Savannah Multi-Tenant Retail Market Report
Market Overview
With a strong local economy characterized by population growth and tourism, Savannah’s retail market remains a significant interest for investors. The leisure and hospitality sector, employing approximately 15% of the labor force, plays a significant role in Savannah’s economy, with tourist spending exceeding $3 billion. Savannah’s economy has rebounded from the pandemic, with job growth reaching 13,200 new positions since February 2020, representing a 7% increase. Key sectors like logistics, distribution, and port-related industries drove growth during the pandemic, while more recent employment gains have been observed in tourism, education, healthcare, and manufacturing. Savannah’s appeal as both a tourist destination and a residential hub continues to attract visitors and new residents, contributing to its economic vitality and population growth.
Market Performance
Following a decrease to 5.2% vacancy in 2020, sustained absorption surpassing new deliveries has resulted in a record-low vacancy rate of 3.2%. The annual rent growth exceeds historical averages at 4.1%, outpacing the national benchmark, supported by a relatively modest development pipeline. Savannah saw several deals close, totaling over $178 million in transactions, with market pricing averaging $220 per square foot. High-end urban properties, particularly those situated in key tourist and shopping areas, continue to attract investor interest, with some transactions closing at lower-than-average cap rates.
Despite a 25% decrease in retail sales volume, the total remains notably above the 10-year average, reflecting resilience in the face of economic uncertainty and rising interest rates.
Savannah By The Numbers | Last 12 Months | Source: CoStar Group
- Vacancy Rate: 3.2%
- Rent Growth: 4.1%
- Deliveries in SF: 120K
- Absorption in SF: 194K
- Sales Volume: $178M
To read a report on Augusta, GA, retail, click here.
