3 Reasons The Retail Decline is a Myth
Rumor is out: retail is on the decline nation-wide, indeed all you need is to do a web search on the traditional big-box retailers (cough we’re looking at you Sports Authority cough). Walmart reported a disappointing holiday season at the close of 2015, and Macy’s announced large moves to downsize its stores. Everywhere you look it seems traditionally large anchors are declaring bankruptcy or announcing plans to “tighten their belts” (Forbes: Macy’s Downsizing is a Warning. Jan 7, 2016). Armchair economists are leaning back and claiming it’s all e-commerce and millennials that are responsible for the change in retail climate. But here at Permit Advisors we look at how the numbers ebb and we say flow is in the future and the retail decline is a myth. Here are three things the industry is forgetting:
- E-commerce is looking for small brick and mortar concepts. Yes, e-commerce has had an effect on shopping. Millennials, who half a decade ago earned the nickname “Boomerang Kids,” are now moving out. With swelling education debt and housing costs, they are turning to e-commerce for less expensive items. Yet Amazon has announced it will open small shops to act as shipping hubs and has even opened up the first such location in Purdue, Indiana (Smith: Amazon Opens It’s First Store. Feb 4, 2015). Google has already begun a competitive move to compete with Amazon on these fronts which tells us that cyber retail competition is about to go IRL (in real life).
- Vacancies in Open-Air Malls is low. Cushman and Wakefield revealed the fourth quarter of 2015 continued to have the lowest vacancy rates for the “fifteenth consecutive quarter” for open-air centers (ICSC: Demand Keeps…Vacancies Low. Feb 17, 2016). With vacancy rates dropping to under ten percent what does this mean? It means that while large retailers are downsizing, they are still sizing. Put another way, retailers aren’t going anywhere anytime soon. Macy’s is a good example of a large retailer that is reorganizing its structure but is not going anywhere. It understands that consumers, of any age, still enjoy shopping and that the brand still has a viable concept for them. Target, Best Buy, and even Walmart are also downsizing and reorganizing while remaining in shopping centers.
- Mixed-Use Developments are on the Rise. For the last two years, everyone has been going back and forth on mixed-use concepts. But the numbers are in: mixed-use is on the rise (Thrall, Grant. Business Geography and New Real Estate Market Analysis.2002, Oxford University Press. Page 216 http://www.thrall.us/). This does not mean retail is on the decline it means retailers are getting smart. They know millennials want to live, work, work-out, eat and shop within walking distance. The generation raised on Captain Planet cares deeply about sustainability so will opt out of driving whenever possible, not to mention new and creative government taxes on gas, miles traveled, or any other pilot government programs.
While on the surface retail does appear to be on the decline, a closer look finds that it’s not declining but adapting to new consumers and technology. But why is Permit Advisors, a permit expediting company, sharing this information? We are a government liaison team pushing project approvals up to two weeks ahead of schedule nation-wide for crying out loud! We keep up-to-date information about codes, plans, permit fees, and schedules, as well as what is happening in our industry is why. We are the premiere expediting firm in the US and care about what you care about.
About Permit Advisors: Permit Advisors Inc. is a complete permit, entitlement consulting, and expediting firm based out of Beverly Hills, CA. We go beyond just submitting plans, as you may have experienced with previous expediters. We have established strong relationships with officials of many municipalitieRes and have numerous time and cost saving strategies that we implement to efficiently complete projects. We aim to secure all permits as quickly as possible! We keep track of all the different aspects of the permitting process and make sure that the project is being given full attention by everyone on the team. We responsibly update clients and ensure that lines of communication are open between the Jurisdiction, the consultants and the client at all times. Contact us today for a consultation www.permitadvisors.com.