Commercial vacancy rates, rents increase along Richmond Highway corridor
The vacancy rate for 284 commercial properties located along the Richmond Highway corridor between the Capital Beltway and Fort Belvoir has slightly increased over last year, according to the latest real estate data from CoStar.
As of June 30, 2022, the corridor had a total vacancy rate of 5.6% — an uptick from the 4.4% vacancy rate recorded in second quarter 2021. The amount of available space also has increased, from 171,669 square feet to 229,468 square feet over that same time frame.
One of the largest retail spaces available for sublease is the former Safeway site at Mount Vernon Square (7451-7455 Richmond Highway), which has 57,816 square feet of divisible space. The Safeway closed five years ago, and the site has remained vacant ever since, apart from hosting a COVID-19 vaccination clinic last year.
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The Southeast Fairfax Development Corporation (SFDC) has been in recent talks with both Safeway and KLNB, property manager for Mount Vernon Square, about possible usage of the space, including for gastronomic and recreational purposes.
Purchasing and leasing property along the corridor also has gotten pricier over the past year, the CoStar data shows, with the market rent rate per square foot rising by 2.6% to $28.57 and the market sale price per square foot ballooning by 13.4% to $333.
SFDC’s Executive Director Evan Kaufman attributes the cost increases to several broader trends, including post-pandemic rent increases and greater demand for commercial space as the corridor undergoes redevelopment.
“As redevelopment and new construction continue on the corridor, providing more options for people to live here, more demand will be placed on commercial and retail spaces, driving up rents,” said Kaufman.
He added that one of the prescriptions offered in the Fairfax County Economic Development Authority’s 2021 Richmond Highway Market Assessment Study is to view commercial rents through the same lens as affordable housing.
“We might need to look at subsidizing commercial rents for mom and pop businesses,” said Kaufman.
In recent months, some longstanding and more newly established small businesses have disappeared from the corridor. The Oraydes Café, an Argentinean bakery and gourmet shop established in 2020, closed its doors at 8859 Richmond Highway earlier this year. Meanwhile, a “For Lease” sign also has recently appeared at the Johnny Sub Shop at 8256-B Richmond Highway, next to Aldi. That business had been around for more than 30 years, estimated the leasing agent.
Not all the news is bad, however. Over the past six months, there have been several small business openings along the corridor, including Chalkboard Wings & BBQ at 8723-C Cooper Road, the Zema Market at 8714 Richmond Highway, and the Zen Press Juice and Café at 8120 Richmond Highway. Della J’s Delectables is also expected to open soon at Mount Vernon Plaza.