Switcheroo from the pandemic, not much vacant retail space these days.

I'm David Brancaccio.

4.1% of retail space in America is empty, meaning most of it is occupied.

That's according to a new report out this morning from the commercial real estate firm JLL.

That's near an historic low, but that said, construction of new retail space has been sluggish, as Marketplace's Henry Hep reports.

There's pretty strong demand for retail space, so rents have been climbing, says Keisha Virtue at JLL.

But new retail in desirable locations is still pretty expensive to build.

Material costs, labor costs, land costs, all those factor in.

The problem is developers can likely make more money right now building other kinds of properties,

says Brandon's Fackett co-star.

If I'm going to have a higher return by building multifamily, by building medical office,

that's where I'm going to

choose to allocate my time and resources. A bunch of store closures might free up more retail

space soon, think Walgreens, Party City, and Macy's. That's happening, Svec says, because there were

fewer closures post-pandemic as cash flush consumers flocked back to stores.

Certain businesses that maybe had business models that were lacking or store fleets that

were underperforming were able to mask that because of this large overall boost in consumption.

But now consumers have gotten a little more discerning with their money, so more chains

are closing locations. So retailers that are growing are working with what they can find, says

Angie Solonky at Colliers. I think the retailers are getting much more sophisticated on their store

operations, allowing them to be more nimble in going larger or going smaller and adapting to what's available in the marketplace.

Meaning you might soon see a five below or dollar general in a former Walgreens.

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