leases signed in the quarter, and only one was apparel. The rest were medical, wellness, food and financial services — a mix that reflects both consumer demand and the reality that national apparel chains have largely stopped expanding in malls and lifestyle centres.
- Medical and dental: 3 leases
- Food and beverage: 3 leases
- Fitness and wellness: 2 leases
- Apparel: 1 lease
Service tenants pay less per square foot than apparel did, typically $42 to $55 against $60 to $75. But they sign longer terms and default less often, which landlords have decided is the better trade.
The rent trajectory
Asking rents have been flat at roughly $48 per square foot for six quarters. That flatness is doing the work: it is what convinced several of these tenants to sign at all.
A vacancy number going down is good. A vacancy number going down because rents stopped rising is a different kind of good.
A retail broker familiar with the district
The remaining problem
The vacancy that remains is concentrated in the largest floor plates — three spaces above 8,000 square feet that no service tenant wants and no apparel tenant will take. Those may need subdivision, which is expensive and requires landlord capital.
Danny Okafor
Danny writes about jobs, small business and the regional economy. He spent six years covering commercial real estate before joining the newsroom.
