Quarterly reports paint a vibrant picture for physical retail

5/5/2017
Current media reporting on the state of physical retail is mostly doom and gloom. But analysts at real estate research company CoStar listened in on the latest wave of Q1 earnings calls and discovered a generally bullish attitude for brick-and-mortar retail among developers.

“I just think the [negative] narrative is a way ahead of itself," a CoStar report quoted Simon Properties CEO David Simon as saying.

Simon reported 95.6% occupancy at Simon properties along with strong consumer traffic that had its mall and outlet center retailers averaging sales of $615 per square foot.

General Growth Properties CEO Sandeep Lakhmi Mathrani asserted that there was "a wide discount between public and private markets," and that the sum value of GGP's properties was far greater than its current stock price.

Acadia Realty Trust CEO Ken Bernstein attributed the current round of retailer downsizings in part to once-strong chains that have lost their edge and others that have over-extended themselves or under-delivered.

“There has been a flood of [unfavorable] news about retailing and retail real estate, and while there is reason for legitimate concern, there is too much over-generalization going on," Bernstein said.

"The good news,” he added, “is that over time, the pricing subsidies in e-commerce will likely moderate and traditional retailers will have competitive omnichannel capabilities that complement their bricks and mortar locations."

Simon concluded that “we've all got to have a better experience for the consumer because they're a tough nut to crack. We're frustrated only by the narrative, but not by what's happening in our business."

Click here for more.
X
This ad will auto-close in 10 seconds