The US Retail Sector On Pace to Absorb 12.4MSF in 2012
May 23, 2012
Globe Street Raines Feldman
LAS VEGAS - In a report that came out at ICSC RECon2012, Cassidy Turley reports that the in the first quarter of 2012, the retail sector absorbed 3.1 million square feet, following a pace of 3.4 million square feet in the previous quarter. The pace over the last six months is five times faster than any point in the recovery cycle. But the sector still has a long way to go to reach full recovery, noted the firm’s chief economist Kevin Thorpe. "We may have a long way to go to reach what’s considered full recovery, but the US retail sector also has made tremendous strides from our depths," Thorpe said. "The US retail sector is on pace to absorb 12.4 million square feet in 2012-equal to about half the pace of 2006 and 2007-and the latest data confirms that the uptrend in retail is clear, consistent and accelerating, all of which is good news."
For more ICSC RECon2012 coverage news, thoughts, happenings, see below:
GlobeSt.com’s retail expert Ian Ritter chatting with CBRE’s Andrew Goldberg, EVP of the firm’s New York tri-state region retail brokerage services group. Goldberg partners with major retailers on a myriad of real estate requirements, from flagship lease negotiations to national retail strategies. Goldberg told Ritter that the New York City retail market is strong and that discount chains are looking for spaces there.
GlobeSt.com ran into Andrew Kirsh, a partner at law firm Raines Feldman LLP, at ICSC RECon12, who tells us that the retail market is in a fascinating state right now. "While at ICSC in Las Vegas, it is clear that all of the developers and shopping center owners are chasing the strong credit tenants like a CVS, Walgreens, or Whole Foods, who have survived the recession and are viewed as companies who won't fall victim to the growing internet consumer presence," he says. "Consequently, these tenants can cut whatever deal they want. Without these credit tenants, retail development deals will continue to be challenging to finance."
GlobeSt.com met up with Caruso Affiliated’s Paul Kurzawa, COO, who explained that the firm is busy this year, not only with projects on the horizon like the Linq in Vegas, and its $52-million 8500 Burton Way mixed-use project (which it expects to be completed by October), but it is also improving its current facilities. Kurzawa told GlobeSt.com that at the Grove, for example, it is remerchanding and building up a new retail line-up for its 10th anniversary. It is also adding a new lounge area, personal shopper, adding stylist, launching green and tech initiatives among other things, to help "create a different experience for a shopping center." Not only that, but he said that the firm is still on the hunt for new opportunities "mainly on the west coast, and mostly in California."
"With limited construction and soft but positive GSP growth, we are seeing positive growth across all our centers," explained David Henry, ICSC chairman and president and CEO of Kimco Realty Corp., during a short lunch presentation here at ICSC RECon 2012. According to Henry, Kimco is well positioned for the next several years." In his speech, Henry, who leaves his ICSC post "confident about the health of the shopping center industry," focused on the strength of ICSC-an organization filled with employees who are passionate about their jobs. He also talked a bit about the "unfairness of non-taxed online retailers." He pointed out that a "level playing field between brick and mortar retailers is important...politics is part of our business." Following his speech, Joan Lunden, co-host of ABC’s Good Morning America, chatted a bit more about the topic of politics with Tom Daschle, former US senator (D-SD) and senate majority leader; Trent Lott, former US senator (R-MS) and senate majority leader. "You have to find common ground regardless of the issues," stressed Daschle, who added that how to spur job growth is a constant debate in Congress.
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