ICSC Las Vegas: Real estate execs moving forward despite global uncertainty
The mood among commercial real estate executives at the recent ICSC Las Vegas show was that of optimism despite increased construction and fuel costs and wavering consumer sentiment.
While noting that for some retailers, the increased cost of rent due to a lack of availability has been hard to swallow, Mark Masinter, chairman of global retail at Newmark Retail Services, said that positivity was felt across the board at the event.
“I personally haven’t had one meeting where I felt negative sentiment from retailers, restaurateurs, investors or property owners,” he said. “For so many of the brands we are doing business with, physical retail is more important than ever. Even though there is macro-turbulence going on, there is a positive long-term outlook.”
[READ MORE: Spaced Out: Tight availability shifts leverage back to landlords]
The annual spring event came amid increased fuel and transportation costs due to the ongoing war in Iran and its effects, waning consumer sentiment, import tariffs and a persisting lack of new retail construction. Despite the economic pressures, Sandy Sigal, president and CEO of NewMark Merrill, noted that dealmaking was abundant at the Las Vegas show, calling retail the “chosen asset class.”
“The amount of money that is chasing deals is truly extraordinary,” Sigal said. “The pricing that we're seeing from a cap rate perspective is really incredible. On the tenant side, I feel there's rationalization going on, where tenants are really making sure the numbers work before they expand.”
Matt Mousavi, co-head of capital markets at SRS Real Estate Partners, echoed the optimism when it came to property transactions. He noted that SRS finished 2025 with $3.5 billion in transaction volume.
“Overall, I think that 2026 is going to be better than last year,” Mousavi said. “I do think there is some hesitancy in the market tied to rates and oil prices, and midterm elections always make people a little bit nervous. We continue to be in high growth mode as a company, and our tenants and buyers want to grow.”
As for the tenants that are looking to grow, not much has changed compared to last year, according to experts. Value retailers across the board, including Aldi, Ross, Burlington are still expanding at the fastest rates.
“Value retail continues to just be on fire – they continue to grow and want to grow faster,” said Scott Schnuckel, managing director at CBRE. “That applies to mass merchants and off price. Everything else has been pretty consistent. We've heard a little bit in our meetings about how luxury is remaining pretty resilient, along with entertainment.”
Sigal said that NewMark Merrill, which develops and operates retail centers in California, Colorado, Illinois and Washington, is still moving forward with new construction despite the increasing costs of doing so. Overall construction input (includes energy, materials and equipment) prices rose 1.7% month over month in April and are 7.0% higher than one year ago, according to the most recent Associated Builders and Contractors analysis of the U.S. Bureau of Labor Statistics Producer Price Index.
“Our market is working class neighborhoods with higher density where we'll be the dominant one or two players,” Sigal said, citing a new development on the way in Victorville, Calif., and a recently-acquired center in Chicago. “Everything we own is for the long term. Before we buy or build anything, we say ‘how are we going to set this center apart from everything else?’”
Centennial president and incoming CEO Paul Kurzawa added that developers are looking far beyond the cost pressures of today when it comes to ground-up construction.
“If you're spending a couple $100 million developing a project, you're not building it for today – you're on a five to 10 year horizon,” he said. “We haven't seen a material change in terms of retailers’ interest in signing deals. They're staying the course and expanding where they see fit.”
Much was made at ICSC Las Vegas about consumer sentiment, especially given the spike in gas prices that came following the beginning of the Iran conflict in February. Elizabeth Lafontaine, director of research at retail analytics firm Placer.ai, said that despite tariffs on imported goods and increased fuel costs impacting consumers’ pocketbooks, spending remains strong at the moment.
“Even though we've seen a lot of volatility, we have a consumer right now who really loves retail,” said Lafontaine. “Despite all of the macroeconomic headwinds, consumers are changing their consumption behaviors, but they're not necessarily willing to forego those retail visits overall. More frequently, consumers are willing to shop at a wider number of retailers than before, which has made them a little bit more discerning, but they are not necessarily willing to walk away from retail altogether.”
All things considered, retail real estate appears to be thriving in the first third of 2026, and executives have a positive outlook for the remainder of the year.
“In every category, great management teams are figuring it out, and great concepts are thriving,” added Masinter. “Coming here, I was optimistic. Leaving here, I'm very optimistic.”
