Tuesday, August 31, 2010

Saks Shares Surge on Buyout Talk

Shares of Saks rose sharply early Tuesday after a report that said the company may receive a buyout offer of $1.7 billion.

The Daily Mail of Britain said that American and British buyout firms were nearing a bid of $11-a-share for Saks, a 75 percent premium from the stock’s close on Monday. In trading before the market opened, shares of Saks rose as high as $9.

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Wagamama Plans Major Expansion in the Boston Area

A small global chain of Japanese noodle houses is looking to continue its expansion into the Boston area, with a number of locations possibly opening up over the next few years.

According to The Financial Times, Wagamama is planning to open ten more restaurants in and around Boston by the end of 2013, having the dining spots join the three that are already open in Faneuil Hall in downtown Boston, the Prudential Center in the Back Bay, and Harvard Square in Cambridge. . . . more

Monday, August 30, 2010

Tension builds over Filene’s site project

The developers of the stalled Filene’s redevelopment are refusing to acknowledge the city’s Sept. 26 deadline for resuming work on the massive construction crater they left in Downtown Crossing, intensifying a very public fight with Mayor Thomas M. Menino.

Developers John B. Hynes III and Vornado Realty Trust sent a letter to the Boston Redevelopment Authority disputing the city’s claim that their approvals will lapse on that date, arguing they have the authority to proceed and that stripping their permits will cause further delay. . . . more

Dunkin’ adds 338 stores in 1st half of year

Dunkin’ Donuts quickened the pace of new store openings this year, with 338 net new locations unveiled worldwide during the first six months, compared with just 175 new shops during the same period last year.

The Canton coffee and doughnut company, which has which has a total of 9,524 shops, is also making a big push internationally. . . . more

Jo-Ann Stores stock climbs after 2Q results

Shares of arts-and-crafts emporium Jo-Ann Stores Inc. soared Thursday, a day after the store raised its outlook and reported a return to second-quarter profit.

Jo-Ann currently owns over 750 stores across 48 states and plans to grow more, adding at least 50 new stores and remodeling at least 50 more in the 2012 fiscal year. The company is benefiting from increased interest in sewing around the country, brought on in part by the recession.. . . more

Blockbuster to file Chapter 11 in September

Blockbuster is preparing to file for bankruptcy next month, The Los Angeles Times reported on Thursday.

The chain is hoping to use its time in Chapter 11 to restructure a crippling debt load of nearly $1 billion and escape leases on 500 or more of its 3,425 U.S. stores, the report said.. . . more

Borders to Sell Build-A-Bear Items as Readers Switch to E-Books

Borders Group Inc., the second- largest U.S. bookstore chain, will start selling items from Build-A-Bear Workshop Inc., relying less on books for sales as more people use electronic reading devices.

Most of Borders’ more than 500 stores will create sections next month dedicated to Build-a-Bear, the maker of kits kids can use to craft stuffed animals, Chief Executive Officer Michael Edwards said in an interview. The new areas also will feature books and DVDs tied to the brand.. . . more

Consumer spending rises at fastest pace in four months

Americans spent last month at the fastest pace in four months, helped by a jump in demand for automobiles.

Consumer spending rose 0.4 percent in July after three lackluster months, the Commerce Department said Monday. Spending fell 0.1 percent in April, rose a tiny 0.1 percent in May and was flat in June.. . . more

What Williams-Sonoma's Earnings Say About the Consumer

Talk about bucking the trends!

Williams-Sonoma's latest results not only trounced analysts' forecasts and prompted the company to raise its outlook for the year, but the retailer did so against some pretty challenging headwinds.

The results prove two things: Affluent consumers have money if they want to spend it, and retailers can coax them to spend—if they have the right merchandise and an appealing message.

Retail earnings over the past few days have continued to paint a picture of a wary consumer. In many cases, retailers have used cost controls to squeeze out profits, as sales remained weak. . . . more

Friday, August 27, 2010

NRC Looks For Buyers on Nine Foreclosures

NRC Realty & Capital Advisors LLC, based here, has been retained in the sale of nine retail properties currently in foreclosure in California, Delaware and Pennsylvania. The facilities total almost 20,000 square feet, and include gas stations and convenience stores.

