Wednesday, February 9, 2011

Retailers see brighter 2011

"Turn to your neighbor and congratulate them for still being in business," the emcee told the crowd Wednesday night at a panel discussion for retailers at the Bechtler museum uptown.

Retailers at the discussion, hosted by the International Council of Shopping Centers, echoed his theme: Glad to still be around, and hopeful for the coming year.

They said they can see signs of recovery, in the Charlotte market and nationally.

"We're going to have a solid increase," said Greg Wilson, vice president of real estate at Belk. "We've seen big increases in all stores around the Charlotte market, led by SouthPark, which is a good sign the luxury customer is back."

Michael Udekwu, of apparel retailer Cato, said his store expects "flat to slow growth" but is continuing to open new stores around Charlotte. These include Cato, its Fashion Metro concept, and a new accessory-focused, smaller women's shop.

But there are still plenty of mixed signals and reasons to be concerned.

"I don't think we're through this economy," said Kent Gonnerman, real estate manager for Rack Room Shooes. "Hopefully, we'll see some stability in employment and more aggressive spending. We still see a lot of very calculating customers, focused on value, and if you don't deliver that, they won't buy from you."

"The only buyers for land right now are speculators and bottom feeders," said Fitzhugh Stout, managing director of real estate firm Integra's Charlotte office. He said land is still being sold at deep discounts, and it could be four years before significant new retail space construction begins.

"We were late entering the recession phase, and we'll be late entering the recovery phase," he said of the Charlotte market. Retail vacancy rates in the city's market were about 9.5 percent in last year's third quarter, compared to 6.7 percent the same time a year prior, he said.

Still, the market has stabilized and some properties are appreciating again, Stout said. "Every indication we've seen is 2011 will be a better year than 2010."

What do you think the coming year holds for retailers - a robust recovery or more shakiness?