Hurricane Irma, downgraded to a tropical storm on Monday, hit Georgia, Alabama and the Carolinas even as retailers in Florida hoped to begin reopening some of their shuttered stores on Tuesday.
One of the most powerful storms in U.S. history, Hurricane Irma inflicted damage across Florida, although in some cases not as severe as originally feared. Irma’s effects on the economy still have to be calculated, but retailers are projected to be impacted to the tune of $2.8 billion in lost sales.
“Our Florida stores have been closed,” said a Bloomingdale’s spokeswoman. “They remain closed today and we are targeting normal business hours tomorrow for most stores.”
A Target Corp. spokeswoman said 123 stores and four distribution facilities are closed across Florida, Georgia, Alabama and South Carolina. “The list of stores is being updated by the Target team and will continue to be updated as Target assesses the situation,” she said. “Target is working to reopen stores as quickly as possible.”
“We expect to start reopening tomorrow select Saks Fifth Avenue, Saks Off 5th and Lord & Taylor stores in the impacted area that were closed, and will continue to reopen stores as conditions allow,” a spokeswoman for the retailer said. “We’re focused on ensuring our associates in the impacted area are safe.”
A message recording on Stein Mart’s customer service center said, “With the approach of Hurricane Irma, for the safety of our customers and associates, our corporate office and customer service center are unable to take your call. Due to the severity of the storm our offices may be closed until Tuesday.”
“Our centers were minimally impacted with only light external signage and landscaping damage,” a spokeswoman for Taubman Centers said Monday. “The Mall of San Juan reopened on Saturday, and we anticipate all of our centers in Florida will reopen tomorrow, including Dolphin Mall in Miami, International Plaza in Tampa, and the Mall at University Town Center in Sarasota.”
Bal Harbour Shops is closed today,” a spokeswoman said. “All of the barrier island remains closed to everyone, including residents. I’m not sure when that will lift.”
With retail stores closed Thursday and still closed today, Lincoln Road, Bayside and Design District, I’m sure had a very very bad week, but I don’t think it’s going to push the needle on retail. Bal Harbour’s got this great foliage and open air nature to it, but it’s still pretty enclosed. They probably had minimal damage, just loss of power from the wind, and that’s an easy fix,” said Zach Winkler, senior vice president and retail lead for South Florida at JLL, who lives in Coconut Grove, Fla. “We don’t have power. All we’re able to see is what’s on our phones. I live in one of the ‘A’ evacuation areas, and most people didn’t leave. The one restaurant and bar that’s open, Flannigan’s, is absolutely packed.
“Aventura mall definitely benefits from tourism,” Winkler added. “Tourism is still going to come back. September is the slowest month of the year for us. Partly because it’s hot, but it’s hurricane season. Early November is high season for tourism. Such a big storm and forecast hasn’t been predicted to hit squarely over Miami for a long time.”
Neiman Marcus on Monday said eight stores remained closed, including locations in Bal Harbour, Fort Lauderdale, Coral Gables, Tampa Bay, Orlando and Atlanta. Three Last Call units and a distribution center were also shuttered. A spokeswoman said the retailer, in response to Hurricane Irma, is renewing its commitment as a National Disaster Relief partner with a $250,000 donation to the American Red Cross.
While Fitch Ratings said it has yet to quantify the total economic impact of Irma and the earlier Hurricane Harvey that hit Texas, or which retailers present in the areas will be most hit, its head consumer and retail analyst Monica Aggarwal, said stores’ profitability may only take “a short term hit” from temporary closures.
“If any stores see damage, the retailers may create a reserve to account for these losses until they see some insurance proceeds,” Aggarwal added. “Some retailers — grocers, gas stations, home improvement — may see a short-term lift as customers stock up on supplies, gas and home improvement help in the clean-up effort. Retailers will try to isolate the impact as they report quarterly earnings and the market will treat it as a one-time impact.”
In a report last week on Harvey, Moody’s Investor Service said it is “still too early to assess the full extent of the fallout” for retail, but it noted the event could prove “credit positive” for home improvement stores, supermarkets, drugstores and dollar stores.
Craig Johnson, president of research firm Customer Growth Partners, said it’s “a bit too early” to parse out the financial and sales impact that Irma has had on retailers, but he is confident that “merchandise retail sales will bounce back sharply after power is restored.” Wal-Mart, Target and Costco will be among the biggest beneficiaries of the return, according to Johnson.
“Department stores and malls will reopen as soon as power is back and cleanup is completed, but [those] customers may take a bit longer to come back than at ‘essential’ stores, such as Home Depot, Lowe’s [and] CVS,” he added. “All told, although Irma was the biggest blow to Florida since Andrew, retail will bounce back as soon as power is restored.”
Because of Irma’s size — the monster hurricane was 400 miles wide — about six million people were affected in some way. Irma overtaxed Florida’s shelters. In Naples, the city was overwhelmed by the nearly 17,000 people who showed up, while throughout the state, more than 75,000 people rushed to shelters.
About two million homes across the state remained without power as of Monday afternoon as the diminished storm crept up the west coast of the state. Irma hit South Florida on Sunday morning as a dangerous category four storm and tracked northwest toward Tampa. The eye of the storm traveled over Naples, which was hit hard. Its reverberations were felt in Orlando, where Disney World was closed for several days, and as far west as Tallahassee. In Atlanta, there were traffic jams on the highways due to fleeing Floridians, and ports in the Carolinas redirected ships more than 500 tons.
Miami was in Irma’s sights when the storm began in the Caribbean. The city averted a direct hit, but didn’t escape the hurricane’s wrath unscathed. The city was for all intents and purposes shut down on Sunday, when two cranes in the downtown area