Los Angeles Tri-Cities Retail Market Report Q2 2026
Burbank | Glendale | Pasadena
Los Angeles’ retail market remains on relatively stable footing, supported by its large consumer base, diverse economy, and limited new development. In Q2, metro vacancy stood at 5.8%, while asking rents averaged $37.01 per square foot, despite declining 0.5% year-over-year. Development activity remains limited, with approximately 528,000 square feet under construction, helping to constrain new supply and support existing retail fundamentals. Market conditions vary across the region, with Burbank maintaining particularly tight conditions, including a 2.8% vacancy rate and asking rents of $41.63 per square foot. Glendale also remains relatively well occupied, with 5.3% vacancy and asking rents of $39.78 per square foot, while Pasadena carries a somewhat higher 7.0% vacancy rate but continues to command premium rents of $40.97 per square foot. Investment pricing across all three submarkets remains above the broader Los Angeles average, reflecting the desirability of established retail locations within these communities. Although rent growth has softened and the investment environment remains more selective, limited new construction and relatively healthy occupancy continue to support retail fundamentals across the market.
Los Angeles By the Numbers
Q2 2026 | Source: CoStar Group, Inc.
- Sales Volume: $1B
- Price Per SF: $403
- Cap Rate: 6.0%
- Vacancy Rate: 5.8%
- Rent Growth: -0.5%
- Asking Rent Per SF: $37.01
- SF Under Construction: 528K
- SF Delivered: 51.8K
- SF Absorbed: 455K
Market Overview
- Burbank’s elevated retail rents continue to distinguish the market, though recent demand has softened and vacancy has moved higher.
- Tight availability and minimal new development in Glendale continue to support some of the strongest occupancy fundamentals among the three submarkets.
- Pasadena retail posts stable occupancy, limited new supply, and strong asset pricing continue to support the market despite modest near-term leasing softness.
Supply & Demand Dynamics
Source: CoStar Group, Inc.
Los Angeles Population Growth
Source: Oxford Economics
Los Angeles is supported by one of the most diverse and dynamic metropolitan economies in the country, with major employment concentrations spanning entertainment and media, trade and logistics, technology, healthcare, professional services, aerospace, and tourism. The region benefits from its position as a global gateway for international commerce, a deep and highly skilled labor pool, and a large consumer base. While the metro remains exposed to shifts in consumer spending, housing affordability, and broader economic cycles, its scale, industry diversity, and global connectivity provide a strong foundation for long-term economic resilience and continued commercial activity.
Burbank Retail Asking Rents Hold Above $41/SF
Demand
Burbank’s retail market softened during the second quarter of 2026, with vacancy reaching 7.0% and net absorption totaling negative 18,800 square feet. Vacancy has generally moved higher from the tighter levels recorded earlier in the decade, reflecting some moderation in tenant demand. Asking rents remain elevated at $41.63 per square foot, although annual rent growth declined 0.6%. Rent growth has slowed considerably following several years of steady gains, suggesting that landlords have faced greater resistance to additional rent increases as market conditions normalize.
Rent Per SF vs Rent Growth
Source: CoStar Group, Inc.
Supply
Retail development remains highly constrained in Burbank, with no space under construction, starts, or deliveries during the quarter. Limited development has been a consistent feature of the market, with new supply arriving only intermittently in recent years. Approximately 12,300 square feet was delivered in 2025, following no completions in either 2023 or 2024. The absence of a development pipeline should help limit additional supply-side pressure and allow leasing activity within existing inventory to remain the primary driver of occupancy.
Completions vs Vacancy Rate
Source: CoStar Group, Inc.
Investing
Burbank’s retail investment market remained relatively quiet in Q2 2026, generating $11.8 million in sales volume. Average cap rates were approximately 5.9%, reflecting a notable expansion from the low-5% range prevalent earlier in the decade. Despite a more selective transaction environment, an average sale price of $430 per square foot indicates that Burbank retail properties continue to command meaningful valuations.
PPSF vs Cap Rate
Source: CoStar Group, Inc.
