Retail bankruptcies and store closures have become a fact of life as chains struggle to survive in the age of Amazon. While some experts have questioned whether shopping centers and the retailers that populate them will survive, Garrick Brown, vice president of retail research at Cushman & Wakefield, Americas, has a different take.

During Tuesday’s webcast “Retail Armageddon…Not So Fast,” Brown said that an overstored marketplace, acceleration of e-commerce and failure to connect with Millennial consumers are among the factors contributing to retailers’ challenges.

“The closure news is coming fast and furious,” Brown said. “Payless is closing 400 stores and then it may go into bankruptcy. The reality is that today, if you go into bankruptcy, you’re probably not coming out.”

Brown cited a report by Credit Suisse, which estimated 8,600 store closures. “Wall Street wants to see 30 percent of department stores go away,” Brown said. “Macy’s has to close another 100 stores and J.C. Penney, about 140 stores.”

Retailers on the “watch list” for potential bankruptcy filings include: Bon-Ton Stores Inc., Gymboree Corp., Nine West, True Religion, Toms, Claire’s and Fossil.

Brown said the range of retailers that have succumbed to the brutally competitive environment includes Bebe, BCBG Max Azria, The Limited, American Apparel, Wet Seal, Rue 21, Lucy, Eastern Mountain Sports, among others.

Brown predicted “5,000 to 6,000 closures coming our way this year. The more distressing thing is that we’re at the same place we were during the great recession, even though wage growth continues to accelerate and unemployment is down.”

“Green Street Advisors is saying 800 department stores need to close before we can return to pre-recession productivity levels,” Brown said.

According to Moody’s 2017 is expected to have the highest rate of store closures since 2010. Comparing Moody’s retail portfolio distress rate of 13.5 percent this year to the Great Recession’s 16 percent, the industry will likely see more suffering if things continue along this trajectory.

Compared with other countries, the U.S. is greatly overstored and over-malled with 22.9 square feet of retail space per capita. Canada follows with 13.1 square feet; Australia, 6.4; the U.K. and Japan, tied at 3.2; France, 2.3, and Spain, 2.1.

Mergers and acquisitions activity is “going through the roof,” Brown said. “Lots of players are flush with cash and retailers are distressed, willing to sell themselves. Private equity is looking for new concepts.” Brands reportedly up for sale include Jimmy Choo, Bonobos, for which a deal is said to be in the works with Wal-Mart Stores Inc. and the Rite Aid-Walgreens merger.

Regarding Amazon, “Jeff Bezos has radically changed the game for everyone,” Brown said, noting that online sales are expected to reach 10.8 percent of total domestic sales in 2020, from the roughly 9.5 percent share now.

Amazon Inc.’s market cap, $398 billion, is more than the values of the next eight retailers combined, including Sears Holdings Corp., $1.1 billion; J.C. Penney Co. Inc., $2.6 billion; Nordstrom Inc., $8.3 billion; Kohl’s Corp., $8.8 billion; Macy’s Inc., $11 billion; Best Buy, $13.2 billion; Target Corp., $40.6 billion, and Wal-Mart Stores Inc., $212.4 billion.

E-commerce penetration for general merchandise, apparel, furniture and other, is hovering around 29 or 30 percent. “If you’re not doing a third of your sales online, you’re behind the curve,” Brown said.

Amazon’s 2016 revenue of $136 billion increased 27 percent over the previous year. Its revenue has been rising since 2013, when it was ahead 21.9 percent; 19.5 in 2014, and 20.2 percent in 2015. The digital retailer sold $94.7 billion of its own product, a 19.4 percent increase over the previous year. And Amazon’s share of apparel keeps growing, from 6.25 percent in 2015, and 11 percent in 2017, to an estimated 19 percent in 2020.

Brown highlighted Amazon’s growing dominance in clothing and accessories, noting that the online behemoth will capture 16 percent share in 2021, and revenues of $62 billion, leaving Macy’s and T.J. Maxx behind with $23 billion and $26 billion, respectively.

“Amazon puts almost of its money back into infrastructure,” Brown said. “Everything that retail is going through is a direct result of Amazon’s industrial real estate strategy. Amazon doubled its distribution space and created capabilities for next-day delivery.” Amazon accounted for 43 percent of all online sales last year.

If there’s a bright spot in any of this, Brown said it’s off-pricers. Burlington is opening 30 stores; Macy’s Backstage, 30 to 40; Ross Stores, 30 to 50; Marshalls, 35 to 50; Nordstrom Rack, 25 to 35, and T.J. Maxx, 40 to 50.

Meanwhile, the number of shopping malls are falling in the U.S., from 1,350 in 2007 to 1,150 this year, to an estimated 850 by 2027.

Brown said there’s no room for mediocrity in retail. Shopping centers with the A+ through B designation are safe, he said, while lesser properties in the B- to D range are skirting on the edge.

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