Retail Market Rate Increases
Utah Resurgence of Strip Malls
There are many factors contributing the resurgence of the strip center, but leading factors include very little market availability of commercial space in anchored centers throughout Utah as well as the rising cost of construction and inflation which is leading to an increased lease rate. According to Mountain West’s research department retail lease rates increased by 5.58% from Q1 2020 to Q4 2021. So, the historically less desirable in line strip centers have become the affordable answer to rising inflation and cost of new construction.
Restaurants Took a Hit During COVID
Utah lost about 250 restaurants due to the pandemic, but even with the tight labor market and concerns about rising food costs due to inflation and supply chain issues, Utah’s food and beverage industry seems to be faring well and experiencing modest growth in 2022.
Work Force Shortage is Impacting Retail Spaces
To begin with, Utah has historic and current unemployment rates well below the national average, and strong economic growth. Additionally, some of the most recent contributing factors to workforce shortages include significant migration from big companies in tech and life sciences looking to capitalize on Utah’s skilled labor force by adding offices along the Wasatch front and the construction boom we are experiencing throughout the state which ties back into the significant economic growth we are seeing statewide.
We saw a major shift of labor force at the onset of the pandemic.
“Many Utah residents working in food and beverage or hospitality that were laid off or furloughed due to pandemic closers began new careers in the as skilled labor for the thriving construction industry,” agent Stephanie Buranek said.
Additionally, many people who found themselves unemployed during the onset of the pandemic started ne small businesses with a year of year increase over approximately 5,000 new small business in 2020 compared to 2019.
Employers regardless of the industry are having to get creative to retain talent. Providing a positive, flexible, and fun work environment is a focus for many Utah companies. For some sectors with high turnover like the restaurant industry these employers instead of mining from an existing pool of workers are starting from scratch and training people looking to jump into a new career.
