As we head into 2026, the story isn’t about collapse or boom — it’s about selectivity.

Consumers are still spending. Retailers are still operating. Capital is still moving.
But the margin for error is thinner, and the difference between performing assets and surviving ones is becoming clearer.

Here’s what stood out this week.

The labor market is still holding together, but the tone has shifted.

Unemployment remains relatively low at 4.4%, yet hiring slowed significantly in 2025. December payroll growth came in at just 50,000 jobs, with most hiring concentrated in restaurants, healthcare, and social services.

One underappreciated data point: involuntary part-time employment jumped 21% last year. More than 5 million workers want full-time jobs but can’t find them. That tells us the labor market is loosening beneath the surface, even if layoffs remain modest.

Wages are finally growing faster than inflation — about 3.8% year over year — which provides some relief. And while 2025 saw over 1.2 million layoff announcements, the pace has slowed recently, offering workers slightly more near-term security.

At the same time, business activity picked up in the services sector late in the year. According to ISM data, services growth accelerated at the fastest pace in over a year, driven by new orders and the first increase in hiring since spring. Manufacturing, however, continues to lag under tariff pressure and weaker demand.

Takeaway: The economy is still standing on solid footing, but momentum is uneven. Services — where retail lives — are doing the heavy lifting.

Retailers heading into 2026 are far more disciplined than they were just a few years ago.

Recent retail outlooks point to a clear shift: profitability and efficiency matter more than footprint growth. Store openings are slowing, prototypes are tightening, and locations are being evaluated more rigorously on trade area quality, traffic, and occupancy costs.

At the same time, international retailers are increasingly viewing the U.S. as a growth opportunity. These brands aren’t expanding everywhere — they’re targeting strong suburban corridors and well-positioned strip centers where demographics, visibility, and daily traffic already exist.

Capital is also concentrating. Billions are flowing into mixed-use and institutional projects, where density and experience drive long-term relevance. That doesn’t mean neighborhood retail is losing importance — it means everyday retail has to be clean, functional, and well-located to compete.

Takeaway: Retail isn’t shrinking indiscriminately. It’s reallocating toward locations that truly work.

This theme shows up clearly in my day-to-day work.

We recently closed a 14,000-square-foot multi-tenant strip center in San Antonio, owned and operated by the same family since 1986. The sale was part of an estate-planning decision. By pricing and positioning the property correctly, we generated multiple offers, qualified the right buyer, and closed quickly — allowing the seller to move forward confidently.

On the leasing side, demand is still very real. My team and I are looking for:

The common thread: retailers are expanding — but only where the fundamentals make sense.

Here’s the belief I see holding many owners back:

Stability equals value.

If a center is leased, cash flow is steady, and nothing feels urgent, it’s easy to assume the property is doing well.

But stability doesn’t automatically mean performance.

What separates outcomes over time is active management.

Static ownership often looks fine on the surface — rents stay flat, expenses creep up, and decisions get deferred. Proactive ownership measures rents against the market, evaluates tenant mix intentionally, and uses lease structure to protect cash flow before pressure appears.

One property stays “fine.”
The other compounds value.

The shift isn’t about fear — it’s about curiosity.

Curiosity about where your property sits in today’s cycle, and whether small, intentional moves now can protect and grow value over the next five to ten years.

Retail real estate in 2026 isn’t about guessing what’s next.
It’s about understanding what’s changing — and staying engaged enough to respond thoughtfully.

If you want help thinking through your property, tenant mix, or longer-term strategy, you’re more than welcome to reach out. I’d be ecstatic to bring you something of value.

— Ray

Markets don’t wait — and year-end waits even less.

In the final stretch, money rotates, funds window-dress, tax-loss selling meets bottom-fishing, and “Santa Rally” chatter turns into real tape. Most people notice after the move.

Elite Trade Club is your morning shortcut: a curated selection of the setups that still matter this year — the headlines that move stocks, catalysts on deck, and where smart money is positioning before New Year’s. One read. Five minutes. Actionable clarity.

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If you want a clearer understanding of where your strip center stands today — or what opportunities you might be missing — feel free to reach out.

I’d be more than happy to walk through it with you.

Thanks for reading. You’re always welcome to reach out with any questions or anything you need to better understand your investment. I’m here to help you make well-informed decisions with confidence.

— Ray Kang CCIM

Strip Center Investment Sales & Advisory

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