Mall vacancies hit their highest level in at least 11 years in the first quarter, new figures from real-estate research company Reis Inc. showed. In the top 80 U.S. markets, the average vacancy rate was 9.1%, up from 8.7%.
The outlook is especially bad for strip malls and other neighborhood shopping centers. Their vacancy rate is expected to top 11.1% later this year, up from 10.9%, Reis predicts. That would be the highest level since 1990.
In 2005, the mall-vacancy rate hit a low of 5.1%. For strip centers the boom-time low vacancy rate was 6.7% that same year.
Combine that with the growing number of grocery store bankruptcies, restaurant chains folding, and the death of the strip mall video store, and you have the recipe for a major disaster. That's right, folks: in just six years, retail vacancies have basically doubled, and as millions of square feet of brand new retail space continues to be created, we're reaching a point here where the entire game breaks down. Remember, retail vacancies now are higher than they were when the recession supposedly "ended" in 2009 and they continue to increase as more supply is added and more retailers go under.
Another wave of restaurant closings is on the way this summer as gas and food inflation hit your favorite watering hole. Remember Bennigans and Steak & Ale? Mervyn's and Linens N' Things? Circuit City? They were nuked by $4 a gallon gas. This time around they will be joined by a whole lot more places to eat and to shop as inflation and competition get ugly this summer.
And remember, these retailers and restaurants provide jobs. Not high-paying ones by any means, but jobs. Even those are getting swept away in the flood.
No folks, it's going to be a long, hot summer.
Posts
No comments:
Post a Comment