US' retail sector sees 3.1% holiday sales increase in Q4 2023: Report

The report also indicates a robust end to the year with the highest net absorption levels of 2023 reaching 17.6 million square feet, a surge in demand for mall spaces contributing substantially to the fourth-quarter totals.

The Sun Belt markets are identified as particularly promising for sustained retail rent growth. The top eight markets witnessing the highest population growth from mid-2022 to mid-2023 were all located in the Sun Belt. These markets also reported, on average, 13 per cent less space available compared to the national average, indicating tighter market conditions conducive to growth, as per the report.

Furthermore, 2023 was marked as an active year for retail expansion, with new store opening announcements significantly outnumbering closure announcements. The data reveals about 6,617 new store plans announced in 2023, as opposed to 4,412 announced store closures, showcasing a positive outlook for the sector's growth.

Looking forward to 2024, the report identifies a few key trends expected to influence the retail industry. Firstly, there is a significant push towards adopting generative AI by retailers to enhance consumer shopping experiences and operational efficiency, with an estimated 78 million Americans having used generative AI in 2023.

Secondly, a rethinking of the self-checkout strategy by some retailers is underway, driven by growing customer dissatisfaction, errors, and retail shrinkage associated with self-checkout lanes. Notably, companies like Walmart, Target, ShopRite, Costco, and Dollar General are reassessing this feature or adding additional staff to these areas.

Thirdly, drone deliveries are on the rise, with Walmart planning to expand its drone delivery services in the Dallas-Fort Worth area to cover 75 per cent of the region's population by the end of 2024, potentially serving an additional 1.8 million households. This expansion underscores the evolving dynamics of retail delivery services and the potential for broader adoption in the future.

Fibre2Fashion News Desk (DP)