Investment Highlights
Volume
- $11.8M in Q2 retail sales volume
- Limited transaction volume points to a more selective investment environment
Pricing
- 5.9% average cap rate, with yields having expanded from the low-5% range earlier in the decade
- $430/SF average sale price, demonstrating continued pricing strength
Glendale Retail Vacancy Remains Tight at 2.8%
Demand
Glendale’s retail market remained relatively tight in the second quarter of 2026, with vacancy at just 2.8% despite negative 12,300 square feet of net absorption during the period. Vacancy has remained near the 3% level for much of the past several years, indicating relatively limited availability across the submarket. Asking rents averaged $39.78 per square foot, although annual rent growth declined 1.0%. The moderation follows several years of rent appreciation, with asking rents increasing from approximately $36 per square foot in 2019 to around $40 per square foot today. While near-term leasing conditions have softened, low vacancy continues to provide support for overall market fundamentals.
Rent Per SF vs Rent Growth
Source: CoStar Group, Inc.
Supply
Retail development remains highly constrained in Glendale, with no space under construction, no construction starts, and no new deliveries during Q2. New supply has historically been limited and uneven, with approximately 17,800 square feet delivered in 2025 following no completions in 2024 and only 3,000 square feet in 2023. Muted construction should help preserve the market’s tight availability and limit the risk of significant supply-driven vacancy increases in the near term.
Completions vs Vacancy Rate
Source: CoStar Group, Inc.
Investing
Glendale recorded $16.7 million in retail sales volume during Q2 2026, as investment activity continued within a more selective transaction environment. Average cap rates stood at 5.9%, continuing a steady upward trend from the low-5% range seen earlier in the decade as investment yields have repriced. Retail assets traded at an average of approximately $412 per square foot, reflecting continued investor demand despite higher required returns and more disciplined acquisition activity.
PPSF vs Cap Rate
Source: CoStar Group, Inc.
Investment Highlights
Volume
- $16.7M in Q2 retail sales volume
- Limited new supply and sub-3% vacancy continue to support the investment profiles of well-located retail properties
Pricing
- 5.9% average cap rate, with yields trending upward from the low-5% range earlier in the decade
- $412/SF average sale price, reflecting sustained valuations
Pasadena Retail Pricing Reaches $437/SF
Demand
Pasadena’s retail market entered the second half of 2026 with relatively balanced occupancy, as vacancy registered 5.3% despite 17,000 square feet of negative net absorption during the quarter. Asking rents averaged $40.97 per square foot, while annual rent growth declined 0.6%. Although near-term rent momentum has turned slightly negative, Pasadena has retained much of the pricing gained over the past several years, with average rents rising from roughly $37 per square foot in 2019 to approximately $41 today.
Rent Per SF vs Rent Growth
Source: CoStar Group, Inc.
Supply
Pasadena’s development pipeline remains inactive, with no retail space under construction, no construction starts, and no deliveries during Q2. This marks a sharp contrast with the sizable wave of new inventory earlier in the decade, when more than 200,000 square feet was completed in 2021 and approximately 85,600 square feet followed in 2022. Since then, development has slowed substantially, with only about 2,600 square feet delivered in 2023 and no completions in either 2024 or 2025.
Completions vs Vacancy Rate
Source: CoStar Group, Inc.
Investing
Pasadena generated $17.1 million in retail sales volume during Q2 2026, with transaction pricing averaging $437 per square foot. Investment yields averaged 5.9%, continuing the upward movement in cap rates that has emerged over the past several years. Cap rates were near 5.2% in 2021 and 2022 before rising steadily through 2024, 2025, and 2026, illustrating the adjustment in investor return requirements as market conditions have evolved.
PPSF vs Cap Rate
Source: CoStar Group, Inc.
Investment Highlights
Volume
- $17.1M in Q2 retail sales volume,
- No active development pipeline, reducing near-term supply risk and supporting the positioning of existing retail assets
Pricing
- 5.9% average cap rate, as required yields have moved higher from approximately 5.2% earlier in the decade
- $437/SF average sale price, highlighting the premium pricing achieved by Pasadena retail properties
