Oahu retail vacancy rate eases to 3.5%
Retail space is up from a record low of 2.1% at year-end 2006
Retail space at shopping centers on Oahu is still tight and rents are increasing, despite a slight easing of the vacancy rate to 3.5 percent in the middle of this year.
The 3.5 percent vacancy rate, recorded by Colliers Monroe Friedlander in its Oahu Mid-Year 2007 Retail Market Report, is up from the record low of 2.1 percent at year-end 2006.
RETAIL RENTS KEEP RISING
Average low asking rent: $2.81 per square foot per month
Average high asking rent: $3.58 psf/mo.
Average operating expense: $1.05 psf/mo.
Oahu vacancy rate: 3.5%
Source: Colliers Monroe Friedlander
But asking base rents have gone up four percent over the last six months, and are at an average of between $2.81 and $3.58 per square foot per month. That's not including an additional average operating expense of $1.05 per square foot per month.
Two new developments -- Outrigger Enterprise Group's Waikiki Beach Walk and Robertson Properties' Center of Waikiki -- brought more than 130,000 square feet of new retail space to the market.
Average asking base rents in Waikiki, on the high side, are at $16.87 per square foot per month. On the low end, they are at $4.46 per square foot per month.
Leasing activity is under full swing at a number of new retail centers under development, including the Avenue Shops at Safeway Center on Kapahulu, Pearl City Gateway and Kapolei Commons.
An additional 1.3 million square feet of space should be added to the retail inventory on Oahu by 2009.
DeBartolo Development Co., selected last fall by the Department of Hawaiian Home Lands to build its regional mall in Kapolei, has selected Colliers as its leasing agent.
When built, the mall will bring 1.3 million square feet of mixed-use space to the market.
Mike Hamasu, Colliers' research director, said a slowdown in retail is anticipated by the end of the year, but that vacancy rates aren't expected to change much.
"I don't see a drastic uptick any time soon," said Hamasu.