Wednesday, August 19, 2015

Greater Hartford, CT Retail Report Preview

With the releases of The KeyPoint Reports on Eastern Massachusetts /Greater Boston and Southern New Hampshire behind us, it’s time to move on to the report for Greater Hartford, Connecticut, based on our proprietary GRIID™ retail database. As with the other reports, our modus operandi is to share some of the regional highlights while the complete version is still “baking”. In Greater Hartford, the 2015 retail market traveled further down the road to stability:

Retail Inventory and Vacancy: Total retail space in Greater Hartford currently totals 37.2 million square feet, a nominal increase of only 17,000 square feet from last year. In today’s environment, limiting new development should be regarded as a good thing. Much of the existing vacancy needs to be filled or demolished before any substantial new retail space can be added to the region, and the region took considerable strides this year toward accomplishing just that. Total occupancy increased by more than 350,000 square feet in 2015, lowering the vacancy rate in Greater Hartford from 11.0% in 2014 to 10.1% this year.

Size Classifications: Although the market experienced a substantial decline in vacancy last year, it was one size classification in particular that deserves most of the credit. The 25,000-49,999 square foot bracket dropped from 12.2% all the way down to 6.7%, one of the largest declines ever reported. Grossman’s Bargain Outlet now occupies part of a vacant Big Y in East Hartford, Harbor Freight replaced a portion of a former A&P space in Berlin, and Goodwill took part of a space previously occupied by TJ Maxx in Avon, all of which contributed to the improvement in this size classification. In addition, Edge Fitness will be opening in the former Border’s space in Manchester and Hartford Health Care will replace a vacant A&P in Vernon, both expected to open this fall. The 50,000-99,999 square foot classification also showed significant improvement, lowering its vacancy rate from 7.9% to 6.8%. The primary contributor was Ocean State Job Lot, which now occupies most of the space left behind by the A&P at Webster Square in Berlin. Ocean State closed its smaller store in the same shopping center. The only category to end the year with higher vacancy was the 5,000-9,999 square foot store segment, with some of the fallout coming from closings of Pier 1 in Manchester, Salvation Army in Vernon, Family Dollar in New Britain, and True Value Hardware in Avon.

Town Rankings: The top ten among Greater Hartford towns, based on square feet of retail space supply, remained the same as in 2014, with only one shift in the rankings: Farmington inched ahead of East Hartford into sixth place this year. It should be no surprise that the top three towns are Manchester, West Hartford, and Enfield, all regional retail hubs serving Greater Hartford. Manchester dominates the region with 5.4 million square feet of retail space; West Hartford comes in a distant second with 2.9 million square feet. However, it should be noted that the 1.3 million square foot Westfarms regional mall, which straddles the West Hartford/Farmington line, has a Farmington address but is very much rooted in the West Hartford retail hub. Consequently, West Hartford is effectively a 4.0 million square foot market. In terms of vacancy rates, lowest vacancy was found in West Hartford, Rocky Hill, and Newington, all under 5.0%. Last year only Rocky Hill was under that threshold. Farmington and Plainville complete the top five. Among towns with the highest vacancy rates, three towns remain above the 20% level, including East Windsor, East Hartford, and New Britain. Berlin was also above 20% last year but improved to 17.1%, but is still ranked fourth, followed by South Windsor.

Retailer Activity: Fallas, a family-owned clothing retailer, acquired Conway Stores last year and as a result now operates the former CW Price store in Wethersfield. This 39,280 square foot unit represents the most retail space added to the region by any retailer. Dave & Buster’s opened last year in Manchester and is ranked second. Close behind is Grossman’s Bargain Outlet in East Hartford, which now shares a former Big Y unit with Cardio Express. With respect to store additions, there was not much to get excited about in Greater Hartford. The leader in the region was Subway, opening only four new locations. A couple of retailers added two stores, including Menchie’s Yogurt and AT&T Wireless.

Conversely, the aforementioned Fallas acquisition resulted in CW Price leading all retailers in space contraction. Mill Stores followed, closing its only store in the region in Manchester. Digiplex Cinemas sold its one unit to Carmike, ending the year in third place. Only three retailers closed two or more stores in the region. Radio Shack led the way with six units, followed by Verizon Wireless with three stores and OneMain Financial with two branches.

