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The Greenville-Spartanburg retail market saw vacancy rise for the first time after several consecutive strong quarters, a blip in an overall positive trend created by new anchor vacancies in aging shopping centers, according to Colliers market analyst Will Schenk.

Schenk said in a Q4 2024 Greenville-Spartanburg retail report the new openings may simply unlock some anchor and junior anchor spatial liquidity for market entrants following the area’s rapid population growth.

Notably, Schenk said, rent spreads continue to grow between new construction and existing properties, creating windows for renovation in favorable locations or redevelopment of functionally obsolete spaces as tenant upfit costs create a barrier for tenants evaluating newly built shell spaces.

Vacancy jumped to 3.59 percent as net absorption of 21,932 square feet was outpaced by 179,280 square feet of new deliveries.

Shop space rental rates rose to $20.66 per square foot, while 6,000 square feet of new construction are in progress within tracked submarkets.

Total inventory grew to 29,256,095 square feet.

Schenk reported investment sales activity spiked in Q4 to $89.4M, the highest level since Q2 of 2022, as investors sought to deploy dry powder in markets with strong overall fundamentals.

The overall trendline remains downwards, though, as financing costs remain high and market rent growth has been gradual relative to other areas of the state.

Per capita real consumer spending showed limited year-over-year growth, a national pattern as consumer confidence wavered and discretionary spending remained largely stagnant as unemployment rose over the course of the year — though the Upstate’s steady job growth has smoothed the impact, Schenk said.