REAL ESTATE

Sidecar takes Broadway Village space

BY Michael Fickes

Tucson, Ariz. — Sidecar, a craft beer and cocktail bar, will open in June in Tucson, Ariz., at Broadway Village plaza. The 963-sq.-ft. space will seat about 40 people inside and 12 or so people outside on the patio. Commercial Retail Advisors represented the landlord, CRI Broadway Village Partners in the transaction. Sidecar represented itself.

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Whole Foods stays positive after shares slip

BY CSA STAFF

Whole Foods Market said total sales for the first quarter ended Jan. 19 climbed 10% to a record $4.2 billion. But those results reportedly missed analysts’ expectations, and the company has lowered its earnings outlook for 2014 as a result.

Momentum at Whole Foods — as well as shares — slipped. Comparable store sales for the quarter increased 5.4%, compared to a 7.2% increase in the prior year.

The company has revised its outlook for the year, and now expects sales growth of 11% to 12%, comparable store sales growth of 5.5% to 6.2% and diluted earnings per share of $1.58 to $1.65. The company’s prior outlook anticipated sales growth of 11% to 13%, comparable store sales growth of 5.5% to 7% and diluted earnings per share of $1.65 to $1.69.

The company also expects Easter to negatively impact comparable store sales growth in the second quarter and positively impact them in the third by an estimated 50-60 basis points, because the holiday will fall in the third quarter this year versus the second quarter last year.

Sales growth slowdown notwithstanding, the company’s growth initiative remains aggressive. Co-CEO Walter Robb remained positive and reiterated that he sees demand for 1,200 Whole Foods stores in the United States alone.

"With unparalleled quality standards, we are the leading retailer of fresh, healthy, natural and organic foods. We are very confident in our future growth potential and are moving aggressively to take advantage of that opportunity," said Robb. "With a base of 373 stores today and a record 107 stores in our development pipeline, we expect to cross the 500-store mark in 2017."

The company opened 10 stores in the first quarter and has opened two stores so far in the second quarter, expanding into five new markets. It plans to open an additional store in the second quarter and expects to open another 20 to 25 in the second half of the year. The company currently has 373 stores totaling approximately 14.2 million sq. ft.

The company recently signed 21 new leases totaling approximately 920,000 sq. ft., increasing its development pipeline to a record 107 stores. These leases are for new stores in Huntsville, Ala.; Vancouver, Canada; Brea, Calif.; San Diego, Calif.; Winter Park, Fla.; Kennesaw, Ga.; Schererville, Ind.; Lexington, Ky.; Charlotte, N.C.; Wall, N.J.; New York City, N.Y. (Bryant Park); Frisco, Texas; Tacoma, Wash.; and Wauwatosa, Wis. They also include leases acquired for seven Chicago-area locations formerly operated as Dominick’s stores in Edgewater; Elmhurst; Evanston; Lincoln Park; Streeterville; West Loop; and Willowbrook.

Whole Foods’ expansion plans don’t seem limited to more stores in new markets. The company is adding non-organic, conventional produce into its stores to attract a broader range of consumers, according to reports — which should put the company in a position to compete more effectively.

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J.C. Penney names retail finance vet to replace CFO Hannah

BY CSA STAFF

Ed Record, a former finance executive with Stages stores, Kohl’s, Belk and Federated, has been appointed to replace Ken Hannah as CFO at J.C. Penney.

Hannah joined J.C. Penney less than two years ago under the leadership of former CEO Ron Johnson, a former Apple executive who pursued a costly transformation strategy that alienated customers and led to sharp sales declines. Johnson was ousted last April and former J.C. Penney CEO Myron Ullman was brought back to restore growth and undo much of Johnson’s handiwork.

The departure of Hannah, effective March 24, is the latest example of Ullman’s strategy to “recover from Ron,” and means J.C. Penney soon will be under the financial leadership of a finance executive who, unlike Hannah, spent his career in the department store space.

Record, 45, spent the past six years at Stage Stores where he served as COO and CFO. Prior to that, he was SVP of finance at Kohl’s and a controller and SVP of finance at Belk. Earlier in his career he held a variety of finance positions at the former Federated stores.

"Ed (Record) is a highly accomplished executive with a broad understanding of retail finance and operations,” Ullman said. “His extensive department store experience and track record of success make him an ideal candidate as we continue to advance our turnaround.”

Ullman wished Hannah success in his future endeavors and characterized his contributions at J.C. Penney as meaningful.

Hannah came to J.C. Penney in May 2012 with a far more diverse finance background that Record. Prior to J.C. Penney, Hannah had spent six years at MEMC Electronic Materials where he was president of solar energy and CFO. His retail experience came at The Home Depot where he served as an SVP of finance, but prior to that he held finance roles at Boeing, General Electric and McDonnell Douglas.

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