CBRE Reports Tucson Retail Big Box Absorption in 2024

Retail big box leasing activity throughout the Tucson area was robust in 2024. Forty-two spaces greater than 10,000 sq. ft. were available at the end of 2024, resulting in 1,674,328 sq. ft. of vacant big box space throughout the market compared to thirty-two spaces of greater than 10,000 sq. ft. and 1,289,000 sq. ft. of large vacant retail space recorded at the end of 2023, according to CBRE's research.

Locally, Tucson had two large retailers complete their construction in 2024: Fry's Marketplace opened in over 150,000 sq. ft. in north Marana, and Home Depot opened in 100,000 sq. ft. in Tucson’s growing southeast valley. Retail follows residential rooftops, and the community’s growth areas have attracted numerous new retailers and service businesses, expecting to continue to see new construction to meet the residents’ needs. However, interest rates and construction costs have not seen reductions, thus tempering some expansions.

A wave of large space vacancies flooded the market and the nation in 2024 with the closure of some Walgreens and CVS stores, Conn’s, American Freight, Big Lots, and 99 Cent Only. 2025 will likely see more with pending closures of Party City, Joann, Advance Auto Parts, and others.

“Although there are many large retail spaces that remain vacant, what has become evident is that ownerships that are right-priced, have the ability to contribute to tenant improvements and are highly-responsive to offers, are often those that secure the tenants in the market,” said CBRE’s Nancy McClure, First Vice President in Tucson. “Some retail boxes likely will be demolished to make way for new concepts or a reimagined overall development with mixed uses.”

Retail continues to be dynamic and ever evolving. Consumers have proven themselves to be multi-channel shoppers with bricks and mortar playing an important role, alongside online consumption. With very little construction of new box spaces, Metropolitan Tucson had 343,594 sq. ft. of box space of 10,000 sq. ft. or larger absorbed in 2024.