Wednesday, July 20, 2016

Preview : KeyPoint Report for Southern New Hampshire

While the 2016 KeyPoint Report for Southern New Hampshire, based on our proprietary  GRIID™ retail database, is in production, we will again share some of the early results:

Inventory and Vacancy Rate: The retail inventory in Southern New Hampshire included 29.8 million square feet in 2016. This represents a net decline of 109,400 square feet, or 0.4%, resulting largely from retail demolitions and conversions to non-retail space.  There were significant new store additions, however, negating most of the reduction in square footage within the region. The single largest new development was Walmart Supercenter in Manchester, replacing a nearby traditional store which will be converted to Carmax. The largest demolition in the region was the former Macy’s building in Bedford. This site will be redeveloped as a mixed-use project dubbed Bedford Place, including retail, office, medical and restaurant space.

Another major change that will occur is the planned 10-screen Chunky’s theater that will occupy a significant portion of the former Lowe’s in Manchester. The former Lowe’s has been available since 2011. A number of closings in Southern New Hampshire during the past year resulted in an increase of 256,700 square feet of unoccupied space in the region, jumping the vacancy rate from 9.6% to 10.5%, about the level experienced in 2014. Two-thirds of the incremental gain can be attributed to the recent closing of four Sports Authority stores.

Size Classifications: Looking at vacancy rates by store size, it was not encouraging to see all categories less than 100,000 square feet showing a rise in vacancy rates between 2015 and 2016. However, the 50,0000-99,999 square foot segment was impacted by a reduction in vacant square footage in the 135,197 square foot Lowe’s vacancy (noted above), resulting from Chunky’s commitment to occupy a portion of this unit. Consequently, the 100,000-199,999 square foot classification now has less vacancy than last year. Not surprisingly, the vacancy rate in the 25,000-49,999 square foot bracket showed the sharpest rise with the four vacant Sports Authority stores included in this size range. Vacancy among smaller independent retailers continues to troublesome as both classifications less than 5,000 square feet have significantly higher vacancy rates this year versus last.

Regional Submarket Rankings: There has been no change in the top ten largest regional markets: Nashua continues to rank first with 6.3 million square feet of inventory; Manchester follows at 5.3 million square feet; and Salem is a distant third at 3.8 million square feet. Seabrook and Bedford follow with 2.0 million square feet and 1.6 million square feet, respectively.

Among towns with at least 500,000 square feet of retail space, Salem tops the rankings for lowest vacancy rate at 4.8%. Bedford, last year’s top-ranked community, dropped out of the top five as a result of the closing of a Hannaford store, which relocated to the former Stop & Shop in Bedford. Hudson is this year’s runner-up at 6.8%. Nashua, Derry, and Exeter complete the top five. Seabrook continues to have the highest vacancy rate in the region at 17.8%, although this figure will decline if the vacant Walmart store at Seacoast Shopping Center is acquired by Ocean State Job Lot, which has been reported. Manchester remains in second place and North Hampton moved up one spot to third.

Retailer Activity: Fitlab Fitness Club led the way in incremental space in Southern New Hampshire by acquiring and rebranding the five Gold’s Gym locations in Southern New Hampshire. A new Dick’s Sporting Goods store in Salem moved this retailer into second place. Walmart was third following a Manchester relocation of its traditional store to a supercenter prototype, netting 65,300 square feet of new retail space. Mattress Firm tied Fitlab Fitness Club for the most new store locations, both adding five units. No other retailer added more than two locations, Aldi and Orangetheory Fitness among these.  The demolition of Macy’s in Bedford caused this retailer to lose the most retail space in the region. The liquidation of Sports Authority placed this retailer in second place. Gold’s Gym was a distant third with all locations converting to Fitlab Fitness Club. Gold’s Gym was also the leader in the number of stores closed with five. Sports Authority was second with four stores and 7-Eleven followed with three units. The complete report contains more detailed information on these categories and more, and will be available soon at KeyPointpartners.com.

Bob Sheehan, Vice President of Research
BSheehan@KeyPointPartners.com

This KeyPoint Report examines changes in supply, vacancy and absorption, retailer activity, and market composition by store size and retail categories during the period from June 2015 to June 2016. The study area includes 39 cities and towns, representing more than 835 square miles and approximately 550,300 permanent residents (42% of the state population).  KeyPoint Partners’ GRIID™ database maintains detailed information on virtually all retail properties in three key regions: Eastern Massachusetts, Southern New Hampshire and Greater Hartford, Connecticut. These markets encompass approximately 44% of all retail space in New England. GRIID™ has information on approximately 263 million square feet of retail space and approximately 59,700 retail establishments. The KeyPoint Reports contain a summary and analysis of retail market trends and activity for each studied market area.

