Investors Take Notice as Increased Tourism and Job Gains Fuel Retail Demand
- Retail fundamentals held steady during health crisis. Orlando benefited from job growth that doubled the U.S. average prior to the pandemic, which translated to a level of resiliency during the health crisis.
- Reduced pipeline to benefit metro vacancy. Uncertainty from the pandemic and material shortages prompted developers to reduce construction activity in the metro, which aided the metro’s vacancy rate during the health crisis.
- Retail investors returned in force to Orlando in the second half of 2020, with transaction velocity reaching a two-decade high over the past 12 months.
- Private investors were more active in the market, acquiring older properties as many institutions were on the sidelines.
- Private investors were particularly active in the Lake County Submarket, targeting single-tenant net leased assets with yields in the 6 percent band.
- Nearly half of all transactions in the metro over the last four quarters involved out-of-state buyers.
* Forecast; ** Through 2Q
Sources: CoStar Group, Inc.; Real Capital Analytics