OKC metro retail industry sees growth despite challenges

A new report from Price Edwards & Co. highlights the resiliency of the Oklahoma City retail industry. The mid-year retail report paints a vivid picture of the current state of the retail industry, both on a national and local scale. Price Edwards & Co. Senior VP Jim Parrack offers valuable insights into the retail market's recent performance and its impending transition from rapid growth to a more moderate pace.  

Surprising growth and resilience 

One of the most striking observations made in the report is the resilience of the retail market. Since the onset of the economic recovery, the retail sector has not only recuperated from its losses but has surpassed pre-pandemic sales figures. This remarkable recovery has been accompanied by a surge in occupancy rates and an influx of new tenants, painting a promising picture for the industry. 

National and local success stories 

Nationally, retail vacancy rates currently sit at 4.2%, near their all-time low, according to CoStar data. Oklahoma has been no exception to this trend. Notable developments include the construction of high-end mixed-use properties like the Oak at Pennsylvania and Northwest Expressway, Stacks in Yukon, and the upcoming Andretti's Indoor Karting and Games at The Half.  

Parrack noted that not all news has been favorable, with the bankruptcy of well-known brands such as Bed, Bath & Beyond, Tuesday Morning, Party City and David's Bridal. Fortunately, many of the vacant spaces left by these retailers have already found new occupants. 

Challenges on the horizon 

Despite the current optimism, the retail industry is not without challenges. Parrack points out several factors that could potentially dampen the market's growth trajectory. These include: 

• Depletion of pandemic funds: Consumers' excess savings from pandemic relief programs are dwindling, potentially impacting their spending habits. 

• Increased borrowing: A rise in credit card borrowing may not be sustainable in the long term. 
• Economic uncertainty: The possibility of a recession, an impending negative presidential election and potential increases in unemployment all contribute to uncertainty in the market. 
• Consumer confidence: Fear among shoppers due to economic instability could strain the retail industry. 

A reason for optimism 

Still, Parrack said in the report, there are several reasons to remain cautiously optimistic.  

“There remains talk of a soft landing for the economy, given limited construction, good wage growth and lower inflation. For Oklahoma, the news is even better in that we are in a better starting place than much of the rest of the country and the energy business tends to be somewhat countercyclical. Will we most likely still see a downturn at some point? Yes, but expect it to be moderate.” 

You can read the full report on the Price Edwards & Co. website.