CTO Realty Growth's Strategic Leasing Momentum and Retail Resilience in the Southeast

The Southeast United States has emerged as a powerhouse for retail real estate investment in 2025, driven by a confluence of low vacancy rates, rising consumer spending, and the rapid adoption of experiential commerce. At the forefront of this transformation is CTO Realty Growth, a REIT that has leveraged its focus on experiential retail to secure strong leasing momentum and outperform market benchmarks. As consumer demand shifts toward immersive, community-driven experiences, CTO's strategic positioning in the Southeast offers a compelling case for investors seeking exposure to high-growth retail markets.

CTO's Leasing Momentum: A Blueprint for Resilience

CTO Realty Growth has demonstrated exceptional leasing activity in the Southeast during the third quarter of 2025, leasing 60% of its vacant anchor spaces and achieving a 21.7% base rent spread on comparable leasing year-to-date, according to a Yahoo Finance report. This performance is underscored by the company's ability to attract experiential tenants, such as The Picklr, a 23,775-square-foot indoor pickleball club that recently opened at The Collection at Forsyth, a major Atlanta-area retail center, according to a Stock Titan report. The addition of such tenants has propelled the center to a 91% leased occupancy rate, highlighting the demand for mixed-use spaces that blend fitness, entertainment, and retail, according to the Stock Titan report.

CTO's success is not isolated. The company reported a 2.3% increase in Same Property Net Operating Income (NOI) during the quarter, a metric that reflects its ability to stabilize and grow cash flows in a competitive market, according to the Yahoo Finance report. This resilience is critical in an era where traditional retail formats struggle to adapt to shifting consumer preferences. By prioritizing experiential tenants, CTO has created a flywheel effect: high foot traffic from these tenants drives ancillary retail sales, while the resulting vibrancy enhances property values and tenant retention.

Experiential Retail: The New Engine of Real Estate Demand

The Southeast's retail real estate boom is inextricably tied to the rise of experiential commerce. In Florida, for instance, sit-down restaurants and interactive dining concepts have become linchpins of retail centers, generating foot traffic and fostering a sense of place, according to a Tistory post. Developers are capitalizing on this trend by designing spaces that integrate culinary experiences with retail, such as Chef Art Smith's Homecomin' in Atlanta, which combines a restaurant with a marketplace for local goods. These hybrid models not only attract diverse demographics but also create sticky environments that encourage repeat visits.

The impact extends beyond dining. In Texas, Happy Belly Food Group's Rosie's Burgers has secured its first U.S. real-estate location in Lubbock, leveraging the region's pro-business environment and high-traffic corridors to expand its quick-service brand, according to a Stock Titan report. Meanwhile, platforms like The Investors Pool are democratizing access to Southeast retail real estate by offering fractional ownership in multi-family and mixed-use developments, a trend that introduces liquidity and broadens the investor base, according to a Decrypt report. These innovations signal a maturing market where experiential retail is no longer a niche but a core driver of value.

Investment Fundamentals: A Market in Motion

The Southeast's retail real estate fundamentals are robust, with vacancy rates in major markets like Atlanta, Miami, and Tampa falling below 4% in 2025, according to a Matthews report. Atlanta's retail market, in particular, remains exceptionally tight, with a 3.7% vacancy rate and annual rent growth of 4.0%, according to the Matthews report. This is driven by population and job growth, as well as the influx of major employers like Oracle and Amazon into cities like Nashville, which is reshaping its retail landscape to accommodate new demand, according to the Matthews report.

Consumer behavior further reinforces these trends. According to a 2025 market report, 81% of shoppers now prefer stores that offer interactive experiences, a shift that has accelerated the adoption of omnichannel retail formats, according to a Schuckman Realty report. Retailers like Boot Barn and Dollar General are expanding into suburban and secondary markets, while open-air developments-known for their flexibility and walkability-continue to outperform traditional malls. For investors, this means prioritizing assets in high-growth corridors and tenant mixes that balance experiential and traditional retail.

The CTO Thesis: A Strategic Play on Experiential Commerce

CTO Realty Growth's performance in the Southeast underscores its ability to anticipate and act on market shifts. By securing high-quality experiential tenants and maintaining a disciplined approach to leasing spreads, the company has positioned itself to capitalize on the region's demographic and economic tailwinds. For investors, CTO represents more than a REIT-it is a vehicle for participating in the broader transformation of retail real estate, where experience-driven commerce is redefining value creation.

As the Southeast continues to outpace national averages in rent growth and absorption, the case for CTO becomes increasingly compelling. The company's focus on experiential retail aligns with both consumer demand and developer innovation, making it a strategic asset in a market where the future of retail is being written in real time.