When our heavily indebtied consumers retreat, are we going to see massive vacant space here in NZ soon?
Source: http://www.nzherald.co.nz/commercial...ectid=10556014
Circuit City will finally flicker out when its last 567 stores close this year, but the bankruptcy of America's second-largest electronics retailer will ripple across the US economy for years.
In its wake will be 18.71 million square feet (1.74 million sq. meters) of vacant space in a faltering real estate market. More than 40,000 workers will be jobless, including 7,000 laid off last year.
In its wake will be 18.71 million square feet (1.74 million sq. meters) of vacant space in a faltering real estate market. More than 40,000 workers will be jobless, including 7,000 laid off last year.
The vacant stores leave a huge hole for shopping centre owners to plug.
Finding new tenants is increasingly difficult, as chains like Linens 'N Things, Mervyns and Steve & Barry's also go out of business. Other companies such as Starbucks and Ann Taylor are retrenching from an era of swift expansion.
Making matters more difficult is the size of most Circuit City stores, which range from nearly 17,000 square feet (1,579 sq. meters) in Steubenville, Ohio, to more than 66,000 square feet (6,131 sq. meters) in El Paso, Texas. Very few retail tenants require such large spaces, said Green Street Advisors analyst Nick Vedder.
"The anchors are really one of the most important pieces of the center," Vedder said. "They bring in the traffic, they are the lifeblood that (other) tenants rely on to bring customers to the stores."
Analysts say most landlords can expect to see weak to no rent growth this year and higher retail vacancy rates. Those factors could push many owners of shopping malls, office towers, apartment buildings and industrial buildings into foreclosure or bankruptcy.
Finding new tenants is increasingly difficult, as chains like Linens 'N Things, Mervyns and Steve & Barry's also go out of business. Other companies such as Starbucks and Ann Taylor are retrenching from an era of swift expansion.
Making matters more difficult is the size of most Circuit City stores, which range from nearly 17,000 square feet (1,579 sq. meters) in Steubenville, Ohio, to more than 66,000 square feet (6,131 sq. meters) in El Paso, Texas. Very few retail tenants require such large spaces, said Green Street Advisors analyst Nick Vedder.
"The anchors are really one of the most important pieces of the center," Vedder said. "They bring in the traffic, they are the lifeblood that (other) tenants rely on to bring customers to the stores."
Analysts say most landlords can expect to see weak to no rent growth this year and higher retail vacancy rates. Those factors could push many owners of shopping malls, office towers, apartment buildings and industrial buildings into foreclosure or bankruptcy.
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