In this tough economic climate, worried consumers have swapped \u201cwants\u201d for \u201cneeds.\u201d As Ross Glickman, chairman & CEO of Urban Retail Properties L.L.C., puts it, \u201cI think people are holding back on their discretionary spending. They\u2019re waiting to see how the market goes.\u201d That will potentially spell some hard times for specialty retailers that thrived during the long economic expansion\u2014those in areas like jewelry, home electronics, clothing and restaurants. Those retailers are rethinking their growth plans for 2008, and retail real estate property owners are following suit. Although many of their plans will reduce the aggregate number of stores and slow growth overall, one nuance tends to be overlooked: Even some of the hardest-hit national retailers are still opening stores. Talbots Inc. plans to close 100 underperforming locations among its 1,149 Talbots-brand stores and 273 J.Jills outlets. At the same time, Talbots has stated that it may also open 35 Talbots Woman stores and 40 Talbots Premium Outlet locations during the next three years. Similarly, The Gap Inc. is closing 100 locations in the United States. Half of those stores will be Gap outlets, while others will include 30 Old Navy and 15 Banana Republic sites. At the same time, The Gap is also planning to add 100 new locations this year.These retailers, and the owners of the sites, are clearly looking beyond the current slower spending on clothing. Even if clothing sales slip this year as expected, plenty of pent-up opportunity remains in key markets from coast to coast. California tops the list of states with the most high-potential clothing markets. According to an analysis by Claritas, a CPN sister company specializing in retail-related demographic and marketing research, households in the San Jose-Sunnyvale market spent an average of $3,253 on purchases in clothing stores in 2007. Other California markets in the Claritas top 10 include Oxnard-Thousand Oaks-Ventura, San Francisco-Oakland and Santa Cruz-Watsonville. A pair of Colorado markets\u2014Edwards and Boulder\u2014also landed in the top 10. Rounding out the strongest clothing-store markets are the Bridgeport-Stamford-Norwalk region in Connecticut, New Jersey\u2019s Trenton-Ewing area, the Boston area and Greater Washington, D.C.Consumer electronics sales, too, are destined for a slide in 2008. The sector\u2019s woes made headlines again last month when Blockbuster Inc. made a surprise hostile takeover bid for troubled Circuit City Stores Inc. Over the last decade, Circuit City has slipped behind Best Buy as the market leader in consumer electronics sales. Whether or not the acquisition succeeds, it will not halt the slide in consumer electronics sales growth. The International Council of Shopping Centers forecasts sales growth in consumer electronics and appliances of only 2 percent this year, down from 3 percent last year and less than one-third of the 6.6 percent growth rate in 2006. Meanwhile, consumer caution is bringing disappointing results to other discretionary categories as well. \u201cPeople are just not shopping in department stores,\u201d said David Jacobstein, a senior retail advisor for Deloitte Touche USA L.L.P. and a former president & COO of Developers Diversified Realty Corp. That trend is pinching national giants like J.C. Penney Co., which reported a 12.3 percent slide in same-store sales across its 1,073-store portfolio in March. In response, J.C. Penney is pursuing its expansion plans at a somewhat slower pace. The company has trimmed planned store openings this year from 50 to 36. Macy\u2019s Inc. is also easing up on the gas pedal. In December, the chain said it would close nine underperforming stores in six states, including Indiana, Louisiana, Ohio, Oklahoma, Texas and Utah. This year, the company will debut five new Macy\u2019s stores, half of last year\u2019s total. And instead of opening two new Bloomingdale\u2019s locations, as it did in 2007, it will renovate several existing stores. The company\u2019s 2009 development pipeline is somewhat more robust, though, as it plans to open at least six new stores. Also in the works is Arizona\u2019s first Bloomingdale\u2019s store, which is scheduled to start construction this fall and open in the fall of 2009 as part of The Related Cos. and Thomas J. Klutznick Co.\u2019s CityNorth project in Phoenix\u2019s Northeast Valley. Eight of the top 10 clothing store markets also rank in Claritas\u2019 top 10 department store markets. Once again, San Jose-Sunnyvale, Calif., took first place in 2007 with average household expenditures of $4,329. Given strong enough demographics, retail owners are still bullish about the long-term prospects for upscale department stores. Last month, Simon Property Group Inc. disclosed plans for a major expansion at Copley Place in Boston\u2019s Back Bay. The plan includes a 54,000-square-foot addition to the Nieman-Marcus store, 60,000 square feet of additional retail and 300 condominium units.Click here for list of charts<\/p>\n","protected":false},"excerpt":{"rendered":"
In this tough economic climate, worried consumers have swapped \u201cwants\u201d for \u201cneeds.\u201d As Ross Glickman, chairman & CEO of Urban Retail Properties L.L.C., puts it, \u201cI think people are holding back on their discretionary spending. They\u2019re waiting to see how the market goes.\u201d That will potentially spell some hard times for specialty retailers that thrived…<\/p>\n","protected":false},"author":1314,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1003801624","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"yoast_head":"\n