CBRE: Retail rents increase 2.4% in Q2
Retail rents are continuing to tick upwards amid a lack of new construction.
CBRE’s Q2 2026 data found that average retail asking rent increased by 2.4% year over year to $24.79 per square foot, which it said was supported by historically low construction completions and four consecutive quarters of positive net absorption. The retail availability rate was unchanged at 4.9% in the second quarter.
The figure follows an ongoing trend as retailers compete for a small amount of available space. In the first quarter of the year, CBRE’s data found that average asking rents also increased 2.4% year over year to $24.59.
While retail availability held steady overall, the gap between downtown and suburban availability rates narrowed by 10 bps in the second quarter to 118 bps, as downtown availability declined modestly while suburban availability remained unchanged. Although the downtown availability rate decreased slightly in the second quarter, CBRE says it has increased by 82 bps since 2022. In contrast, the suburban rate has decreased by 51 bps over the same time.
Perhaps unsurprisingly, Sun Belt markets accounted for eight of the top 10 lowest availability rates in the second quarter, with Raleigh and Charlotte, N.C., Louisville, Ky., Miami, and Nashville, Tenn., having the lowest rates.
The Sun Belt also led the way when it came to new construction in the period. Houston was the top market for construction completions in the second quarter with 606,000 square feet,, followed by Orlando (593,000), Dallas (580,000) and Phoenix (399,000).
Southern markets accounted for eight of the top 10 markets for completions due to strong population growth driving demand for new retail. Five Texas markets led by Dallas were among the top 10 nationally for construction completions over the past four quarters.
Notably, Chicago and St. Louis ranked among the top 10 in new construction completions for the first time this year.
[READ MORE: Study: Retail property sale price per square foot increased 15% in June]
When it came to absorption by property type in the second quarter, CBRE noted that, excluding freestanding retail, the power center segment led absorption, with nearly 1.6 million square feet. Neighborhood, community & strip centers saw negative net absorption for the first time since the second quarter of 2025 due to apparel boutique closures and an overall contraction in retail bank branches.