The KeyPoint Report examines the retail real estate marketplace for Greater Hartford, Connecticut, with a focus on changes between August 2014 and July 2015. This report provides an analysis of changes in the region's retail activity and examines supply, vacancy and absorption, retailer activity, and market composition by store size and retail categories. The Greater Hartford market includes 26 cities and towns and represents more than 835 square miles. The complete report contains much more detailed information on these categories and more, and will be available soon at

Bob Sheehan, Vice President of Research

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 nearly 260 million square feet of retail space and approximately 60,000 retail establishments. The KeyPoint Reports contain a summary and analysis of market trends and activity for each studied area.The KeyPoint Report for Eastern Massachusetts/Greater Boston and The KeyPoint Report for Southern New Hampshire have been released, and are available at

KeyPoint Company News

New Leasing Business: 38 Shops at 5 Way, Plymouth, MA, and 18,044 s/f space adjacent to The Grove at Plymouth. VP of Leasing Rob Grady and Sr. Associate Michael Branton are handling the assignment. New Employee: Gaudy Hernandez has joined the Boston Office as an Assistant Property Manager. Gaudy has property management experience at SHP Management Co. in Boston.

National Retail News

Retail sales rose 0.6% in July month, according to the US Commerce Department. Excluding sales of automobiles, sales were up 0.4%. Eleven of 13 major categories showed increases. One of the best performing categories was non-store retailers, which includes online merchants, where sales rose 1.5%. Sales rose 0.9% at sporting goods stores; 0.8% at home and furniture stores; 0.7% at building materials stores; and 0.4% at apparel stores. At restaurants, sales were up 0.7%. Department stores and general-merchandise retailers did not fare so well, both registering a 0.5% decline. Electronics and appliance sales fell 1.2%. The Commerce Department also revised June's 0.3% decline in retail sales to an unchanged reading. Among retailers reporting monthly comp-store sales, L Brands was up 3%, Gap was down 3.0%, Rite Aid was up 2.4%, and Costco was up 3%. See our sales reports below...Macy's will offer same-day delivery in 8 new cities, including Boston. Macy's is teaming with Deliv to offer the service beginning this month in an effort to compete with e-commerce retailers like Amazon. The company tested out same-day delivery in 8 markets last fall.

Accelerating Retail News

Cabela’s plans to open 4 stores in the third quarter of fiscal 2015 and 2 stores in the fourth quarter. In addition, Cabela’s expects construction on an 82,000 s/f store in Summerville, South Carolina to begin in 2015, and anticipates a fall 2016 opening....The Limited Too brand is about to be revived. Bluestar Alliance has purchased the trademarks for the tween girl retail brand from Sun Capital Partners, the private-equity firm that owns The Limited. Limited Too was once part of L Brands, then was spun out under the name Tween Brands. In 2008, Tween Brands dumped the Limited Too name and rebranded the stores with its Justice name. The new brand will be sold in a mixed-distribution model, in department stores, in shops-within-shops, in stand-alone retail locations and online...Bluemercury Inc. is getting ready to open three new Washington-area stores this fall, part of a planned national expansion. Bluemercury will also open a location in the Brentwood section of Los Angeles this month, bringing the number of stores to 67, with a planned 79 by the end of the year...Whole Foods Market will debut its new value-driven format, 365 by Whole Foods Market, in the second half of next year, with the first store opening Los Angles. It plans to open up to five 365 stores (all in the second half of next year), with the expectation of doubling the number of openings in 2017. Stores will average about 30,000 s/f. Whole Foods currently has 424 stores. It expects to cross the 500-store mark in fiscal 2017. Longer term, the company sees demand for more than 1,200 Whole Foods Market stores in the US...Rita’s Italian Ice will enter the convenience and gas channel nationwide with area development agreements awarded to M&M ARC Inc. for the West and to Ice & Go LLC for the Midwest, South, and Northeast. Together, the two agreements call for 60 units by 2025. Rita’s has been aggressively expanding across the US...H&M is expanding its higher-end brand, COS (Collection of Style). The retailer plans to open 4 stores in the US in 2015. COS is also expanding into Canada, with stores set to open in Montreal and Toronto. COS entered the US last year with 2 locations (in Los Angeles and New York City).  COS has 125 stores in 26 countries...Lowe’s will open a 30,000 s/f store on the corner of Broadway and 68th Street. The location is a quarter the size of its suburban stores and is the company’s first Manhattan store...Domino's Pizza opened its 12,000th store in the world this month, in Oklahoma City...L.L.Bean is opening its first Kansas store in November of 2015, its 26th full retail store outside of Maine...Lumber Liquidators, struggling with possible legal action stemming from the sale of Chinese hardwood flooring that allegedly contained excessive levels of formaldehyde, still anticipates opening 20- 25 new stores in the expanded showroom format, and remodeling 10-15 existing stores in the expanded showroom format, by the end of the fiscal year...Chick-fil-A will open its largest location to date in in New York City, a three-story, 5,000 s/f restaurant. The new Chick-fil-A will be one of the few quick-service restaurants in New York City built to LEED standards with water and energy efficiency features, air quality control and waste diversion efforts, among other initiatives...Aldi plans to open more than 600 stores and create 10,000 new jobs by the end of 2018. The grocery chain is accelerating expansion, with plans to open 130 new locations a year, up from 80, and a  goal of nearly 2,000 US stores...DSW is opening 22 stores, including six locations in new markets, nationwide from August to November. DSW operates 449 stores in 42 states. ..Stein Mart will open 9 stores this fall, and at least 12 new locations in 2016. Stein Mart operates 269 stores...Party City will open 30 new stores for 2015 and complete 50-60 remodels and relocations...Dick’s Sporting Goods Inc. plans to open 44 new Dick’s Sporting Goods stores and 9 new Field & Stream stores, as well as relocate five Dick’s Sporting Goods stores and one Golf Galaxy store, during fiscal 2015...Japanese fast-casual dining chain Jinya Ramen Bar expects to add an additional nine US franchise locations in key cities. Currently, there are 14 locations throughout Japan, the US, Canada and Indonesia.