Evan Gladstone, managing director of NRC, tells GlobeSt.com that a national lender hired his company to auction the sites. The bid deadline is Sept. 30. “The number of commercial properties being surrendered to lenders is definitely increasing,” Gladstone says. . . more

How Gap's 'Groupon' Went Crazy Viral

The Gap's special last Thursday on Groupon went viral and was wildly purchased, but it wasn't merely due to the lucrative 50 percent discount offer. A marketing mix involving social media, affiliates and an ad on Digg supplemented Groupon's e-mail program in the effort. . . more

Target expands presence in consumer electronics

Target is aiming to get more of a charge out of the consumer electronics business. Target announced Wednesday it's expanding its selection of wireless phones. Customers can also avail themselves of an electronics recycling program, and free tech support for TVs and other electronics they buy from Target.

"All of that will help them become a destination for electronics, and I think that's very important," said Howard Davidowitz, a retail analyst and consultant. Even though there's a lot of competition in that market from its archrival, Walmart, as well as Best Buy, Target wants to become a go-to store for shoppers seeking electronics. . . more

U.S. stores look north for school sales

U.S. retailers are hoping to cash in on what’s expected to be a solid back-to-school season in Canada, while predictions on their home turf are less than rosy. An estimate of a 4% to 5% climb in retail back-to-school sales in Canada represents a bounceback after an overall sales drop of 4% to 6% in categories such as apparel, electronics and other school supplies during the same period of 2009, according to Ernst & Young. . . more

Salem vs. Lynn tilt in store

The battle line is being drawn between Salem and Lynn over a 15-acre parcel on Highland Avenue that's being eyed for a new Lowe's and an expanded Walmart. In May, the Lynn City Council passed a resolution opposing the project. Last week, Lynn Mayor Judith Flanagan Kennedy publicly came out against the project. She did not return two messages left at her office yesterday.

"We're 100 percent against it," said Lynn Councilor-at-Large Dan Cahill, who lives on nearby Bellaire Avenue.

He was among a group of Lynn politicians who met in private with the board of Camp Lion, which owns the property and has plans to sell it to Revere developer the Kennedy Group Inc. . . more

Thursday, August 26, 2010

Home Depot Gains By Turning Recession into Opportunity

Home Depot is gaining in the weak recovery, and it’s fair to say that its ability to use the recession to boost efficiency is helping it muddle through more successfully than some other retail giants, including Walmart.

Frank Blake, Home Depot’s CEO, has insisted that an economic downturn is a terrible thing to waste. And Home Depot has had a lot of downturn to use.. . . more

Brookfield to run General Growth spinoff

Brookfield Asset Management has been tapped to own and develop more than 78,000 acres of undeveloped land now held by General Growth Properties Inc.

General Growth registered Wednesday the spinoff, Spinco Inc., with the U.S. Securities and Exchange Commission.

Brookfield is one of several investors that have proposed to help General Growth exit from bankruptcy and is in line to hold a 30 percent stake in the Chicago-based real estate investment trust once it has completed its restructuring.. . . more

Target, Walmart dressed to kill

The discount retailers are prettying up their stores to woo grocery customers.

Discount giants Target and Walmart are both aggressively remodeling their fleet of local stores with a focus on expanding their grocery sections. . . . more

Target making move into mobile

Target Corp. is making its boldest move yet into the competitive consumer electronics market, announcing a series of steps aimed at boosting sales and enhancing customer service.

The Minneapolis-based retailer said Wednesday it is joining with RadioShack to add mobile phone centers in about 850 of its 1,743 stores by year's end, with a nationwide rollout expected by the middle of next year.. . . more

Distress Expected to Plateau at $200B

Delta Associates will report this week some welcome news for the commercial real estate industry, namely that signs suggest the level of distressed properties will plateau at the $165-billion-to-$200-billion range. As of right now, the total value of distressed commercial real estate in the US has reached $186.9 billion, including properties in distress, foreclosure and lender REO, according to data from Real Capital Analytics.

Distressed assets in the US have increased 12% ($20.1 billion) since Delta’s June 2010 report. In short, after a decline in June, the total is back to its March level.

There is a real likelihood that it won’t rise much further, though . . . more

Wednesday, August 25, 2010

Costco Sees Malls As The Next Way To Grow Business

Costco Wholesale Corp. (COST) is taking on the role of mall anchor, moving into spaces once occupied by department stores that for decades reigned as the retail centers' big draws. Costco plans "to accelerate" steps that will in essence put its mini-mall type stores into shopping centers, the warehouse club's co-founder and chairman, Jeff Brotman, said in an interview. Costco's stores, which can be the size of three football fields minus endzones, carry tens of thousands of items, ranging from tires to polo shirts to pigs feet. . . more