KEYPOINT PARTNERS COMPANY NEWS

New Leasing Assignments: Burlington Center Village, Burlington, MA, a new development on the site of the former Building #19 on Route 3A. Sr. Associate Michael Branton and VP of Leasing Rob Grady are handling the assignment. Shaw’s Disposition: The Leasing Team will lease multiple vacant former Shaw’s Supermarkets locations in New England, and sell a parcel of land in southern New Hampshire. Rob Grady, VP of Leasing Don Mace, and Sr. Leasing Associate Michael Branton will handle the assignments. The available spaces range in size from approximately 48,100 to 68,700 square feet. The parcel of land for sale consists of approximately 9.78 acres at the intersection of Route 107 & Route 101 in Raymond, New Hampshire. Complete information about these opportunities, including site plans, photos, and market information, can be found at KeyPointPartners.com (click on Shaw’s Disposition).

NATIONAL NEWS

US retail sales rose sharply in June, a sign consumers are spending at a healthy clip and propping up the economy after a slow start earlier in the year. Retail sales rose a seasonally adjusted 0.6% to mark the third straight strong gain.The surge in spending was led by home-and-garden centers and online stores. Sales at stores that sell building materials and garden supplies soared 3.9% to mark the biggest increase since 2010. These purchases accounted for about 42% of the total increase in retail sales last month. Gas stations and even department stores also recorded strong sales. Gas prices increased in the spring and early summer, though prices have since leveled off. Sales at apparel stores fell 1%, restaurants lost business and sales at purveyors of electronics and appliances were flat. Among retailers reporting monthly comp-store sales, L Brands was up 6.0%, Gap was up 2.0%, and Costco was flat See our sales reports below...Dick’s Sporting Goods was the victor at the bankruptcy auction for Sports Authority. Dick’s bid $15 million for the brand name and other intellectual property, beating Sports Direct International PLC’s $13 million bid. Dick’s also had the winning bid for 31 Sports Authority store leases, for an additional $8 million. The bids are subject to the approval of the US Bankruptcy Court.

ACCELERATING NEWS

Brookshire Grocery Co. will open 26 locations this summer under its new Spring Market banner. The stores will be on the sites of former Walmart Express stores that Brookshire is in the process of acquiring. The locations range from southern Louisiana to west Texas...Tesla has entered a partnership with Nordstrom department stores, and will open a “gallery” in Nordstrom at The Grove, Los Angeles. The 400 s/f display will feature a Model X electric crossover, and Tesla will offer test drives outside the store. The mini Tesla Store will remain open through the end of the year as a pilot...Amazon plans to open a third Amazon Books this fall, at Washington Square Mall just outside of Portland Oregon. Amazon debuted the concept in Seattle in November. It is scheduled to open a second location this summer, at Westfield UTC Mall, an open-air center near the University of California’s San Diego campus. Amazon Books is also slated to open in Hudson Yards, the planned retail, commercial and residential development in NYC. Hudson Yards stores are projected to open in late 2018 or early 2019....ALDI is expanding in New Jersey. The supermarket chain opened a store in Bloomfield, its 37th location in the state, and several more will open later this year. The company has more than 1,500 stores in 34 states, and plans to open about 130 new stores each year in the future...Ross Stores opened 8 new dd’s Discounts stores this month, bringing its total to near 190 units. Ross Stores operates 1,274 off-price apparel and home goods units in 34 states...Bridgestone Retail Operations LLC is looking to expand its retail reach, which currently includes 2,200 company-owned stores in 48 states, which operate under four brands: Firestone Complete Auto Care, Tires Plus, Hibdon Tires Plus, and Wheel Works. The company plans to get to 3,000-3,500 stores via new store openings, as well as acquisitions. Bridgestone is adding 25 new stores in 2016, probably 40 stores in 2017, and as many as 60 or 65 stores each year after that... PetSmart Inc. opened 12 net new stores for the quarter ending May 1, 2016. The company opened 50 net new stores in 2015 and expects to open approximately 80 in fiscal year 2016. PetSmart operates 1,466 stores in the US, Canada, and Puerto Rico...Barnes & Noble Inc. is set to unveil four concept stores in the next year that will feature restaurants serving alcohol. The chain, which owns 640 bookstores nationwide, aims to combat weak store traffic with expanded cafes serving beer and wine, as well as a full breakfast, lunch and dinner menu, with waiter service...Blaze Fast-Fire’d Pizza announced that its 150th restaurant is set to open next month in Houston, its fourth location in this Texas market, with restaurants now open in 31 states and development underway in 48 US markets. The company is planning to open an average of one new restaurant every four days, with its 500th location projected to open in about three years...Fast-casual seafood restaurant chain Slapfish has signed a multi-state franchise deal which will introduce the chain in Utah, Idaho, Arizona, Nevada, Colorado, and Texas... Kellogg’s will open Kellogg’s NYC, its first-ever permanent café, at 1600 Broadway this month. The café will serve dishes featuring Kellogg’s cereals available with an array of unique ingredients. Customers can customize their dishes by choosing from dozens of toppings. The café will have dine in or carry out options and there are plans to launch a delivery service later in the year...Fresh Thyme market opened its 40th store, the first in Omaha, last month. Two other Omaha stores will open shortly after the new year. Fresh Thyme plans to open 20 to 25 stores a year, for a total of 150 across the Midwest in the next four years, and may look to an initial public offering a few years down the road...Westfield Garden State Plaza is rebuilding one of its entrances and remodeling a prime corner of the Paramus mall to create a showcase space for luxury furniture seller Design Within Reach. DWR will move into a new 12,000 s/f store in October. Design Within Reach started as a catalog company and later began opening retail stores. The company has an outlet store in Secaucus and 3 stores in Manhattan... PGA Tour Superstore will open a 45,500 s/f store at Woodlands Shopping Center, Houston, in a former Sports Authority location, this fall. PGA Tour recently took over another Sports Authority location, in Glendale, AZ, which will open in 2017...Convenience store chain Sheetz is opening 4 stores this month in 4 different states: WV, NC, OH, and PA. Sheetz, operates more than 500 stores... uBreakiFix, which specializes in repair of small electronic such as smartphones, game consoles, tablets, and computer,  announced significant growth for the second quarter of 2016: a total of 27 new stores, 3 of which were in new markets for the brand. The company ended the second quarter with 212 locations across North America. Between July 1 and Sept 30, uBreakiFix plans to open 31 new stores in existing markets and new markets including Boston, and plans to have 275 corporate and franchise locations in operation by the end of 2016... Petco will open five new Petco stores across the country this month, and is remodeling 12 stores. Petco operates more than 1,430 Petco locations and more than 115 Unleashed by Petco locations...Delhaize Group and Ahold have reached agreements with buyers to divest 86 US stores. The companies’ merger is set for completion at the end of July, pending final approval by the FTC. The divested stores are in a limited number of locations in which the companies’ subsidiaries both operate, and represent 4.1% of the Ahold and Delhaize Group companies’ total combined US store count. When the merger is complete, Ahold Delhaize will operate some 6,500 stores.

