Archive for April, 2009
by David Bodamer April 3rd, 2009
A project that has been the subject of some political problems is facing further pressure from Boston Mayor Thomas Menino.
Five months after developers halted construction at the Filene’s site in Downtown Crossing and left two historic buildings torn apart and a gaping hole in the city’s center, Boston Mayor Thomas M. Menino directed the builders to secure the remaining structures.
Menino sent a letter yesterday to the developers, New York-based Gale International and Vornado Realty Trust, expressing concern about the condition of the buildings’ shells, which have been exposed to the elements for nearly a year, and told them to begin securing them by May 1.
“The current condition of the buildings requires attention to avoid deterioration of the structures and escalated rehabilitation costs,” he wrote.
Related Topics: Development, Mixed-Use, News, Retail |
by David Bodamer April 3rd, 2009
Shopping-center owner Kimco Realty Corp. became the latest real-estate investment trust to attempt to sell a large allotment of stock to address its debt concerns.
Kimco, which owns stakes in 1,950 shopping centers globally, said it will sell 70 million shares of its stock and use the proceeds to pay debt. The offering amounts to a 25% expansion of Kimco’s base of shares outstanding.
The announcement came after the close of regular trading Thursday. Kimco stock had risen 71 cents, or more than 10%, to $7.49, in 4 p.m. composite trading on the New York Stock Exchange. If the new shares are sold at a discount, as is common in such offerings, the sale will bring Kimco roughly $500 million.
Link.
In other financing news, a mall partly owned by Simon Property Group has gone into default.
The Mall at the Source in Westbury, New York, defaulted on the payment of the principal on March 11, said a spokesman for Simon, the largest U.S. mall owner and operator.
Simon holds a 25 percent stake in the mall, and would not disclose its partners.
“Right now there’s a shortage of refinancing dollars in the market place and yes, they’re not going to be alone,” said Thomas Fink, senior vice president of Trepp, which tracks the commercial real estate loans. The loan for the Mall at the Source had been securitized as bonds in a commercial mortgage-backed securities (CMBS) trust.
Related Topics: Finance, News, REITs, Retail Real Estate, Trends |
by David Bodamer April 3rd, 2009
CoStar explores a building trend–the growing volume of vacant auto dealerships is creating a potential supply of developable land.
It appears that vacant auto dealerships may soon join obsolete enclosed malls and the growing inventory of empty big-box stores on the list of former robust retail properties in need of an alternative use.
Already at overcapacity, automakers have been trying to reduce the number of dealerships for years with mixed success. The recession will likely do what the automakers could not — bring the number of dealerships in line with demand. President Obama’s call for more extreme turnaround measures for both General Motors and Chrysler is only expected to add to the number of un-needed dealerships.
Related Topics: Development, Investment, News, Retail Real Estate |
by David Bodamer April 3rd, 2009
Toys “R” Us has been losing to Wal-Mart for years. The discounter is the largest seller of toys in the U.S. Toys “R” Us has added “value” sections at the front of its stores selling very inexpensive toys. looks to be partly a response to that as well as a way to drum up sales in a tough environment where people are watching every penny they spend.
Toys “R” Us has rolled out shops in the front section of its U.S. stores, highlighting toys for $3 and under as it responds to the recession that has made even indulgent parents cut back on toys for their kids.
The privately-held specialty toy retailer, which operates almost 850 Toys “R” Us and Babies “R” Us stores in the United States, said its “$1-$2-$3 Fun” shops will carry about 100 items at those prices.
The effort to woo shoppers comes after U.S. toy retail sales fell 3 percent to $21.64 billion in 2008 from a year earlier, according to market research firm NPD Group.
Related Topics: News, Retail |
by David Bodamer April 1st, 2009
Buffalo Wild Wings Inc., a sports-themed bar chain based in Minneapolis, is one of the companies emphasizing conversions as it expands. Over the past two years, it has acquired eight Don Pablo’s restaurants and turned them into new versions of its sports-themed bar chain. As of the end of the year, Buffalo Wild Wings had 560 sites.
It has also put in place a rebranding “SWAT Team” of construction, operations and other professionals who can take a vacated site and convert it in just a little more than five months.
Giving Buffalo Wild Wings a boost in pursuing the locations is the chain’s balance sheet. “We don’t have any debt and we have cash on the book so these are the kinds of opportunities that we can take advantage of” and the competition often can’t, says Matt Brokl, a vice president and associate general counsel.
Link.
Related Topics: Management & Leasing, News, Retail |
by David Bodamer April 1st, 2009
New research from UBS Securities LLC predicts a 10 percent contraction in space devoted to specialty stores over the next several years, just as weaker malls face either extinction or an accelerated evolution.
“While some specialty retailers could pick up market share as others shutter stores, we expect the majority of the sales to never resurface given the poor quality of those lost sales and given a smaller consumer appetite,” wrote UBS equity analysts Roxanne Meyer, Brian Nagel and Neil Currie in a research report.
The UBS team predicted the reduction in specialty store square footage would be driven by the elimination of newer concepts, such as Abercrombie & Fitch Co.’s Ruehl and American Eagle Outfitters Inc.’s Martin + Osa; the shuttering of underperforming doors; cutbacks in average store size, and the closure of shopping centers. Executives at Abercrombie & Fitch and American Eagle continue to stand behind their respective Ruehl and Martin + Osa nameplates.
UBS worked up a list of the “bottom 300” shopping centers with more than 500,000 square feet and found the companies with the greatest exposure to those centers were Christopher & Banks Corp., 24 percent of its store base; Aéropostale Inc, 16 percent; Pacific Sunwear of California Inc., 15 percent, and American Eagle Outfitters, 15 percent.
Link.
Related Topics: Management & Leasing, News, Retail, Retail Real Estate, Trends |
George Soros Slags Commercial Real Estate
by David Bodamer April 3rd, 2009
What does George Soros know about commercial real estate?
I haven’t ever heard of him doing much in this sector. But given that he’s invested in pretty much everything, he must have some money in commercial real estate. Anyway, Soros thinks commercial property values in the U.S. will drop at least 30 percent.
No Comments Related Topics: Commentary, Investment, News, Retail Real Estate |