Tuesday, August 24, 2010

Hooters Taps Colliers to Lead Expansion

Hooters of America, Inc. has selected Colliers International to help spearhead an ambitious expansion agenda. The restaurant chain says it plans to increase its location count by at least 15 to 20 percent annually over the next several years. Currently, Hooters has more than 455 locations worldwide, with restaurants in 29 countries on six continents. . . more

Inside the secret world of Trader Joe's

Apple's retail stores aren't the only place where lines form these days. It's 7:30 on a July morning, and already a crowd has gathered for the opening of Trader Joe's newest outpost, in Manhattan's Chelsea neighborhood. The waiting shoppers chat about their favorite Trader Joe's foods, and a woman in line launches into a monologue comparing the retailer's West Coast and East Coast locations. Another customer suggests that the chain will be good for Chelsea, even though the area is already brimming with places to buy groceries, including Whole Foods and several upscale food boutiques. . . more

Target redesigns five Denver stores to focus on fresh food, value, convenience

Target Corp. announced Tuesday that it has redesigned five Denver-area Target stores toward delivering one-stop shopping attributes.
The five stores -- located in the Denver suburbs of Arvada, Aurora and Englewood, Colo., as well as in Boulder and Greeley, Colo. -- feature an open-market grocery layout with increased fresh-food selections, and reinventions in several other areas throughout the store such as beauty, home, shoes and electronics.

Target said the redesigns offer 90% of the categories found in a grocery store, interactive displays and wider aisles to make shopping easier and more enjoyable. . . more

New Friendly’s CEO looks to build up brand

As Friendly’s Ice Cream Corp. marks its 75th year, new CEO Harsha Agadi has an ambitious goal for the Wilbraham chain that generates $725 million in annual sales.

To get there, Agadi is eyeing domestic and overseas expansion for Friendly’s restaurants and, in the next five years, a doubling of sales of packaged ice cream, which is distributed in 4,000-plus retail outlets and accounts for a significant portion of total revenue.. . . more

Borders CFO resigns for new job

Borders Group Inc (BGP.N) said on Monday that chief financial officer Mark Bierley had resigned to take another job, the latest personnel move to hit the brick-and-mortar bookseller, which is trying to turn around its business.

Borders has been working to lower debt and improve sales in the midst of widespread weakness for traditional book sellers as more consumers shift to digital books.. . . more

Mass. home sales drop in July for first time this year

The sales of Massachusetts single-family homes fell 26 percent in July, reversing a trend of 12 straight months of increases, the Warren Group reported this morning.

Earlier this year, a temporary federal tax credit for buyers helped give the housing market a lift --- thanks largely to the tax credit, June had the highest number of local monthly sales in four years as home buyers scrambled to take advantage of the tax credit before its expiration. . . . more

Barnes & Noble posts larger-than-expected loss

Barnes & Noble Inc reported a larger-than-expected quarterly loss on declining sales at its namesake brick-and-mortar stores and costs to develop its Nook electronic book reader.

Shares of the largest U.S. bookstore chain fell nearly 3 percent.. . . more

Why Staples has the upper hand on its competitors

A top-line miss, plus economic fears, sent shares of office supply retailer Staples downward Thursday. But the “disappointment” serves to highlight how high expectations are for the company – and may have created a buying opportunity to pick up the industry’s top performer at a discounted price.

On a day that had markets spooked by fears of U.S. economic stagnation, Staples invited its decline: It reported lower-than-expected second-quarter sales and also trimmed its 2010 profit forecast. . . . more

Department stores look for growth outlet

While most apparel retailers are still feeling their way out of the economic darkness, department store outlet chains remain in growth mode, catering to the budget-minded.

Nordstrom, Saks, Neiman Marcus and, last week, Bloomingdale's have shifted most of their growth capital to their outlet units. . . . more

Monday, August 23, 2010

Dollar Tree Dreams Of 7,000-Store Network

The Dollar Tree discount chain has said it sees enough potential to open up to 7,000 outlets across the US, adding that it will continue to rapidly expand its network. The chain currently operates 3,925 stores, and will add 230 additional stores by the end of the year.

The comment came even as the chain reported strong results for its fiscal second quarter, ending 31 July. For the period, net profit surged up 37.1% to $78m, while sales rose by 12.7% to $1.4bn, and like-for-like sales were up 6.7%. For the combined first half, net profit was up a strong 20.7% to $141.6m, with sales rising by 12.7% to $2.7bn, and like-for-like sales up 6.6%.. . . more

Barnes & Noble proxy war and earnings complicate sale

The war that has erupted between Barnes & Noble Inc's two largest shareholders over control of the bookseller is putting a wrench in its plans to sell itself and could make the retailer less appealing.

