Here’s a very cool presentation charting Target’s growth by year. There used to be a similar video about Wal-Mart up, but it seems to be off Dow Jones site now.
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Industry news, views and occasional strange stuff.
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Archive for February 2nd, 2009
January Economic Summary in Graphs
Calculated Risk has an amazing and thorough look at the January economic picture as seen through 20 different measures, including the AIA Billings Index and the vacancy rate at shopping centers.
Chico’s Cuts Jobs, May Close 25 Stores
Clothing company Chico’s FAS said Thursday it is eliminating 180 positions and may close up to 25 stores to cope with the economy’s toll on retailers.
Chico’s, which operates its namesake retail stores, White HouseBlack Market and Soma Intimates brands, has suffered from weak sales as consumers cut their spending back amid the recession.
The job cuts represent roughly 11 percent of its workforce at its Fort Meyers, Fla. headquarters. The move is expected to save the company $15 million over the next year.
“Chico’s FAS has tremendous potential and a bright future, but like the rest of our industry, faces the challenges of one of the toughest economic environments in recent retailing history,” President and Chief Executive David Dyer said in a statement. “Accordingly, it is more critical than ever for us to operate as efficiently as possible.”
Link.
The announcements so far:
Bankruptcies and Liquidations:
- Jan. 7, Goody’s liquidates, closing 287 stores
- Jan. 8, Against All Odds files for bankruptcy protection, operates 64 stores overall, plans to close West Coast stores
- Jan. 13, Shane Co. files for bankruptcy, operates 23 stores
- Jan. 14, Gottschalks files for bankruptcy, operates 58 stores
- Jan. 16, Circuit City to Liquidate, closing 567 stores
Potential Bankruptcies & Liquidation Impact: 999 stores
Announced Closings
- Jan. 8, New York & Co., 50 stores
- Jan. 8, Macy’s, 11 stores
- Jan. 9, Supervalu, 50 stores
- Jan. 13, Cost Plus, 26 stores
- Jan. 20, Yankee Candle, 28 Illuminations stores
- Jan. 21, Filene’s Basement, 11 stores
- Jan. 22, Phillips-Van Heusen, 175 stores
- Jan 22, Brown Shoe, up to 35 Famous Footwear stores
- Jan. 26, Home Depot, 48 stores
- Jan. 29, Starbucks, 200 U.S. Stores (plus 100 international)
- Jan. 29, Chico’s, up to 25 stores
Total Closings: up to 659 U.S. stores
Potential Impact of All Announcements to Date: up to 1,658 U.S. stores
H&M Opening 225 Stores Worldwide in 2009
Swedish clothing store H&M has said it plans to create between 6,000 and 7,000 new jobs in 2009.
The company intends to open 225 new stores around the world in the new financial year.
Fourth-quarter profits at H&M beat analysts’ expectations. It reported a 14% rise in pre-tax profits to 7.11bn Swedish crowns ($891m; £623m).
Link.
Simon Opts to Pay Dividends Mostly as Stock
Simon Property Group Inc, the largest U.S. mall owner and operator, said it would pay out most of its dividend in stock, sending its shares down as much as 8.3 percent.
Simon reported a 6.5 percent increase in funds from operations (FFO), a performance measure for real estate investment trusts (REITs), and said its board voted to pay a quarterly dividend of 90 cents per share in 10 percent cash and 90 percent stock.
The dividend decision will allow Simon to retain $925 million in cash in 2009. The stock later recovered some ground on word the decision would be reviewed quarterly.
“This decision is not made in response to the current retail environment but it means — we’re being conservative with our capital,” Chief Executive David Simon said in a conference call with analysts. “We intend to evaluate this decision each quarter and we’ve also received the right to pay the dividend entirely in cash if conditions warrant.”
Link.
CoStar’s Look at Openings and Closings
CoStar did some great digging–looking through retailer press releases and SEC filings–and compiled a fairly thorough look at retailer opening and closing trends for the past few years. The detailed findings are here.
(Click on picture for larger view.)
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CoStar Advisor compiled the following table from researching the most recent quarterly reports, transcripts and SEC filings of the top retailers in most major U.S. retailing categories, from department and apparel stores, to jewelry and pet stores, and more. Key metrics including the current size of the chain, typical square footage of stores, as well as the number of store openings and closings in 2007 – 2010 are provided. Most figures stated are based on retailers’ fiscal year schedules.
