Several large tenant move outs caused overall Charleston vacancy to ramp up 14
basis points quarter-over-quarter to 8.01 percent in second quarter. Though East
Cooper and North Charleston were the only submarkets with increasing vacancy rates,
rental rates across the market were impacted by the pause in leasing momentum and
asking face rates sputtered to an average $12.76 per square feet, which is
3.7 percent less than recorded one quarter before.
With signs that the economy is improving, there is a movement towards more risk-taking
by expanding existing businesses or opening new ventures, especially franchises,
to capitalize on an anticipated upswing. The Downtown area is poised to benefit most
from this entrepreneurship and the types of spaces seeing the most competition and
ultimately being leased has shifted to lower-cost second- and third-floor spaces,
as well as carriage houses. Typically offering rental rates 50 to 75 percent off of
first-floor spots on King Street, these alternative retail options are great incubator
spaces that are extremely conveniently located for customers willing to go up a flight
of stairs or to look behind a street-facing building.
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