The company is expected to report a quarterly loss on Tuesday, and the extent of the damage is likely to affect who shareholders vote for at next month's annual meeting.. . . more

Court to decide Westford, MA project

Cleared acres along Route 110 is the first sign of what may become a "lifestyle center" of mixed-use retail catering to upscale clientele, but a court will decide the next step.

Westford developer Robert Walker has all required town permits to build Cornerstone Square, with 253,000 square feet offices, restaurants and other personal services. Last year, the Westford Valley Marketplace Inc. filed an appeal in Land Court, challenging the Planning Board's approval of the plan and alleging the project will "jeopardize Westford Valley's property interests." . . . more

Women hit the stores -- and pay full price

The female shopper has returned to stores, ready to buy and not afraid to pay full price -- at least judging by the results from AnnTaylor Stores Corp.

Not too long ago, AnnTaylor was in a bit of a bind. The company was reeling from merchandise misses, a revolving door of management, bloated inventory, too many stores and a customer addicted to margin-eroding markdowns. . . . more

Commercial Real Estate: The Next Economic Shock?

With the economy on uncertain footing, one area of continuing concern is the commercial real estate market, where over a trillion dollars of loans will come due over the next few years. Many of those loans were made at the height of the real estate bubble, and more than half are now underwater, meaning that borrowers owe more than the properties are worth.

Commercial real estate is different from home mortgages, where buyers typically get a 30-year mortgage and then pay a portion each year with the goal of paying off the loan. Commercial loans are refinanced every three to 10 years and normally, that’s not a problem.. . . more

Friday, August 20, 2010

Big Box Retail Users Eye Rebound

While the past few years have witnessed a massive increase in the amount of vacant retail space on the national “big box” market, many other retailers with expansion plans see opportunity in these larger spaces made available by struggling or failed retail chains. So says the Big Box Dilemma, a new white paper from Seattle-based Colliers International.

According to Colliers, nearly one-third of the nation’s top 500 retailers have increased their growth plans for 2011 and beyond. “Strong store sales during the first half of 2010 have emboldened these companies to lock in competitive lease rates in new locations.”. . . more

Pinkberry opens its doors in Hingham’s Derby Street Shoppes

Many South Shore residents will get their first taste of a chain behind the national resurgence of interest in frozen yogurt when Pinkberry opens its doors today in Hingham’s Derby Street Shoppes. This 1,200-square-foot location is the first of several Pinkberry shops that the California-based chain has in the works in Greater Boston. So far, only one other Boston-area lease – for a spot on Newbury Street in Boston’s Back Bay – has been signed. Ron Graves, Pinkberry’s CEO, declined to disclose the other locations where Pinkberry wants to open.

“We plan to open several stores in the Greater Boston market beginning with these two,” Graves said. “The only thing that prevented us from getting here earlier is finding the right partner, and now we’ve found the right partner.”. . . more

Greater Hartford, CT Retail Market Report Preview

Total retail space in the Greater Hartford region included 37.0 million square feet at the end of the 2009-10 study period, a slight drop from the 37.2 million square feet reported last year. Total inventory declined modestly during the 13-month time frame, a result largely of the deletion from the database of Broad Street Parkade, a defunct 228,500 square foot shopping center in Manchester that had remained entirely vacant for nearly a decade. The City of Manchester is planning a revitalization project along Broad Street for largely non-retail use, which would incorporate this obsolete facility. . . more

Waterfront Group Picks Hines for $800M Project

Waterfront Toronto, a public-private group charged with redeveloping the city’s land area at Lake Ontario, has selected Texas-based Hines to build an $800 million mixed-use complex on 10 acres in the East Bayfront district. The project, to be called Bayside, would have a mix of condos, apartments, offices and retail.

The City Council’s Executive Committee has approved the project, planned for vacant industrial land south of Queens Quay Boulevard between Lower Sherbourne and Parliament streets. The full council is expected to vote on the plan by Aug. 25.. . . more

Great Recession Reset Priorities

One day you're the brightest star in the galaxy. Then something new comes along -- and suddenly you're a relic. It's a turn of fate that awaits sports heroes, movie stars, political leaders. And, yes, even household appliances.

After occupying center stage in the American household for much of the 20th century, two of the grand old luminaries of consumer technology -- the television set and the landline telephone -- are suffering from a sharp decline in public perception that they are necessities of life.. . . more

Pent-Up Demand for Core, Distressed Shopping Centers

While still a far cry from the avalanche some predicted would hit the market a year ago, distressed shopping malls and strip centers have contributed to a marked increase in retail sale activity this year. At the same time, a rush by institutional investors to pick up quality core properties at the other end of the retail property spectrum has also led to an increase in retail property sales in a number of large metro markets, according to CoStar Group data.

