Archive for July, 2008
by David Bodamer July 7th, 2008
Vacancies at U.S. neighborhood and community shopping centers rose in the second quarter to a 13- year high, while vacancies at larger, regional malls were at their highest level since 2002, research firm Reis Inc. said.
The average vacancy rate at neighborhood and community malls rose to 8.2 percent, up from 7.3 percent a year earlier and the highest level since 1995, the New York-based real-estate researcher said. At regional and super-regional malls, vacancies increased to 6.3 percent, up from 5.6 percent a year earlier and the highest since the first quarter of 2002, Reis said.
Retail sales and demand for shopping-center space are being hurt by rising unemployment, increasing food and gasoline costs, and declining home values. U.S. employers cut jobs in June for a sixth straight month, and the jobless rate remained at 5.5 percent after jumping in May by the most in two decades, the Labor Department said last week.
The amount of retail space being abandoned, “consistent with store closures, is at its highest level in almost 28 years,” or as long as Reis has been collecting data, Sam Chandan, the firm’s chief economist, said in an e-mail message.
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Related Topics: News, Retail Real Estate, Trends |
by David Bodamer July 3rd, 2008
Circuit City spokesman Bill Cimino says the company has adequate liquidity to survive several quarters, if not years. “To my knowledge, a Chapter 11 filing is not part of the strategic alternatives that we are looking at,” he says.
The company says it is making progress toward returning to profitability in the second half of the year, through better sales of accessories and warranties and customer service improvements such as training sales reps to greet customers, ask the right questions, and make recommendations.
Some analysts and investors are doubtful, however. “Sure, the company has cash, but the question is can they return to profitability in this environment? The market is saying no,” says Andy Hargreaves, an analyst at investment bank Pacific Crest Securities in Portland, Ore.
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Related Topics: News, Retail |
by David Bodamer July 2nd, 2008
But in 2005, when Trademark began planning a large mixed-use center, Watters Creek, for a 52-acre site in Allen, Tex., near Dallas, it decided to consult a group it had never called on before: women.
Terry Montesi, the company’s chief executive, first hired two female retail consultants: Claudia A. Sagan and J’Amy Owens. But Trademark also invited two dozen women from the Allen area to pick apart its plans for the center. They included Kirsten Fair, a stay-at-home mother of two, and Debbie Stout, a City Council member, who runs a company that sells business forms.
The women weighed in on dozens of features, like the center’s layout, landscaping, parking options, pedestrian walkways and outdoor art. The developers “asked us about every detail, and then they listened,” Ms. Stout said recently.
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Related Topics: Development, Management & Leasing, News, Quirky, Retail Real Estate |
by David Bodamer July 1st, 2008
Blockbuster Inc. said Tuesday it is withdrawing its proposal to buy Circuit City Stores Inc., the big-box retailer whose sales have tumbled this year.
Chief Executive James Keyes said in a written statement that the proposed deal, at a price of $1 billion or more, didn’t make sense because of market conditions.
Blockbuster, the nation’s largest movie-rental chain, will still try to merge content such as movies and games with the sale of electronic devices under one roof — but it will be at Blockbuster’s own stores, Keyes said.
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Related Topics: News, Retail |
by David Bodamer July 1st, 2008
Whoa. This is surprising. There had been talk of Starbucks slowing its expansion plans. But there was little indication that it was going to start making cuts of this magnitude. Previously, the company said it might shut 100 stores. Add 500 to that total. The coffee giant is shutting 600 stores and cutting 12,000 jobs.
Starbucks Corp (SBUX.O: Quote, Profile, Research) said on Tuesday it plans to close 600 underperforming U.S. stores and cut up to 12,000 full- and part-time positions, as it copes with an economic downturn and increasing competition.
The coffee seller, bracing for its first full-year profit decline since 2000, has been grappling with the slowing U.S. economy and consumer spending at the same time that major competitors like McDonald’s Corp (MCD.N: Quote, Profile, Research) have begun attacking its core business.
Starbucks plans to close the company-operated stores by the end of March 2009. The related job cuts would reduce the company’s U.S. workforce by about 8 percent.
The news lifted shares nearly 5 percent.
