Lower Rents, Landlord Concessions and Tenant Improvements Triggering Expansions
By Adam Lyons in : News // Sep 8 2011
Fifty-nine percent of U.S. retailers plan to open more stores due to the attractive rental rates available in the current market environment, according to a survey of 100 chains by real estate services firm CB Richard Ellis.
“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, executive managing director of CBRE Retail Services in the Americas, in a press release.
Ninety-four percent of retailers surveyed said they have been able to negotiate tenant improvements in their leases, including landlord financial contributions toward building out their space, the term of the lease and the rights to terminate early.
In the past year, the consensus outlook among retailers has turned more cautious with regard to the current economic environment, CBRE reports. Only 27 percent of retailers surveyed in 2011 viewed the economy as improving, as compared to 35 percent last year. However, 45 percent of retailers surveyed view the economy as stable compared to 35 percent last year, with 27 percent of retailers feel that the recovery has already occurred within their market segment.
Some of the risks that retailers cited as possibly impacting their businesses included unemployment (80 percent), the state of consumer confidence (79 percent) and higher food and energy prices (68 percent).
Founded in 1957, the International Council of Shopping Centers (ICSC) is the global trade association of the shopping center industry. Its 50,000 members in the U.S., Canada and more than 80 other countries include shopping center owners, developers, managers, marketing specialists, investors, lenders, retailers and other professionals as well as academics and public officials. As the global industry trade association, ICSC links with more than 25 national and regional shopping center councils throughout the world.
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