Northern Nevada
By Gary Tremaine & Amanda Brierton | Dickson Commercial
Retail had its strongest quarter of the year for sales with just over $188 million and 25 total sales in Q4. There were multiple shopping centers and larger multi-tenant sales that took place before year end. In west Reno, CAI Investments purchased the Cabela’s in Verdi for $39 million ($305.27 P/SF). The market has limited inventory and single tenant net leased deals priced under $5 million are still seeing strong buyer interest. The buyer demand for well-priced product with credit tenants remains as high as it’s been in recent memory.
Reno’s retail leasing market was consistently steady throughout the year, but finished with a strong Q4. The region started 2021 at a 6.8 percent vacancy rate, and it gradually decreased each quarter until a significant drop at the end of the year to 4.9 percent. The largest transaction this quarter was BlueZone Sports, joining one of the newest redevelopment projects – The Reno Public Market. They took down 11,786 SF, and will be joining Sprouts Market, CVS, Fifty Fifty Brewing, and many more.
Overall, quite a few larger retail spaces are being leased up. Spaces that have sat vacant for 10 plus years and over 20,000 SF are now seeing new businesses occupy them. If these larger junior anchor spaces continue to fill, the vacancy rate will continue to drop significantly.
Southern Nevada
By Liz Clare | Avison Young Las Vegas Office
The last quarter of 2021 for the greater Las Vegas retail property sector ended on a high note. With an overall vacancy rate of just under 6 percent, which is down slightly from the previous quarter. The strength of the retail sector goes hand-in-hand with the population growth in the region and the shrinking unemployment rate.
In step with the first three quarters of 2021, Q4 continued to experience a high velocity of retail leasing activity. Spaces have been filling up that were previously vacant for several years, especially in the big box and junior box sectors. Conversely, credit unions and banks have been closing some of their locations as they are able to conduct a growing amount of business online. This is a welcome trend for other retailers as in many cases, financial institutions are well-located in highly visible retail areas and subsequently aren’t vacant for very long.
As consistent with the previous several quarters, quick service restaurants (QSRs) with drive-thrus are the most sought-after property type from both tenants and investors. Inventory for all retail asset types is tight for investors. With a huge amount of capital waiting on the sidelines, when a retail asset is placed on the market, there is a significant amount of property tours and competition. With high tenant demand and rents that are higher than pre-pandemic levels, investors see the Las Vegas market as a solid, long-term and favorable region to place capital.