According to CoStar, the Rapid City retail market in Q1 2026 demonstrates a stable but slightly softening performance, with a vacancy rate of 3.2% — up 0.9% year-over-year — driven by minimal new deliveries of just 10,700 SF and significant negative net absorption of -70,300 SF over the past 12 months. This has pushed vacancy above the five- and ten-year averages of 2.6%, though the overall availability rate remains low at 2.0% with approximately 180,000 SF listed as available. No retail space is currently under construction, well below the 10-year average of 9,000 SF, signaling limited new supply. Subtype variations show neighborhood centers maintaining very low vacancy at 0.2%, while strip centers face higher vacancy at 11.7%, and general retail and malls sit at 2.9% and 3.6%, respectively.
Market asking rents stand at approximately $14.77–$14.80/SF, reflecting modest year-over-year growth of 0.5%, lagging the national average of 1.9% and showing variation across subtypes (e.g., +1.5% in neighborhood centers but -0.8% in malls). Leasing activity highlights notable deals, such as Baseline Fitness taking nearly 30,000 SF at the former Shopko location, alongside smaller transactions in areas like Dakota Market Square and downtown properties. Sales volume remains subdued at $4.3 million over the past year with only 46,000 SF traded, below historical averages, and estimated pricing at $117/SF (well under the national $249/SF) with a higher cap rate of 8.8% compared to the national 7.3%, indicating a cautious investment environment.
For more detailed insights, feel free to reach out to Dustin Ferguson for the latest trends. Attached is the latest trends report from CoStar.
Read More at: Multifamily Trends Report
Market data is provided by CoStar Analytics. Ferguson Appraisals, LLC is a licensed user of CoStar Analytics and has received permission to share the published report.