Consumers’ resiliency preserves standout performance. As the only commercial real estate segment to record vacancy compression over the 12-month period ending in June, the retail sector remains in a favorable position. A robust labor market that continues to outperform expectations is supporting consumer spending at brick-and-mortar retailers. Before 2022, monthly store-based sales, which exclude purchases made online or at restaurants and bars, had never eclipsed $300 billion. Since September of last year, that threshold has been surpassed eight times. In addition to strong store-based sales, consumers are dining out, with spending at restaurants and bars reaching a record mark in August. These dynamics are supporting positive net absorption, tight vacancy and record asking rents across the property spectrum. Should these trends continue, retailers will likely execute expansion initiatives, bolstering space demand amid a pullback in construction activity.