Commercial Real Estate, Capital, Insurance, Leasing & Management

Ask the Expert: How Are Construction Supply Shortages and Inflation Impacting Retail Real Estate?

Published By: 

The pipeline for new retail development here in Florida is extremely robust due to pent up demand following the COVID-19 pandemic. However, current supply and demand discrepancies in the commodities market are creating challenges for builders, as well as retailers looking to expand.

First, widespread supply shortages are causing major delays in the delivery of essential building materials such as lumber, steel, copper and cement. These delays are expected to drag out construction timelines for at least another nine to twelve months, impeding expansion plans and openings for retailers. Inflated commodity pricing is also leading to increased construction costs, driving retail owners and landlords to push asking rental rents higher in order to recover some of the costs.

In some cases, occupiers are opting to retrofit existing spaces instead of building new to save money and time. Certain types of retailers, such as Quick Service Restaurants (QSRs), are turning to alternative building materials – like metal gauge framing instead of cement – to get projects to the finish line faster.

Whether you’re an owner or occupier, flexibility will be key to navigating retail real estate over the next year. Having a reliable construction team who can maximize your efficiencies is crucial to making larger-scale deals work.

Alex Wright, Senior Director, Retail Landlord Representation

let's Connect

drop us a line

Privacy Overview
Franklin Street

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.