Posted on 12/30/2008 7:54:41 AM PST by Red in Blue PA
The dismal holiday shopping season may sink some retailers and could take down some U.S. malls struggling with rising vacancies, softening rents and their own large debt loads.
"This is probably going to go down as the worst season in history as far as retail sales," said Victor Calanog, director of research for real estate research firm Reis. "The difficulty of ascertaining what the effect would be at the property level is because we're already heading toward a train wreck."
At the end of the October, the International Council of Shopping Centers (ICSC) forecast that national chains would announce 6,100 store closings in 2008 and 3,100 in the first half of 2009.
(Excerpt) Read more at cnbc.com ...
Aside from the illegals, however, it sounds as though you were describing my childhood mall, the Green Acres Mall in Valley Stream, NY. Most of the thuggocracy there are native born, however, and even stomped a poor Haitian immigrant to death on Black Friday.
The trend in more affluent areas is smaller, outdoor "lifestyle centers." Simon is going to be upgrading the local "B" Mall (Quakerbridge) to an "A" by 2010, as they will be adding a Needless Markup.
If only Trader Joes would deliver.
You’re welcome..., posting is cheap fun on Free Republic...
As soon as Webvan opened up in my area, many years ago, I started getting all my groceries delivered. I used their service until the day they closed down, and the very next week started using Safeway.com.
I really never go to the grocery store anymore. I haven’t in years. Just 7-Eleven once in a while if I run out of milk.
I have 4 young children and work 32 hrs/wk and have no time for (and no interest in) hanging around in grocery stores looking at and gathering food. I can order $500 worth of groceries in literally one click (last week’s list, saved), in one second. And then it comes to my door and is taken right into my kitchen.
Betcha they won’t deliver to far southwestern NY!
WE are about 8 hours away from the NYC area, if you drive the speed limit.
LOL. I post in hopes that liberals will see the truth.
Pipe dream, I know.
I agree with you, I’m seeing a huge trend in the outdoor mall thing. There is a really nice one up San Antonio way, where the big water park is, as for the one out on 290, I haven’t been there.
I am such an online shopper kinda a girl.
Merry belated Christmas Whyisa! :-)
Exactly right, re. mall design. It’s a trending change. Plus one thing overlooked around here and on news reports:
Retail inventories are low due to low projections earlier in the season. Expect to see strong numbers v. projections, and higher profits v. projections, due to strong inventory movement.
I think we are seeing the end of Retail Christmas. People are starting to ratchet back the craziness already; it won’t be long before the gift madness stops as well.
Christmas will become more like Thanksgiving. Basically, a one-day event with a meal, church, and the exchange of a few small gifts. And possibly football.
These must be the same freepers who made sure to go on the housing bubble threads and declare that there was no housing bubble (because a home sold on their street last week).
Your post reminds me of an excellent interview I saw on one of the business channels. The guest was explaining that one thing that is different about this downturn is that downturns traditional start with a bubble that pops.
This downturn started with MANY bubbles, not all of which have popped yet, but which will.
Yeah, there’s always someone.... on just about every subject...
This weekend I wandered over to Wally World because I was interested in how much interest was being shown in the much ballyhooed iPhone offer.
Answer: None.
There were two guys in ponytails standing around behind the counter bored. I asked them how many iPhones they had sold at the “great deal” of $197 (plus contract etc.).
Answer: None.
Why?
What I’m saying is: yes, you are stating the common wisdom and traditional approach on this, but is it really true today?
If consumer spending did not contract as it did these last months, the economy would be doing fine. It’s not the “credit freeze” that is responsible for most of the contraction. It’s the fact that people with money to spend on discretionary income are the very ones who just lost 30-40% of their 401(k)’s and another 30-40% on their expensive homes.
They can spend, but they aren’t going to.
It doesn’t have anything to do with manufacturing the stuff they used to buy and would have bought had they not been crashed by the housing bubble.
Most residential and commercial real estate borrowers cannot get refinancing at the moment, no matter what.
But it’s not because there is no money to lend or because credit is tight.
It’s because lenders have returned to traditional underwriting standards, such as 80% LTV ratio, AND PROPERTY VALUES ARE OFF MORE THAN 40%.
IOW, since the property is now substantially less than the original loan, the borrowers simply cannot meet the LTV criteria.
If lenders don’t modify loans, many if not most of those loans will default.
Apparently, not all that many. Aren’t Bed Bath and Beyond going into bankruptcy?
Oh, wait. That was Linens n Things.
BBB will be next. They stuff they sell only works when people are feeling affluent. When hard times hit, people figure they can make do with the towels and kitchen gadgets and other doodads they already have.
I agree.
>>I agree - I think a lot of this crap is manufactured by the press. Shopping was hella crazy here in St. Louis. Amazon posted yesterday it had it’s best Christmas season ever...I’m not seeing all this doom and gloom.<<
You need to look harder. There are lots of people at the malls all right, but ask anyone working a store and they will tell you people either are not buying at all or they are not buying as much as they once did.
Amazon may be doing fine. I understand Wal-mart is soo. During the GD some companies flourished. It was still considered a pretty bad time all around, though on the up-side, a lot of new squirrel recipies were born.
As I’ve said, this isn’t about not having the money or about the credit.
It’s about people with money and credit deciding they don’t care how cheap things are, they are chopping their discretionary spending way down.
No amount of jobs “working on the railroad” jobs are going to “stimulate” these upper-middle class earners, who already have just about everything they actually want anyway, to start back to the spending spree. They are the very ones who have been crushed by the stock market and the housing bubble.
Without consumer spending, our economy doesn’t work. Period.
Malls were already dying. This will finish them off. Retail Christmas was already dying. This will finish it off.
Everybody spent and will spent less. Then everybody will get used to spending less and that will become the new norm for half a century or so.
It’s the end of Retail Christmas. The business model of doing nothing all year and depending on Christmas for the year’s profitability will go by the wayside.
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