The Real Deal’s National Retail Market Report is live!
The giraffe mascot of Toys “R” Us, seen on this issue’s cover as a lanky giant laid low, made for a fitting visual for the company it represented — a colossus in its own right that earned the unfortunate distinction of being the third-largest retailer in history to file for bankruptcy. With the announcement in March that the company would close a whopping 800 stores, experts wondered what would fill the void left by its massive footprint. But just as an ecosystem absorbs the fallen and transforms them into food and fertilizer for other forms of life, so does the massive closure present opportunities for others in the retail sphere. Experts weigh in on the many ways retail real estate players may capitalize on the newly vacant spaces.
Happily, not everything about the current market is ripe for a morbid metaphor. Co-working companies, for example, are helping to revive their neighboring retail corridors. And experts heading to RECon in Las Vegas tell us that retailers are enjoying higher credit ratings than they had last year, since the sky has not fallen as many predicted it would. That means tenants are going to drive a harder bargain with their landlords, but deals are still getting done. Nimble owners are subdividing big box store spaces, making room for the kinds of businesses that are so far immune from the reach of e-commerce, as our look at the recent moves of the biggest retail REITs shows. The CEO of retail REIT ShopOne, Mike Carroll, dryly notes: “Amazon still hasn’t come up with a way to duplicate the feeling of getting a manicure or working out in a fitness studio.”
Nonetheless, Amazon is trying to disrupt a contingent of brick-and-mortar retail that was once among the safest bets for landlords: grocery stores. After the company’s blockbuster acquisition of Whole Foods last year, experts told us that competing grocers are desperate to figure out what they can do to “defend themselves” against the heavyweight retailer. Our look into how the company’s real estate team operate found that it’s nearly impossible to guess at — let alone get ahead of — Amazon’s next moves.
Other highlights in this issue include an analysis of the changing mix of mall tenants as seen through the lens of Simon Property Group’s roster this year as compared to last, our look at the top retail leasing brokerages in four of the nation’s biggest markets and a revealing interview with Kimco Realty’s COO, David Jamieson.
Enjoy the issue!
Source: The Real Deal