June 24, 2022 | Marcus & Millichap<\/p>\n
Restaurants and Grocers Lead Subdued Month in Core Retail Spending<\/em><\/p>\n Retail sector approaches a junction.<\/strong> Improvements in grocery and dining-related spending were brightspots in May, when core retail sales advanced marginally against a backdrop of high inflation. The recent gains recorded across the two retail segments occurred alongside declines in home-based purchasing categories, including furniture, electronics and online spending. This activity points to a broader shift in consumer behavior away from the consumption of home goods and toward necessities and some social experiences. This adjustment has the potential to benefit owners of net-leased restaurants and grocery-anchored shopping centers.<\/p>\n Dining-related spending reaches record mark.<\/strong> Restaurant and bar sales in May accounted for their largest share of monthly core retail sales since the onset of the health crisis at 17.7 percent. Additional spending was driven by a roughly 9 percent increase year- over-year in foot traffic at eateries across the nation. West Coast and Northeast states registered the largest improvements in patronage, suggesting pent-up demand to socialize exists in these regions, following some of the most prolonged health restrictions in the nation. As summer commences, eateries and bars in travel destinations are poised to note further gains in foot traffic. The resumption of more business travel and conventions should also catalyze patronage in metro business districts.<\/p>\n