There aren’t many commercial brokers across the Midwest who will point to the retail sector as one that’s performing well.
Then again, not every commercial broker works in Lexington, Ken.
Al Isaac, president of Lexington’s NAI Isaac, does. And he’s seen the retail sector in his market perform surprisingly well.
According to NAI Isaac’s year-end survey, the retail vacancy rate in the Lexington market stood at a strong 7.69 percent. And Isaac told me that if you discount the strip centers and retail buildings that either should never have been built or are functionally obsolete, that vacancy rate falls closer to 5 percent.
In the world of retail today, that qualifies as one terrific vacancy rate.
There’s a simple reason for Lexington’s low vacancy rates: The city didn’t overbuild before the real estate bust.
“There is not a lot of construction going on now, either,” Isaac said. “We have been conservative here in Lexington. That’s helped us get through these slow times.”
Isaac is confident enough in the health of Lexington’s retail market that he’s predicting new retail construction during the rest of 2012.
“I do think in 2012 that we will see some planned projects both in the suburban office and suburban retail markets come to fruition,” Isaac said.
