Year of the Rabbit
I’m not much of a follower of astrology and the signs of the zodiac, but I do know that 2011 is the Year of the Rabbit on the Chinese calendar.
It seems somehow fortuitous that speed and agility define a year that is all about economic recovery. And retail is moving forward at a rate that, while not exactly hare-like, is at least faster than the proverbial tortoise.
A report released in April jointly by the International Council of Shopping Centers and PNC Real Estate Research, entitled “U.S. Retail Real Estate Supply Conditions,” tracked and analyzed announced store closings and GLA for fourth quarter 2010. I realize at first blush that a report about contraction might not illustrate forward progress, but it suggests that retailers were focused on right-sizing in 2010. And a streamlined ship can travel at a much faster clip than a tug boat hauling excess cargo.
According to the report, Blockbuster and Talbots led announced store reductions in the final quarter of 2010, accounting for 41% of total store closings with 182 and 100 units to be shuttered, respectively. A.J. Wright, a division of TJX Cos.,
announced 71 store closings in fourth quarter, Duckwall-ALCO closed 44, regional furnishings player Lack’s closed 36, Borders closed 17 stores, and discount department store chain Loehmann’s announced 15 closings and declared bankruptcy.
During the fourth quarter, some 700 retailers and restaurants announced expected closings, consisting of approximately 10.4 million sq. ft. and representing 0.07% of the total inventory of retail space within the United States.
However, the report emphasized that the improving economy helped to spark stronger profitability in the retail sector as a whole — and that occupancy is beginning to trend higher as more retailers are cautiously returning to expansion.
Chain Store Age’s April/May issue — with the annual real estate section geared toward the ICSC’s RECon 2011 show in Las Vegas held May 22 to 25 — underscores the idea that talk of expansion has supplanted contraction discussions in retailer corporate staff meetings. In our development coverage, beginning on page 34, we highlight the top 12 developments to open in 2010, among them the massive Peninsula Town Center development in Hampton, Va. The developers of Peninsula Town Center — as did all of the shopping center companies interviewed for the story — talked about successful leasing in a recovering economy.
“We opened Peninsula Town Center in the most challenging retail environment in our lifetime, with the two highest-volume department stores in the metroplex, over 70 specialty stores and 13 restaurants and a movie theater,” said Anne Mastin, executive VP leasing for Steiner, codeveloper on the project. “This was an amazing accomplishment in light of the economic climate of 2010.”
There is good reason to be hopeful that next year will show even more progress. For fun, I checked the Chinese calendar: 2012 is the year of the Dragon. I like the sound of that.
Report: Dish Network to assume 500+ Blockbuster leases
New York City — A report Monday by the Wall Street Journal said that Dish Network Corp. will assume leases on more than 500 Blockbuster stores after it completes its acquisition of the video-rental chain.
The lease takeovers will assure that Blockbuster will maintain some physical presence.
In a filing with the U.S. Bankruptcy Court in Manhattan, Blockbuster also listed hundreds of locations where it plans to reject leases, as its number of open stores continues to dwindle.
While there is no concrete information being released yet about how many Blockbuster stores will remain open, the court papers suggest that the latest round of closings will bring the number to around 1,000 open. As of early April, Blockbuster had either closed or initiated closings on nearly half of its stores and now has just over 1,700 locations.
Dish won a bankruptcy court auction this month for Blockbuster with a final bid of $320.6 million. The satellite-TV company hopes to close the deal by April 25, although the purchase agreement gives the company until May 5.
Dish has said it plans to keep some Blockbuster stores open.
Study: 50% of Americans use mobile device to assist with shopping
Chicago — Fifty percent of Americans use a mobile device to navigate their shopping journey, according to a new study released by Arc Worldwide, Leo Burnett’s marketing services arm.
The study — “Marketing to the Mobile Shopper” — found that mobile shopping has become a way of life for Americans. This trend is changing the traditional shopping journey and leaving companies with a serious ultimatum: deliver valuable mobile experiences or risk losing customers.
“Mobile shopping has created multiple paths to purchase,” said William Rosen, president and chief creative officer of Arc Worldwide. “It has completely transformed the way people research and purchase products. Companies looking to crack the ‘mobile code’ must understand shoppers’ unique demands by category and shopper type, which we have carefully explored in this study.”
Click here to view the study.