As retailers slug it out for market share and the attention of distracted consumers, landlords are taking full advantage of the limited amount of space in A and B malls. “The vacancy rates have really narrowed,” said Andrew Graiser, copresident of A&G Realty Partners, a real estate advisory firm. “You’re in a world right now where there’s little to no growth in new developments outside of outlets. There are a lot of retailers that are growing, they have no place to grow, so therefore there’s a lot more demand for A- and B-quality retail. The rents are going up.” All of that is good news for the real estate investment trusts. “It’s clearly their time,” Graiser said. “Where four or five years ago the retailers had a lot of leverage in the A and B malls, that has definitely swung to the landlords.”RELATED STORY: ICSC Preview: Remaking Malls in an Internet Era >> Graiser noted that REITs are focused on improving their best real estate, and in some cases are selling off their C and D malls to smaller players or private companies that can dig in and reinvent the spaces. General Growth Properties Inc., for one, is laser-focused on the high end of its portfolio. Sandeep Mathrani, chief executive officer, recently told Wall Street analysts, “We firmly believe that good things happen to good assets, and over the long term, the most opportunity and highest value creation opportunity will be within the high-quality end of the property spectrum. Our mission is to own and operate high-quality retail assets in the U.S.” Of General Growth’s 123 malls, 73 are considered A malls, and they account for three-quarters of the company’s net operating income and see sales of more than $650 a square foot. Overall, the company saw a permanent occupancy rate of 90.1 percent at the end of the third quarter. And the net operating incomes at malls don’t necessarily move in lockstep with the retail market as a whole. “We see almost no or very little correlation between tenant sales growth and our NOI growth,” said David Simon, chairman and ceo of Simon Property Group Inc., on a call with investors. “Due to our ability to replace underperforming retailers, we have good visibility for strong NOI growth over the near term.” Simon’s comparable property net operating income in its U.S. malls and premium outlets rose 4.9 percent in the third quarter. And the firm’s occupancy rate stood at 95.5 percent with total sales per square foot of $579.
To celebrate Pride 2018, @themarcjacobs released the #GratefulNotHateful campaign, a social media initiative aimed at extending Pride beyond the parade. Inspired by Jacobs’ everyday outlook, the campaign features Jacobs along with a group of models and social media stars who are members and supporters of the LGBT community, all seen wearing @marcbeauty’s Highliner Gel Eye Crayons in colors of the rainbow. Head to our Instagram stories to see close-ups of the liner. #wwdbeauty
Virgil Abloh’s dad Nee and Don Crawley, cofounder of RSVP Gallery, were some of the hometown crew at the Chicago-born designer’s debut show for Louis Vuitton. (📸: @jdiderich ) #wwdmens #louisvuitton #virgilabloh
About last night: @marycharteris and @adwoaaboah hit up Hyde Park for the Serpentine Galleries’ annual summer party held in partnership with @chanelofficial. Head to WWD.com to see more photos. #wwdfashion
“This is Paris, my first show. I’m all about democracy. If some kid shows up, flew from New Jersey to just be around, let’s get him a seat.” — @virgilabloh tells WWD’s @jdiderich ahead of his first show for @louisvuitton men’s. (📸: @alfredo_piola ) #wwdmens #virgilabloh #louisvuitton
“Kate Spade was a true fashion icon who brought joy to the lives of women around the world, and inspired women to live life to the fullest. We are dedicated to carrying on her legacy,” said Anna Bakst, brand president and chief executive officer of @katespadeny. The Kate Spade Foundation announced that it will be donating $1 million to suicide prevention and mental health awareness in tribute to the recent death of Kate Spade. Read more on WWD.com. #wwdnews (📷: @chinseephoto)
A first look at @virgilabloh’s sneakers for @louisvuitton. Abloh spoke to WWD about his debut collection for Louis Vuitton, creating @kendalljenner’s #metgala outfit and redefining the heritage brand. Read the full story on WWD.com. #wwdfashion 📷: @alfredo_piola)
The world’s largest producer of denim @iskodenim is sharing the strategy behind its product development process. Read our full interview with ISKO’s product development manager Baris Ozden on the company’s extensive research practices, upcoming denim trends and the latest material innovations on WWD.com. #iskodenim