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Report: Q2 vacancy declines across all commercial sectors, including retail

BY Katherine Boccaccio

Boston — A report released Tuesday by CB Richard Ellis found that, despite concerns about the pace of economic recovery and lukewarm employment growth, the U.S. commercial real estate market showed improvement across all property sectors in the second quarter of 2012.

Retail properties, which have generally lagged other property sectors during the recovery, saw a slight improvement in availability, which fell to 13% during the second quarter.

“The commercial real estate recovery remained intact in the second quarter, despite growing worries about the global economy,” said Jon Southard, managing director, CBRE. “With construction well below typical levels in a recovery, any and all improvements in demand get channeled into a lower vacancy rate.”

A majority of the retail markets recorded either flat or declining availability rates compared to Q1 2012. Notable performers included Bakersfield, Calif.; Cincinnati, Columbus and Cleveland, Ohio; Providence, R.I.; and San Diego. Each of these markets recorded a decline of at or above 70 basis points. On the other end of the spectrum, markets such as Jacksonville, Fla.; Nashville; and Richmond, Va. recorded gains in availability rates of at or over 70 basis points in the second quarter. Most markets are still hovering at or above their Q2 2011 availability rates, according to CBRE.

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News

Global report underscores need for seamless shopping across all channels

BY Allison Cerra

Paris — Shoppers worldwide expect a seamless integration across online, social media, mobile and physical stores, according to a new global report released Tuesday by Capgemini.

According to "Digital Shopper Relevancy," which surveyed 16,000 digital shoppers across 16 developing and mature markets, 60% of respondents said they expect the convergence of retail channels by 2014, while more than half of those surveyed said most retailers currently are inconsistent in the way they present themselves across channels.

Key findings from the Capgemini report include:

  • Websites continue to be the main digital shopping channel for shoppers in both developing and mature countries: 80% of respondents in developing markets said the Internet was "important" or "very important," while 63% in mature markets noted that the Internet was "important" or "very important" to the shopping journey. This is closely followed by e-mail interaction. However, such channels as social media, mobile applications and in-store kiosks are growing in popularity as alternative retail channels;
  • The number of digital-savvy shoppers increases considerably in developing markets and they tend to "leapfrog" the traditional retail infrastructure adopted by mature markets: 72% of respondents from India and 69% from China state that they purchase more products in a single transaction online than in a physical store, compared with just 31% from the United States;
  • More than half of the respondents from both developing and mature markets said they expect physical stores for increasing numbers of categories will simply become showrooms to select and order products by 2020;
  • More than half of those surveyed (56%) are likely to spend more money at a physical store if they had used digital channels to research the product prior to purchase; however, 73% of respondents also expect online prices to be lower than those in physical stores;
  • There is no "one" digital shopper profile as varied behavioral patterns appear across a number of factors, including age, gender, product category, journey stage and market maturity. The study did highlight that 55% of women shoppers are more engaged when using digital channels, compared with 44% of men; and
  • "[It] is critical for retailers to identify who is really using these channels and essential in determining where to make digital investments and how to monetize them," Helders said. "The findings of the report are a call to action for retailers and consumer goods companies to adopt a new approach and harness the technology that’s now available."
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STORE SPACES

Office Depot honored as Energy Star Leader for 2012

BY Marianne Wilson

Boca Raton, Fla. — Office Depot announced that it has been named to the Environmental Protection Agency’s (EPA) list of 2012 Energy Star Leaders for Leadership in Reducing Greenhouse Gas Emissions. Office Depot’s significant energy reduction makes the retailer the first ever retailer in the United States to be recognized for a 30% or greater improvement.

In the baseline year of 2004, Office Depot facilities emitted 381,689 metric tons of carbon dioxide. By 2011, the carbon footprint of Office Depot’s facilities was 239,319 metric tons — a reduction of over 140,000 metric tons, or 37% over the seven year period. This is equivalent to the annual greenhouse gas emissions of nearly 28,000 passenger vehicles.

"Office Depot is pleased to be recognized as an ENERGY STAR Leader for the second time,” said Edward Costa, VP construction for Office Depot. "Becoming the first retailer to achieve 30 percent or greater energy reduction further demonstrates our commitment to environmental leadership as we continue to implement a range of initiatives that uphold the company’s global environmental strategy to Buy Greener, Be Greener and Sell Greener.”

The achievement was accomplished as a result of investing in energy efficiency and green building initiatives. Such projects have included a major de-lamping effort and a change to energy efficient lamps, reflectors and ballasts; the installation of motion detectors in receiving areas; continued upgrades to building HVAC systems; and aggressive energy management controls and monitoring.

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