The retail sector in Albuquerque, New Mexico has gone through some turbulence with some key fundamentals, but some improvement is expected in the short-term, a fourth quarter and full year 2024 report from Colliers finds.
For one absorption was negative at the end of the year at -123,400, with the vacancy rate inching up to 6.39 percent in the last three months of the year, mostly due to a “turnover in anchor space.” But many of those spaces are leased or are being built specifically for future tenants, according to Colliers. Vacancies were the highest in the Southeast Heights submarket, at 15.36 percent. Downtown and the University submarkets were the next highest, with 11.74 percent and 10.58 percent, respectively. More specifically, urban and neighborhood retail accounted for about a third of overall vacancy.
Asking rates averaged $15.49 per square foot. However, Colliers refers to the figure as “artificially deflated by low availability amongst premium retail spaces, which command much higher lease rates, whereas a large sector of market vacancy is comprised of functionally obsolete space.”
Availability rates averaged 7.14 percent.
While the overall market performance on the leasing activity was not revealed, some of the top deals were listed. The top lease involved 22,529 square foot 840 Juan Tabo Blvd NE. That was followed by 5,060 square foot 616 Central Ave SW, and 1,370 square foot 9784 Coors Blvd NW.
The top three sales involved 5,800 square foot 130-136 Jackson St NE, 5,019 square foot 840 Juan Tabo Blvd NE, and 3,050 square foot 1401 N Rennaissance Blvd NE North I-25.
While Albuquerque experienced some issues in 2024, Colliers noted that consumer spending was resilient, even with economic uncertainty persisting. GDP in the market grew by 2.18 percent year-over-year.
Going into 2025, the CRE firm forecasts that absorption in the city’s retail sector will rise “as tenant improvements reach completion.” Also, it added that older retail concepts will make room for “new and vibrant ones.”
Source: “Albuquerque Retail Sees Vacancy Increase, But New Leases, Sales Signal Potential Recovery”