Houston, Tampa/St. Petersburg, South Florida, Long Island, Boston, Detroit, Philadelphia, Los Angeles, Denver and Phoenix all reported double-digit increases in retail property sales volume in the second quarter. . . . more

AnnTaylor sees rebound at namesake chain

Women's clothing retailer AnnTaylor Stores Corp (ANN.N) said quarterly sales rebounded at its namesake stores, and it was able to sell more merchandise at full price.

The company posted a 6.1 percent increase in comparable sales, which include online. Sales at stores open at least a year, or same-store sales, rose 19.6 percent at the namesake Ann Taylor chain.. . . more

Discount chain Dollar General to sell beer, wine

Discount retailer Dollar General Corp. has begun selling beer and wine in some of its stores in the Southeast.

The Goodlettsville, Tenn.-based company has sold food and drinks for years in its 9,000 stores in 35 states — along with everything from home decor items to health and beauty supplies and apparel.. . . more

Job growth holds up in Mass.

Massachusetts employers added jobs for the sixth consecutive month in July as the state economy continued a broad recovery that is outpacing the nation as whole.

The state gained more than 13,000 jobs last month, while data revisions showed that employment growth in June, nearly 3,000 jobs, was far stronger than initially estimated, the Executive Office of Labor and Workforce Development reported yesterday. The state unemployment rate held steady at 9 percent.. . . more

Ocean State Job Lot Coming to Medford, MA

It looks like the adventure is about to begin for Ocean State Job Lot here in Boston’s inner suburbs. The discount retail chain that has proven a savior for shuttered storefronts throughout New England during the past year has closed on 30 Commercial St. in Medford for $6.1million.

Touted as “The Home ofAdventure Shopping,” Ocean State acquired Medford’s former Stop&Shop building from the Quincy based supermarket giant.. . . more

Thursday, August 19, 2010

Staples profit up, but taxes bite outlook

Staples Inc. reported a higher quarterly profit, meeting expectations, and said it expects a modest economic recovery during the rest of the year.

However, the top U.S. office products retailer trimmed the high end of its full-year earnings outlook as expectations for a higher tax rate outweighed the economic outlook and the resumption of share buybacks.. . . more

Clean Bill of Health for Regional Mall REITs in Second Quarter

Fundamentals continued to improve for regional mall REITs during the second quarter of 2010, leading analysts to conclude that the sector had largely shaken off the aftereffects of the recession.

For the three months ended June 30, three regional mall REITs beat consensus analyst estimates on FFO per share and two were in line with expectations. . . . more

Casual Male CEO sees "big man's heaven" in new store

Casual Male Retail Group Inc says its new store concept, Destination XL, is seeing higher average transactions at its first outlets in a key test for the big and tall men's apparel chain.

Destination XL will eventually supplant the company's two chains currently serving shoppers at different price ranges: Casual Male XL and the higher-priced Rochester Big & Tall.. . . more

Macy's a Bright Spot in Department Store Arena

Macy's posted a strong second quarter that featured an earnings surge and a same-store sales boost of 4.9%. The success comes as retailer turned in a lackluster July sales performance that many say doesn't bode well for the holiday season.

Management largely credits the My Macy's program, which caters merchandise toward local markets instead of offering the same goods at stores through its 800-unit network. It says this strategy greatly reduced the need to discount and boosted profitability.. . . more

Target's income rises; firm to emphasize food

Target Corp. is counting on driving customers into its stores in the coming months with two weapons: a 5 percent discount for its store credit-card holders and an emphasis on food.

Even with those, the company offered a conservative sales outlook as a slowing economy weighs down its expectations.. . . more

Sears results miss estimates

Retailer Sears Holdings Corp reported a wider-than-expected quarterly loss on Thursday as consumers curbed spending in a grim U.S. economy.

The company, run by hedge fund manager Edward Lampert, blamed a lackluster performance by its Kmart discount chain on weak food sales. Sears' namesake department stores suffered from reduced demand for lawn and garden products, tools and consumer electronics.. . . more

Wednesday, August 18, 2010

BJ's 2Q net income edges up, cuts yearly view

Warehouse club operator BJ's Wholesale Club Inc. said its second-quarter net income rose 2 percent, but the company lowered its guidance for the year.

