U.S. Mall vacancies hit 11 year high causing concern for

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Despite a slight increase in U.S. retail sales, storefront and strip mall vacancies have hit an 11 year high, climbing over 9%. This should be of concern to many of the EB-5 visa holders who have invested in projects which are commercial and retail real estate related. These would include those EB5 projects which have a component of retails sales and have included leasing commercial & retail space in their properties to tennants for job creation purposes necessary to lift the conditional resident status at the application of the I-829 and repayment of principal in their plans and projections.

This continues as trend which we saw at the end of 2010 and does not show signs of reversing anytime soon. There are several reasons for the high vacancy rates:

The continued U.S. recession and tightness of consumer credit and spending
Developer's overbuilt during the last decade (excess inventory)
Consumer's are increasingly using the internet to make retail purchases

Several large retailers (Big Box) are increasingly looking at leasing much smaller spaces to ensure that they have a footprint in the community, but with a far lower overhead. An example of this would be Best Buy which traditionally leases space from 20,000 - 30,000 square feet to leasing from 1,500 to 10,000 square feet. Mall owners are countering this trend by enticing non-traditional tennants such as schools, churches and medical facilities.

Despite the marketing to these non-traditional tennants, analysts at USAdvisors.org forsee this trend continuing and caution prospective EB-5 immigrant visa investors to carefully evaluate the need for additional commercial and retail inventory coming into this depressed market when considering making an investment into an EB5 visa project. Two stories from American Public Media's Marektplace on the mall vacancies can be found here:

Vacancies at local mall hits 11 year high

U.S. malls loosing tenants to online shopping and depressed U.S. economy

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