DECELERATING NEWS

Uniqlo has quietly closed 5 stores since January amid slowing sales, all in US suburban shopping malls, one of which was open less than 3 years. Uniqlo has 1,700 global stores, 43 in the US. Owned by Fast Retailing, the company told investors last year that it would scale back US expansion after opening 17 stores in 2014. Last year it opened 4 new stores, and has announced that three stores will open this year... Apparel manufacturer VF Corp. entered a definitive agreement to sell its contemporary brands businesses to apparel company Delta Galil Industries Ltd for $120 million. Brands include 7 for All Mankind, Splendid, and Ella Moss, with the deal expected to close later this year.

NEW ENGLAND NEWS

The Fallon Co. has signed lease agreements with four new tenants for Boston’s Fan Pier development: Mastro’s Ocean Club, a seafood restaurant; Frank Anthony’s Gourmet Market, the neighborhood’s first food market; Sorelle, the Boston-based bakery café chain with locations in Charlestown and Fort Point; and Salon Mario Russo...New Balance Athletics opened its first US flagship store at Boston Landing, a 15-acre mixed-use project on the Allston-Brighton border that’s home to the New Balance world headquarters.

Tuesday, July 19, 2016

MAY RETAIL SALES REPORT



























Notes: figures gathered from individual company websites, press releases, and Federal filings.  Not all companies report all figures; results not reported will be marked “n/r”. Quarterly results will be updated when available; quarterly figures are shown in italics. Figures from companies not calculated to one decimal point automatically received an ending digit of 0. 

COMMERCE DEPARTMENT MONTHLY SALES

Retail sales rose strongly in June as Americans bought more vehicles and other goods, the Commerce Department said. Retail sales rose 0.6% last month after gaining 0.2% in May, the third consecutive month of increases, and it lifted sales 2.7% from a year ago.

Source: U.S. Department of Commerce - commerce.gov

TREASURY YIELDS

















Treasury Yield Sources:  federalreserve.gov; ustreas.gov

CONSUMER CONFIDENCE INDEX

The Conference Board Consumer Confidence Index®, which had decreased in May, improved in June. The Index now stands at 98.0 (1985=100), up from 92.4 in May. The Present Situation Index increased from 113.2 to 118.3, while the Expectations Index rose from 78.5 to 84.5 in June.

Source: The Conference Board - www.conference-board.org

PURCHASING MANAGERS INDEX

Manufacturing expanded in June as the PMI® registered 53.2 percent, an increase of 1.9 percentage points from the May reading of 51.3 percent, indicating growth in manufacturing for the fourth consecutive month, and is the highest reading since February 2015 when the PMI registered 53.3 percent. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

Source: Institute for Supply Management - Manufacturing Report on Business - www.ism.ws