It expects revenue to rise 8 percent to 10 percent, from earlier guidance of a 9.2 percent to an 11.2 percent rise. The change is due to lower expected sales of merchandise. Expectations for sales of gasoline remained unchanged.. . . more

Some stores finding deep discounts aren't enough

A dollar for a 40-ounce bottle of ketchup? Yawn. Four bucks for a 12-pack of Coke? No sale.

Even deep discounts on everyday items don't seem to be enough to get Walmart shoppers to bite these days, and other chains are worried Americans won't be in the mood to spend in the months ahead, which are critical for those companies.. . . more

Westfield's Lowy Sees No `Double Dip' as U.S. Shopping Mall Sales Recover

Westfield Group, the world’s largest owner of shopping centers by market value, doesn’t expect a double-dip recession in the U.S. after a recovery in the world’s biggest economy helped drive a return to profit.

“From an operating point of view, we’re not planning on a double dip,” Westfield co-Managing DirectorPeter Lowy said in a telephone interview today. “The real issue for us is not whether you’ve got 4 percent GDP growth or 3 percent or 2.5 percent, but the fact that we still have growth. Growth in sales from our retailers means we’re in a better position this year than we were last year.” . . . more

Charting the Market’s ‘Irrational’ Behavior

An upbeat outlook may be a welcome contrast to the end-of-the-world mindset that hung over the industry following the capital markets meltdown, but Morrison Foerster’s Mark Edelstein is concerned that it’s a little early to morph into Sunny Jim. “We had irrational exuberance a few years ago, and now we have irrational optimism,” Edelstein tells GlobeSt.com.

Chair of his firm’s real estate finance and distressed assets practices, Edelstein notes that there is enough market activity to justify a positive mood swing, with the CMBS revival gathering steam and new funds being launched. But he points out that real estate fundamentals by and large really haven’t improved so much as they’ve stabilized.. . . more

Saks Closing Stores, but Sales Increase

Luxury department-store chain Saks Inc. is experiencing a sales rebound, even if it is closing stores during that boost. The retailer announced during its second-quarter results that it is closing a total of five stores this year and named locations in Plano, TX and Mission Viejo, CA as the latest to go dark.

Saks' sales are up, though, with same-store revenues increasing 4.6% and management predicting similar increases for the rest of the year. The need to discount less is apparently helping the chain.. . . more

Abercrombie to close 110 stores within two years

Abercrombie & Fitch announced plans to close about 110 of its 1,067 U.S. stores. Sixty of the stores marked for closure are traditional Abercrombie and Fitch stores or Abercrombie Kids stores that are reaching the end of their leases this year, said CFO Jonathan Ramsden on the retailer’s quarterly conference call with investors. An additional 60 stores will shutter in 2011 as their leases expire, he added. “The total number of closure could increase if we are able to negotiate additional buyouts on underperforming stores with later lease expirations,” Ramsden said.

The closings come in spite of the chain’s recent slight turnaround in fortunes. . . . more

Tuesday, August 17, 2010

American Apparel's future in jeopardy

Casual clothing chain American Apparel, suffering a steep sales slump and manufacturing problems, warned Tuesday that it might default on loans and not be able to stay in business.

The company, which operates 279 stores in 20 countries, said it expects same-store sales, or sales at its stores open at least a year, to tumble 16% in its second quarter. The company expects to post a loss from operations of between $5 million to $7 million in the quarter.. . . more

Big Box Retail Users Eye Rebound

While the past few years have witnessed a massive increase in the amount of vacant retail space on the national "big box" market, many other retailers with expansion plans see opportunity in these larger spaces made available by struggling or failed retail chains.

According to The Big Box Dilemma, a new White Paper from Colliers International, nearly one-third of the nation's top 500 retailers have increased their growth plans for 2011 and beyond. Strong store sales during the first half of 2010 have emboldened these companies to lock in competitive lease rates in new locations.. . . more

Sales tax holiday spurs spending spree, big-ticket purchases

Whopper of weekend

Retailers in Massachusetts selling TVs, computers, appliances and furniture saw sizeable jumps in business as consumers ventured out to avoid paying the 6.25 percent state sales tax on items priced under $2,500.

The Department of Revenue estimated shoppers would save $20 million to $23 million on purchases, while the Retailers Association of Massachusetts forecast weekend sales, including those of taxable items, of $500 million.. . . more

Costco Tantalizing DC's Gateway

Twenty years in the making, and plans to develop Washington DC's first Costco at Dakota Crossing are still trudging along. The stage set is a remote patch of forested land in the Fort Lincoln neighborhood, better recognized as the land opposite the Washington Times on Route 50.

