Competition for retail space could increase this year as U.S. retailers resume expansion plans delayed since 2008, according to ChainLinks Retail Advisors, an advisory services firm serving retailers, landlords, and investors in North America.
The firm’s recently published National Retailer and Restaurant Expansion Guide reports retailer demand for real estate is up across the board.
“As 2010 came to a close, growth plans were up 30% from the levels we recorded last year,” said ChainLinks Research Director, Garrick Brown. “Following the strong performance during this year’s holiday sales season, many chains further upped their growth plans. Right now, expansion plans are up 40% over last year’s levels.”
The report jibes with recent news from Big 5 Sporting Goods, REI, Dick’s Sporting Goods, The Sports Authority and Academy Sports, which have all indicated plans to increase the pace of store openings this year.
“The strongest surge in growth plans has been in those markets where unemployment is lowest,” said Brown. “The greater Washington DC area remains highly desirable, as does the Eastern Seaboard from Boston to the Carolinas. We have also seen a considerable increase in retailer requirements in the Chicago market and Texas. Though both have elevated unemployment, both Florida and California have also seen a spike in retailer demand in most markets.”
“Ultimately,” Brown concludes, “the current surge demonstrates to us two key factors; the return of optimism within the retail sector, and the desire to expand quickly now-while rents are still low.”
