by Elaine Misonzhnik October 27th, 2011
While the current trend in the retail industry is for big-box store operators to go smaller, niche grocery operator Trader Joe’s is pursuing the opposite strategy.
An article in the Los Angeles Times notes the chain is on a major expansion drive and in addition to opening new locations, will likely go from its current 10,000 sq. ft. to 15,000 sq. ft. model to building stores bigger than 15,000 sq. ft. to drive sales productivity.
The issue is that Trader Joe’s built its reputation partly on being really good at utilizing smaller spaces. Plus, some of its long-time customers are unhappy about the chain losing some of its small-store charm, Los Angeles Times reports:
“I’ve driven by, and the new building looks kind of shiny and huge, which doesn’t square with what Trader Joe’s is in my head,” said Geragos, a 42-year-old stay-at-home mom. “I’m bummed about losing the homey feel.”
Trader Joe’s operates at least two stores below 23rd Street in Manhattan, where Retail Traffic is based, including a traditionally small store near Union Square and a 41,000-sq. ft. megastore inside a former Barnes & Noble space in Chelsea. While this editor has never been able to withstand the super-long lines and crowded conditions at the Union Square location, the bigger store has proven much easier to navigate.
But we’d be curious to know how retail real estate insiders feel about expanded Trader Joe’s.
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by Elaine Misonzhnik October 26th, 2011
Regional mall operator Taubman Co. is getting ready to start work on at least one new mall, according to the Detroit Free Press.
During a third quarter earnings call with analysts, company officials said Taubman entered the predevelopment stage on a project in San Juan, Puerto Rico and was also forging ahead on malls in Hawaii and Salt Lake City, Utah. (The Salt Lake City project has been announced for some time).
This jibes with what Taubman chief operating officer William S. Taubman told Retail Traffic back in May, when he said there might be room in U.S. for up to 20 new malls.
“There is growth in this country, we will be adding millions of people over the next 40 years and they are going to need somewhere to shop.”
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by Elaine Misonzhnik October 19th, 2011
Given the market’s current preference for discount retailers and luxury stores, it’s good to hear about a mid-market department store chain expanding. Lord & Taylor will reportedly open at least three new stores in the coming months.
The New York Post writes that:
The privately owned retailer, which also operates three lower-price outlet stores, is in preliminary talks with landlords to open still more locations during the next several years in additional states, including California, according to sources close to the company.
This is particularly good news given that only five years ago, the retail industry seemed ready to write Lord & Taylor off as a living ghost. Yet after undergoing a makeover, the chain seems to have found new vitality.
This fits in with the overall trend of department stores coming back into favor, along with regional malls.
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by Elaine Misonzhnik October 10th, 2011
Japanese apparel retailer Uniqlo has some ambitious growth plans going forward. Recently, the chain’s owner, Fast Retailing Co., announced it plans to open anywhere from 200 to 300 Uniqlo stores worldwide over the next nine years.
A story on ApparelNews.net notes:
The goal is to raise revenue from $6.5 billion annually to reach $65 billion in sales by the year 2020—numbers that would, in fact, outpace its rivals Gap and Spain’s Inditex, which owns Zara.
Uniqlo made its debut in the U.S. in the mid 2000s, opening a store in New York City’s SoHo and in several New Jersey malls.
Recently, the retailer launched a 5,000-square-foot pop-up store on 42nd Street near Bryant Park, and in a week’s time, it will open a 64,000-square-foot store on 34th Street and an 89,000-square-foot store on Fifth Avenue and 53rd Street.
Related Topics: International, Management & Leasing, News, Retail, Retail Real Estate, Trends |
by Elaine Misonzhnik October 6th, 2011
In spite of serious market-wide worries about another economic downturn, U.S. retailers posted very strong gains in September.
Thomson Reuters estimates that retail sales rose 5.1 percent during the month, more than its roughly 4.5 percent figure for August. The strong results raised hopes for the upcoming holiday shopping season.
I’m not saying it’s going to be going to an exceptional or a blow-away holiday, but I wonder if people are being overly pessimistic,” Madison Riley, managing director for retail consulting firm Kurt Salmon, said after reviewing retailers’ September reports.
According to ICSC estimates, September same-store sales numbers were the strongest since June, at 5.5 percent. ICSC reported that warehouse clubs as a group posted growth of 12 percent, followed by luxury stores at 10.4 percent. Sales at apparel stores grew the least, at 2.3 percent.
ICSC tracked 26 retail chains in its research.
Kantar Retail, which tracks 25 retail chains, most of them apparel retailers, reported September same-store sales growth of 5.7 percent.
“The resiliency of shoppers in September, especially at apparel and department stores, partly reflects unavoidable back-to-school purchases amid higher apparel prices. At the same time, sales are holding up as shoppers’ spending intentions fall off much less dramatically than the steep falloff in consumer confidence.” said Doug Hermanson, Kantar Retail Economist.
The blog Retail Sails credited back-to-school promotions and discounts on fall apparel items for a 5.7 percent rise in same-store sales. Retail Sails tracks 24 retailers.
Of course none of the above figures include same-store sales reports from Wal-Mart Stores Inc., which accounts for roughly 6 percent of all U.S. retail sales. Wal-Mart stopped reporting monthly same-store sales results last year.
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New Leasing Strategy?
by Elaine Misonzhnik October 12th, 2011
Talk about a mix of high and low! International House of Pancakes (IHOP), a decidedly unglamorous restaurant chain, will reportedly move into the upscale Limelight Marketplace retail venue in the Chelsea section of Manhattan.
Set in a former church building, the Limelight features primarily hip, upscale tenants like make-up seller Face Stockholm, clothing boutique Cult of Individuality and famed Grimaldis pizzeria. The vibe at the property definitely doesn’t lead one to wonder, “Where’s the local IHOP?”
Is this unusual combination the latest thing in retail leasing, a way for owners of upscale centers to cater to consumers’ ongoing focus on value? Does anyone want to share thoughts on what the owners of the place might be trying to achieve?
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