But development has hit two main obstacles. The first is getting retailers to commit to a large project in a suburban setting, which tests current financing models, although Costco has signed a non-binding Letter of Intent to occupy the property. . . . more

Wal-Mart Says Consumers Still Wary

Wal-Mart Stores Inc posted its fifth-consecutive quarterly drop in U.S. same-store sales and said it would focus on curbing expenses to help boost profits this year as consumer sentiment remains soft.

The world's largest retailer posted a higher-than-expected quarterly profit and raised its full-year forecast on Tuesday, helped by cost cuts and international growth.

But analysts questioned how much longer the company could count on cost cuts to fuel profits while U.S. sales struggled.. . . more

A&F returns to 2Q profit; to close 60 stores

Preppy teen retailer Abercrombie & Fitch Co. returned to a profit in the second quarter as its strategy of lowering some prices boosted sales.

The chain also said Tuesday it will close 60 stores in the U.S. in 2010 as it expands internationally.. . . more

City calling for Greenway-specific zoning rules

Goals are lively parks, careful development

Boston officials are scheduled tonight to consider new zoning guidelines that would determine the size and shape of the skyline along the Rose Fitzgerald Kennedy Greenway.

In reviewing property around the Greenway, city officials concluded that developers could build as much as 3 million square feet of stores, residences, hotels, and offices in coming years.. . . more

Former Kmart building in Haverhill to be site of bigger Market Basket

After years of being empty and rumors about what new business might move into the former Kmart building in Westgate Plaza, the answer appears to have been right next door.

City officials said the Demoulas family, which owns the plaza, has plans to move their Market Basket from one end of the plaza to the other and into a larger building once occupied by W.T. Grant and then Kmart, which closed seven years ago.. . . more

Monday, August 16, 2010

Independent Retailers Fight for Survival

Analysts say privately held retailers are suffering greater sales declines than public company retailers. Independent retailers saw a sharper decline in sales during the recession due to limited advertising budgets and less "muscle" in dealing with suppliers. Independent retailers also need to harness the power of web sites and social media.

With a retail real estate market that often prices smaller stores out of high-traffic areas and an economic downturn forcing consumers to cut down on discretionary spending, some private retailers are having a tough time. . . . more

J.C. Penney Cuts FY Forecast After Weak Q2

J.C. Penney has cut its full-year profit forecast after a slowdown in consumer spending hurt its results for the second quarter. The company said the downgrade reflects “a conservative approach to what continues to be an uncertain consumer climate, particularly for the moderate consumer”.

CEO Myran Ullmann added that Penney’s customers “tend to be more urban, more ethnic and more impacted by the economy than many others in the overall retail landscape”, making them particularly sensitive to fluctuations in the job market.. . . more

PREIT Agrees to Sell up to Seven Power Centers

Pennsylvania Real Estate Investment Trust today announced the signing of agreements for the sale of its interests in up to seven power centers to Cedar Shopping Centers, Inc.

Under the agreements, PREIT will sell five wholly-owned power centers to Cedar for approximately $134 million. A portion of the proceeds will be used to repay approximately $40 million of mortgage debt secured by three of the properties and to pay approximately $57 million to release two properties securing PREIT’s 2010 Credit Facility. This transaction is expected to close by the end of 2010. . . . more

Barnes & Noble unable to reach settlement with Burkle

Barnes & Noble said Thursday it has not reached a settlement with billionaire investor Ron Burkle's Yucaipa Cos. The announcement followed on the heels of various reports that the two companies were close to a deal.

“Barnes & Noble and Yucaipa were unable to conclude an agreement on mutually acceptable terms,” Barnes & Noble said Thursday in a statement.. . . more

Lowe’s earnings rise 9.6%

Lowe’s Cos. Inc.’s earnings continued to improve in the second quarter as the home-improvement retailer managed its expenses and waited for the economy to improve.

Sales increased 3.7 percent to $14.4 million from $13.8 million in the second quarter of 2009. Sales at stores in operation for more than a year rose 1.6 percent.. . . more

Back-to-school standoff risks profit margins

The back-to-school shopping season is off to a slow start as retailers and consumers wait to see who will blink first.

Americans are looking for more discounts, and retailers are trying to hold out in an effort to protect profit margins, said Craig Johnson, president of the New Canaan, Connecticut-based consulting firm Customer Growth Partners. . . . more

A&P supermarket chain to close 25 stores

Grocery store operator Great Atlantic & Pacific Tea Co. Inc. said today that it will close 25 of its 429 stores as it implements a turnaround strategy.

