NEW YORK — Are brick-and-mortar stores inching back into expansion mode?
Traditional retailers have taken something of a beating over the last few years, battered by everything from the recession and the newly frugal masses to the growing popularity of e-commerce and mobile commerce. The downbeat economy caused many companies to rein in the opening of new stores following a boom in the early part of the Aughts that in some cases saw retailers add up to 100 units and more a year.
Now there are faint signs of a retail recovery — although still far from the glory days of yore. Lord & Taylor’s plan to open its first new full-price store in 30 years, in Yonkers, N.Y., bodes well for the industry. Other positive indicators include the dearth of available space for pop-up shops — a recession-era phenomenon that gave retailers the flexibility to rent month-to-month — due to more permanent leases being signed.
But for every upbeat trend there are caveats — accommodations to the postrecession economy and reminders that the free-spending days are still a thing of the past. For example, on the prime stretch of Madison Avenue last year there were 15 available stores. All were leased this year, albeit at lower rents. Retailers may be opening stores, but many of them are smaller than in the past, or existing stores are being carved up and downsized. Saks Inc. has shuttered underperforming units, while Charming Shoppes Inc. this year plans to close 100 to 120 Lane Bryant, Fashion Bug and Catherines units; The Jones Group said it would shut 165 stores, and Foot Locker Inc. closed 106 underproductive units after shuttering 179 in 2009.
Nonetheless, the mood at last week’s International Council of Shopping Centers Meeting and Deal Making here was upbeat — a far cry from the grim confab two years ago at the height of the recession. Retailers, who were noticeably absent during the last two ICSC conferences when they stayed away or held meetings in private, crowded the walkways between booths at the Hilton New York and Sheraton Hotel and Towers.
Glen Senk, chief executive officer of Urban Outfitters Inc., said the company is looking for real estate for all of its concepts. “The Urban brands are less than 50 percent penetrated with store locations in the USA,” he said, referring collectively to Urban Outfitters, Anthropologie, Free People, Leifsdottir and Terrain.
Nike in August launched a retail concept referred to as the New Generation store. Four units have been unveiled so far, and the company plans to open more, said Giovanni Scotti, director of real estate at Nike Inc. In addition, Converse, a wholly owned subsidiary of Nike, recently introduced its first store in Boston, followed by the Black Friday debut of a 7,000-square-foot flagship in SoHo here.
“We plan for five or six stores in 2011, on the street and in malls,” said Dave Powers, vice president of global retail. “[Ultimately], we could have a pretty sizable number. We plan to invest in retail and go forward with the U.S. rollout.”
Ken Mandelbaum, chairman and ceo of Big M Inc., which operates 117-unit Mandee and Annie Sez, said the company is ready to expand Afaze, its mall-based accessories chain for women in their 20s.
Lower-priced chains are apparently rebounding in this economy. Conway, the discounter known for huge bins of clothing sold at bargain-basement prices, is “looking for stores left and right,” said Benjamin Fox, a broker at Winick Realty.
There also has been an influx of international retailers to the U.S., said William Taubman, chief operating officer of Taubman Centers Inc. “Zara, H&M and All Saints continue to expand,” he said. Sources said Aritzia, a Vancouver import that features fashion, denim and accessories from labels such as A Moveable Feast, Cheap Monday and Earnest Sewn, is said to be opening a unit on Broadway and Prince Street in SoHo.
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