Retail mall vacancies fell to 7.8 percent in the third quarter, down from 7.9 percent in the previous quarter, according to a report from real estate research firm Reis Inc.
Higher end regional malls are helping to fuel the resurgence, as smaller retail space in community centers continue to decline.
Asking and effective rents for shopping centers also rose for a third straight quarter, according to the report, while rent growth rate also grew by 0.4 percent, which is unchanged from the second quarter.
Nationally, the vacancy rate for neighborhood and community shopping centers rose 10 percent, up 10 basis points compared to the second quarter.
“We continue to expect vacancy rates for neighborhood and community centers to slowly drift lower and rent growth to increase at a slightly faster rate,” Barbara Denham, a senior economist at Reis, said in a statement.
Although there was an additional 2.53 million square feet of new neighborhood and community center space built in the third quarter, which reached the highest quarter increase in four years.
“With job growth and gains in median family income across the U.S., the retail recovery should continue,” Denham added.
One sign of trouble noted in the report, however, was that the net absorption of retail space in the third quarter fell more than 96 percent, with only 143,000 square feet of net absorption.