The Montvale, N.J.-based company operates 30 stores in the Philadelphia area under the A&P, Pathmark and Superfresh names. The 25 affected stores, to close by later this year, are in Pennsylvania , New Jersey, Connecticut, Maryland and New York, but the company would not identify specific locations, spokeswoman Lauren La Bruno said. She said 2,000 employees will be impacted.. . . more

Friday, August 13, 2010

Retail Needs to Brace for Lease Accounting Change

The commercial real estate industry is awaiting--with much trepidation--the forthcoming new draft rules from the Financial Accounting Standards Board on lease accounting. A seemingly arcane bit of accounting, these rules will in fact have a major impact on how tenants and landlords account for leases on their balance sheets.

What the industry already knows about the forthcoming draft suggests the change will not be pretty: there are two changes companies have to worry about. One, all lease obligations are going on the balance sheet--all rent obligations, in other words, will be capitalized as a form of debt financing. The second concern is that the occupancy expense that runs through the P&L will increase substantially, but companies will no longer be able to recognize rent expense. Instead, it will be an amortization of an asset they have. . . more

Stores hope tax holiday will provide needed boost

For retailers, this week has been the lull before what they expect will be a storm of customers tomorrow and Sunday, when the state’s 6.25 percent sales tax on most products is temporarily suspended. The cash registers at many stores have been quiet in recent days, as consumers have been sizing up what they want, but holding off on making major purchases so they can reap savings this weekend. . . more

Filene’s retail plan defended

An alternative Filene’s redevelopment plan rejected by Boston’s mayor would generate jobs and shopping activity in Downtown Crossing, retail experts say.

“There are at least five apparel retailers looking at that site right now,” said Mark Browne, a principal at Berenson Browne Advisors, a downtown retailer broker.

Back in January, developer John Hynes, searching for ways to restart the financially strapped project, pitched a scaled-down version of just stores - including a new Filene’s Basement - and underground parking . . more

Thursday, August 12, 2010

City hits store landlord

Four years after a Downtown Crossing bookstore closed, the city is blasting the landlord for refusing to lease the space and letting the building fall into disrepair.

“It’s very frustrating to have such a prime location stay empty for so long,” said Randi Lathrop, the Boston Redevelopment Authority’s community planning deputy director. “It’s a mystery to us why it continues to be vacant. The only explanation is that the owner is asking way too much rent. . . . more

Report: July total U.S. retail sales mixed

A report released Thursday by MasterCard Advisors found that July total retail sales edged up, but not as much as in June.

According to SpendingPulse, MasterCard Advisors’ report that tracks national retail and service sales, in July total retail sales, ex-auto, grew by 1.4% year-over-year with seasonally adjusted month-to-month sales declining by 0.9%.

Excluding auto and gasoline, on a seasonally unadjusted basis, year-over-year sales in July grew by 1.0%, slightly below June’s 1.1% increase. . . more

rue21 opens 600th store

Rue21 said Thursday it has opened its 600th store, located in North Attleboro, Mass. The specialty apparel retailer also announced it has opened its 400th etc! format rue21 store in Saugus, Mass. The format was introduced four years ago to highlight expanded accessory categories and has been incorporated into all new rue21 stores and remodels, according to the retailer. . . more

Barnes & Noble unable to reach settlement with Burkle

Barnes & Noble said Thursday it has not reached a settlement with billionaire investor Ron Burkle's Yucaipa Cos. The announcement followed on the heels of various reports that the two companies were close to a deal.
“Barnes & Noble and Yucaipa were unable to conclude an agreement on mutually acceptable terms,” Barnes & Noble said Thursday in a statement. . . more

Developer looks to move on N. Station supermarket

After years of delays, a new developer is proposing to begin construction next year on a supermarket and up to 275 apartments at the northern edge of the Rose Fitzgerald Kennedy Greenway.

Trinity Financial of Boston, which also developed the Avenir apartment complex above North Station, was selected by transportation officials Wednesday to redevelop an adjacent lot where a prior developer failed to proceed with an office and retail complex.

The prior developer, Hines Interest LP of Houston, was issued a default notice in May for failing to begin construction on the project, clearing the way for transportation officials to transfer development rights to Trinity. Trinity had been the second place bidder in 2005. . . more

Wednesday, August 11, 2010

Landlords Worry About Closures As Barnes & Noble Contemplates Alternatives

With Barnes & Noble announcing that it is considering strategic alternatives, including a sale of the company, retail property owners have to be wondering if they are in for another round of big-box closures.

The chain is the leading brick-and-mortar bookseller in the country—a business that has come under strain because of a decline in discretionary spending, intense competition from Amazon.com and the increasing popularity of e-readers. . . more