Across the U.S., retail real estate development that outpaced demand marked the early years of the new millennium. Now retailers are going bankrupt at a record rate, and hedge funds are betting against the commercial mortgages used to finance mall properties. Credit Suisse this month predicted that as many as 275 malls, a quarter of the U.S. total, will close in the next five years.
The woes of brick-and-mortar retail come partly from the rise of e-commerce, which has grown to about 8 percent of retail sales, from less than 1 percent in 2000. But they are also self-inflicted, according to Suzanne Mulvee, director of research at CoStar Group Inc. The industry built new stores faster than the consumer could spend at them. . . . more