Vacancy in the Retail market continues to tighten as demand from retailers remains high and new construction is repressed by high construction costs.
New construction may be hindered by high construction costs, however some projects are able to successfully move forward with spec buildings and build-to-suit options. Many of these are occurring in grocery-anchored centers such as the pads in front of Costco and Winco on Chinden Blvd in North Meridian. New buildings on these pad sites are a mix of unanchored strip centers and bank or quick service restaurant sites.
With strong in-migration metrics bolstering the Boise MSA and surrounding markets, retail growth will likely continue its upward trajectory. Population growth for the Boise MSA is estimated to be over 2.1 percent, a dramatic difference from the 0.6 percent national average. Growth estimates for periphery markets like Star and Kuna are even higher than the Boise MSA, with estimates from Site To Do Business closer to 3.2 percent and 2.9 percent, respectively.
Ada and Canyon counties saw a combined 7,500 single family home permits pulled in 2021 and another 1,600 were pulled in the first quarter of 2022. With many consumers still preferring to shop in-person, brick and mortar stores and restaurants will continue to be in high demand from this incoming population.
For more information on the current state of the retail market, you can read our current quarter's Retail Market Report or subscribe to receive quarterly updates.