Decelerating Retail News

Fresh & Easy will close 14 stores in southern CA and other areas as it continues to downsize. This follows the closing of 55 Fresh & Easy stores in 3 states earlier in 2015...Barnes & Noble Inc. has completed the separation of its retail store and college businesses. Barnes & Noble Education Inc. is now an independent public company and the parent of Barnes & Noble College...Advance Auto will be closing 50 stores before the end of the year in markets across the US. The company operates 5,369 stores across the US and Canada, of which about 1,060 still operate under the Carquest brand name.

New England Retail News

Hannaford’s first new small store concept will open this month in North Berwick, Maine. The 20,000 s/f store is less than half the size of a typical Hannaford...Japanese clothing retailer Uniqlo will open a new, permanent store at Boston’s Faneuil Hall Marketplace this October. The 12,000 s/f store will span two levels. The retailer has been operating a pop-up store at Faneuil Hall since last year. ..Bed Bath & Beyond, Michaels, and DSW have all agreed to sign leases for between 15,000 and 20,000 s/f spaces at the new Guilford (CT) Commons, scheduled to open this fall. They join Fresh Market, which had already been announced as an anchor...Smoothie King plans to expand in Greater Boston by opening up to 53 locations in the next six years. Smoothie King has an existing location on Newbury St., but would like to expand in Boston, Brookline, Cambridge, Somerville, Medford, Waltham, Newton and Brighton.. Smoothie King was founded in 1973 and has grown to 735 locations in 33 states and worldwide. Smoothie King is on pace to open up to 100 locations this year...Simon announced plans for a major renovation to the retail portion of Boston’s Copley Place to begin in September and include interior and exterior enhancements. Simon will add a number of luxury retailers to the property. The majority of the project will be completed by the summer of 2016 with Copley Place remaining open throughout the renovation..Redstone American Grill opened in the 3rd Avenue retail market district in Burlington, MA, the eighth in the chain and the first in Massachusetts...H&M will open a new location at the Natick Mall in the fall. The company opened 379 stores in 2014 and intends to open 400 more this year. It has 11 MA stores.

July 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 0.6% in July month, according to the US Commerce Department. Excluding sales of automobiles, sales were up 0.4%. Eleven of 13 major categories showed increases. The Commerce Department also revised June's 0.3% decline in retail sales to an unchanged reading.

Source: U.S. Department of Commerce -

Treasury Yields

Treasury Yield Sources:;

Consumer Confidence Index

The Conference Board Consumer Confidence Index®, which had improved in June, declined in July. The Index now stands at 90.9 (1985=100), down from 99.8 in June. The Present Situation Index decreased moderately from 110.3 last month to 107.4 in July, while the Expectations Index declined sharply to 79.9 from 92.8 in June.

Source: The Conference Board -

Purchasing Managers Index

Manufacturing expanded in July as the PMI® registered 52.7 percent, a decrease of 0.8 percentage point below the June reading of 53.5 percent, indicating growth in manufacturing for the 31st consecutive month. 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 -