Greater Boston, MA Retail Market Report Year-End 2025

The Greater Boston retail market closed 2025 with solid fundamentals and continued resilience. Sales volume totaled $1.9 billion, reflecting sustained investor interest despite broader capital market challenges. Assets traded at an average 7.3% cap rate and $238 per square foot, indicating pricing stability amid higher borrowing costs. Market conditions remained tight, with vacancy at 3.2%, supported by steady tenant demand. Asking rents averaged $24.93 per square foot, posting 2.5% year-over-year growth, signaling continued pricing strength. Leasing activity was robust, with 3.0 million square feet leased during the year. New supply remained disciplined, as 488,000 square feet were delivered while 485,000 square feet remained under construction, helping maintain balance between supply and demand.

Key Highlights

Retail vacancy in Greater Boston remains tight at 3.2%, reflecting strong tenant demand and limited available space. While vacancy has edged slightly higher from recent lows, availability remains well below historical norms, supported by steady leasing activity and minimal speculative supply.
Average asking rents reached $24.93 per square foot, continuing a gradual upward trend. Rent growth has been modest but consistent, underscoring landlord pricing power in a low vacancy environment, particularly for well-located and necessity-based retail assets.
Construction activity remains stable, with approximately 485,000 square feet under construction, helping limit supply-side pressure. Retail sales volume totaled $1.9 billion, as investors remained active despite capital market volatility, favoring stabilized assets with durable income.

Market Demographics

Source: CoStar Group, Inc.

Unemployment Rate: 4.4%
Current Population: 5,067,326
Households: 1,998,512
Median Househols Income: $118,293

Boston Retail Sales

Retail investment activity in the Greater Boston market remained active, with transaction volume showing periodic surges tied to portfolio trades and larger single-asset deals. Quarterly sales volume fluctuated meaningfully, ranging from approximately $325 million to over $700 million, reflecting shifting investor sentiment and deal timing amid evolving capital market conditions. Periods of elevated activity were driven by high-quality, well-leased assets, while slower quarters reflected pricing discovery and more selective underwriting. Despite this volatility, overall liquidity remained intact, supported by continued interest in grocery-anchored and necessity-based retail. The ability of the market to repeatedly generate strong sales volume underscores investor confidence in the long-term stability and income durability of Greater Boston retail assets.