In aggregate, the retailers listed in this chart opened nearly 5,600 stores in 2007, and expect to have opened about 13% less stores in 2008 — nearly 4,850 stores by the end of this fiscal year (which for most ends in January 2009). In stark contrast, the same retailers have so far announced only about 2,000 store openings in 2009.
With nearly 5,100 store closings (up 43% over total store closings in 2007) already identified by these retailers for this fiscal year(and more expected to trickle in as fourth quarter reports surface), there will be an aggregate net loss in retail stores at these retail chains. This is a worrying statistic when we consider that, according to CoStar Property, at least 98.6 million square feet of retail space 15,000 sq. ft. or larger was added to the national retail landscape this year.
According to our calculation, the categories with the largest amount of net store closings (mapped against total store openings) in 2008 are home accessories/furniture, with a net loss of 1,085 stores; electronics with a net loss of 715 stores; and jewelry, with a net loss of 400 stores.
Time to Buy Retail REITs?
(Spotted at REIT Wrecks)
General Growth Gets Another Extension
General Growth has once again worked out an extension with its lenders. It now has until March 15 to deal with its loans. According to a press release from the company issued Friday night:
General Growth Properties, Inc. (NYSE:GGP) announced today that it had entered into Amended and Restated Forbearance and Waiver Agreements with its syndicates of lenders for the 2006 Senior Credit Agreement and the Secured Portfolio Facility which extend the forbearance periods from today until March 15, 2009. Under the terms of the amended Forbearance Agreements, the Company agreed to certain additional restrictions and covenants, and the lenders agreed that certain possible future cross-defaults related to the Company’s mortgage indebtedness will not cause an immediate termination of the Forbearance Agreements.
Past links and stories:
- Jan. 5, 2009, GGP Switches Bankruptcy Advisors
- Dec. 30, 2008, GGP Signs Forebearance Agreement
- Dec. 19, 2008, GGP Puts Centers on the Block
- Dec. 18, 2008, General Growth Extension Comes Through
- Dec. 15, 2008, GGP “Continuing its Discussions with Lenders”
- Dec. 14, 2008, Breaking: GGP Refinances
- Dec. 5, 2008, Citi Plays Hardball With GGP
- Dec. 3, 2008, Centro, GGP Find Ways to Hang On
- Dec. 1, 2008, GGP Gets Two Week Extension
- Nov. 25, 2008, Ackman Builds Stake in GGP
- Nov. 20, 2008, General Growth Hires Bankruptcy Advisor
- Nov. 17, 2008, General Growth Downgraded; Feldman to Stop Filing Public Reports
- Nov. 12, 2008, General Growth Roundup
- Nov. 11, 2008, General Growth Warns of Default
- Nov. 5, 2008, GGP, Kimco Fall After Cutting Forecasts
- Nov. 2, 2008, General Growth “Almost Literally Worth Nothing”
- Oct. 17, 2008, Management Changes at GGP
- Oct. 15, 2008, Margin Calls Hit Two More Retail REITs
- Oct. 7, 2008, General Growth Near Bankruptcy?
- Oct. 3, 2008, General Growth CFO Steps Down; Company Suspends Dividend
- Oct. 2, 2008 GGP Under Fire for Inclusion on Short-Sell Ban List
- Oct. 1, 2008, Could General Growth Be Sold?
- Sept. 23, 2008, Short Selling Banned on General Growth
- Sept. 22, 2008, General Growth Strikes Back
- Sept. 16, 2008, General Growth Offers More Recourse
- Aug. 12, 2008, Another Look at GGP’s Debt
- Aug. 6, 2008, Analysis of GGP’s Debt
- July 25, 2008, Stories With Bigger Implications?
- July 14, 2008, GGP Lines Up New Financing
- April 16, 2008, GGP’s Growing Debt Problem
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Simon: “New Development is Dead for a Decade.”
by David Bodamer February 2nd, 2009
During Simon Property Group’s earnings call, CEO David Simon dropped this bombshell: “The new development business is dead for a decade,” Simon said on today’s call. “Maybe it’s eight years. Maybe it’s not completely dead. Maybe I’m over-dramatizing it for effect.”
Ugh.
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