The Best-Performing U.S. Retail Markets of 2025: Sun Belt Momentum and Charlotte’s Ascent to the Top
by King White, on Jan 19, 2026 7:00:00 AM
The U.S. retail real estate market demonstrated remarkable resilience in 2025, navigating store closures and macroeconomic headwinds with a stabilizing balance of supply and demand. Yet, beneath the surface, market-by-market performance diverged significantly, highlighting key opportunities for retailers, landlords, and investors alike.
According to CoStar’s annual ranking, the top 10 retail markets of 2025 were led by Charlotte, North Carolina, which jumped from sixth to first, bolstered by strong demographic growth, white-collar job expansion, and aggressive backfilling of prime retail space. This marks a continuation of the Sun Belt’s dominance, where business-friendly environments and population inflows continue to power retail fundamentals.
CoStar’s methodology used five equally weighted indicators:
- Percent of Inventory Leased
- Availability Rate
- Asking Rent Growth
- Year-over-Year Change in Sales Volume
- Total Return
These metrics collectively capture market health by measuring occupancy, pricing power, investment performance, and transaction activity.
Top 10 U.S. Retail Markets of 2025
Rank |
Market |
% Inventory Leased |
Availability Rate |
Asking Rent Growth |
YoY Sales Volume Change |
Total Return |
| 1 | Charlotte | 1.4% (27) | 3.4% (2) | 7.4% (1) | 35.8% (10) | 11.6% (1) |
| 2 | Tampa | 2.0% (7) | 3.8% (9) | 4.5% (5) | 6.9% (21) | 7.8% (15) |
| 3 | Orlando | 2.3% (2) | 4.4% (17) | 4.8% (4) | -3.0% (32) | 10.2% (5) |
| 4 | Dallas | 2.1% (6) | 5.1% (29) | 3.4% (10) | 113.6% (1) | 7.5% (17) |
| 5 | Norfolk | 2.4% (1) | 5.2% (31) | 4.5% (6) | 6.6% (23) | 10.4% (4) |
| 6 | Kansas City | 1.6% (18) | 5.0% (27) | 3.8% (8) | 59.4% (6) | 9.6% (7) |
| 7 | Nashville | 1.3% (31) | 3.7% (5) | 5.2% (3) | 0.8% (27) | 11.1% (2) |
| 8 | Miami | 1.7% (16) | 2.8% (7) | 1.2% (26) | 75.7% (3) | 7.6% (16) |
| 9 | Phoenix | 1.9% (9) | 4.9% (26) | 4.4% (7) | 2.0% (25) | 9.0% (10) |
| 10 | Columbus | 1.6% (20) | 3.6% (4) | 2.9% (12) | -14.7% (36) | 10.2% (6) |
(Source: CoStar Analytics, December 2025)
Note: Rankings in parentheses indicate position out of 43 U.S. markets with at least 100M SF of inventory.
Key Takeaways: What’s Driving Market Outperformance?
1. Charlotte: Where Demand Meets Strategic Supply
Charlotte’s growth was driven by a blend of robust white-collar employment gains, suburban greenfield development, and an influx of national tenants. The result: the highest rent growth in the nation at 7.4%, a top 2 availability rate, and the highest total return among all markets.
From a Site Selection Group perspective, Charlotte exemplifies how demographic analytics and demand modeling are essential to identifying viable suburban nodes for retail growth. Our customer analytics platform can pinpoint the fastest-growing neighborhoods, overlaying household income
2. Florida Markets: Resilient Demographics in Tampa and Orlando
Both Tampa and Orlando benefited from steady population inflows and low availability rates—underscoring the appeal of compact, high-barrier-to-entry markets. Orlando’s 4.8% rent growth was offset by a rare dip in sales volume, reflecting capital flow volatility rather than market fundamentals.
SSG’s work in Florida frequently emphasizes the importance of anchored centers and traffic-based site scoring, particularly in areas with seasonal shifts. Using mobile device data and sales forecasting, we help retailers adapt to tourism-driven foot traffic and maximize Q1 and Q4 opportunities.
3. Dallas and Norfolk: Volume and Leasing Strength
Dallas led the nation with a 113.6% increase in sales volume, emphasizing its scale and liquidity as a retail investment hub. Norfolk, Virginia, on the other hand, posted the highest percent of inventory leased and strong rent growth—outperforming expectations for a secondary market.
These trends demonstrate that both market liquidity and occupancy discipline are key metrics to watch. SSG’s tools help clients evaluate long-term absorption trends and saturation levels to avoid overbuilt trade areas.
How Site Selection Group Helps Navigate Market Complexity
At Site Selection Group, we believe success in today’s retail landscape requires more than just knowing the “hot” markets; it requires precision, timing, and alignment between customer behavior and real estate decisions. That’s why we employ a comprehensive suite of tools that inform every step of the site selection process:
- Customer Analytics to identify high-propensity customer segments using demographic, psychographic, and behavioral data
- Drive-Time Analyses to define true trade areas, not just ZIP codes
- Integration of credit card, mobile device, and lifestyle data to inform merchandise mix
- Market Prioritization using composite scoring to rank markets by growth potential, competition, and saturation
- Retail Forecasting to predict occupancy shifts based on national and local trends
By combining national market data with hyperlocal intelligence, we guide clients in capturing untapped demand, avoiding missteps, and building durable retail footprints.
Opportunities in the Southeast and Midwest in 2026
While the Sun Belt continues to dominate the top ranks, 2025’s data highlights potential Midwest surprises, like Columbus, Ohio, which posted a 10.2% total return, and Kansas City, where property sales momentum surged. These markets may offer more favorable cap rates and less competition, ideal for retailers looking to diversify geographic risk.
In 2026, with limited new supply and steady consumer demand, the best opportunities may emerge where retail space is scarce, rent growth remains positive, and customer density aligns with brand targets. The key is knowing where, when, and how to act—and Site Selection Group stands ready to help.
Contact us to learn how our analytics, advisory, and site selection services can give your retail strategy a competitive edge in 2026 and beyond.