In a conference call with analysts, Chief Executive Peter Bocian said the move should improve company’s domestic profitability and help it meet previously issued forecasts calling for accelerating earnings for fiscal 2009 through 2011.
Related Topics: News, Retail, Trends |
by David Bodamer July 1st, 2008
Feldman Mall Properties, the struggling real estate investment trust that has lost millions of dollars in the last year and faced questions about its management strategy, said yesterday its stock has been delisted by the New York Stock Exchange.
In more fallout from the national mortgage and financial crises, Great Neck-based Feldman Mall, which owns seven shopping centers across the country – the closest to Long Island is in Colonie, near Albany – has been delisted after falling below minimum NYSE standards, the company said.
Feldman Mall said the delisting will take effect before the opening of the NYSE market on Monday, and on that day its shares will begin trading on the Over-the-Counter Market.
The company went public in December 2004, with its stock selling for $13 a share. Shares yesterday were down 6 cents, closing at $1.09. The stock is off more than 67 percent this year. Shares never went any higher than $13.
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Related Topics: News, REITs, Retail Real Estate |
by David Bodamer July 1st, 2008
Centro Properties Group, which last month won its fifth extension on a deadline to repay as much as A$6.6 billion ($6.3 billion) of debt, is seeking to sell five of its Australian shopping malls to help pay down its obligations.
All of the assets of the unlisted Centro MCS 9 syndicate are up for sale, Melbourne-based Centro said in a letter sent to investors and e-mailed today to Bloomberg. The unit’s malls were worth A$309 million as of Dec. 31, according to Centro’s Web site.
It is an “optimum time” to sell the assets, Centro said. “Certain shopping centers recently offered for sale are achieving strong sale prices irrespective of tight credit conditions and rising interest costs.”
Centro Properties, which owns and manages more than A$24 billion of shopping malls in the U.S., Australia and New Zealand, has plunged 96 percent since Dec. 17 when the company said it was struggling to refinance debt as the seizure in global credit markets shut funding avenues. Centro fell 2 percent to 24 Australian cents as of 3:52 p.m. Sydney time on the Australian stock exchange, valuing the company at A$203 million.
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Previous Centro posts:
- May 29, 2008, Report: Centro Close to Big Sale
- May 14, 2008, Centro’s Shield
- May 9, 2008, Centro Reaches Debt Agreement, Shares Surge
- April 3, 2008, Centro Takeover Rumors Cause Share Surge
- April 1, 2008, Centro Clears a Hurdle
- Feb. 29, 2008, Report: Blackstone, GE, Mulpha, Mirvac Bidding for Centro.
- Feb. 28, 2008, Centro Shares Surge
- Feb. 15, 2008, Centro Wins Extension
- Jan. 15, 2008, Scott Out, Rufrano In at Centro
- Jan. 10, 2008, Daily Centro Update
- Jan. 9, 2008, UBS Cuts Stake in Centro
- Jan. 3, 2008, Centro: Morgan Stanley, Westfield Have Approached Firm
- Jan. 2, 2008, Centro Says Its Getting Offers
- Dec. 18, 2007, Another Round of Centro Coverage
- Dec. 17, 2007, Centro Hit by Credit Crunch
- May, 10, 2007, Centro’s Structure
- Feb. 28, 2007, Centro To Buy New Plan
Related Topics: Finance, International, News, REITs, Retail Real Estate |
by David Bodamer July 1st, 2008
Retailer Steve & Barry’s LLC is readying plans to close more than 100 of its stores, and is contemplating a full liquidation should it not find emergency financing, the Wall Street Journal reported on its website on Monday.
The article, citing people familiar with the company, said the retail chain is seeking a tentative plan for about $40 million in debtor-in-possession financing if it must file for bankruptcy protection. Steve & Barry could not immediately be reached for comment.
The report said that last weekend, Steve & Barry’s bankruptcy counsel, Weil Gotshal & Manges LLP, prepared for a potential bankruptcy filing as soon as this week.
The article said bankruptcy attorney Harvey Miller is handling the case. Miller could not immediately be reached for comment.
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Related Topics: News, Retail, Trends |
