Retailers plan to open more stores, CB Richard Ellis reports
Rents at malls and on Main Street are low enough that a majority of retailers say they will open more stores, according to a real estate brokerage report.
Fifty-nine percent of U.S. retailers plan to expand into new locations, brokerage CB Richard Ellis reported.
The southwest, from Texas through California, was the part of the country where most retailers said they planned to grow.
“Our survey shows a significant number of retailers will be taking advantage of an opportune time for growth due to compelling rent levels -- luxury goods, wholesale clubs and discounters in particular are expected to continue to expand,” said Anthony Buono, an executive managing director at CB Richard Ellis.
Retailers have improved their financial balance sheets, closed underperforming stores, negotiated lower rents and downsized some stores, the report said. This puts them in a much stronger position than prior to the recession. Local retailers are often still struggling but many national retailers are in a position to increase profitability as the economy and consumer spending rebound.
Expansions are planned even though the economic outlook among retailers has turned more cautious lately. Only 27% of retailers in 2011 viewed the economy as improving as compared to 35% last year. But 45% of retailers view the economy as stable compared to 35% last year, with 27% of retailers feeling that the recovery has already occurred within their market segment.
-- Roger Vincent