Tuesday, January 27, 2009

2007 Retail Sales data for the four largest cities

Here is another more detailed cut of the 2007 Retail Sales data that was released at the beginning on this month. The charts show the share of total Marin County sales that is captured by each of the four largest cities for four types of retail store.

For Apparel stores, Corte Madera is the place to go. More than a third of the County's sales at apparel stores take place here. The Village at Corte Madera captures almost all of these sales and it's share has probably strengthened since then. Since 2007 several new apparel stores have opened at The Village, including Abercrombie & Fitch, True Religion, Martin & Osa, Puma and Michael Stars.

General Merchandise is also strong at Corte Madera (think Nordstrom & Macys), with San Rafael (Northgate department stores) also getting a quarter of total county sales. The winner however is Novato, with the big boxes at Vintage Oaks (Costco, Target) helping the city take a third of county sales.

Sales at Eating and Drinking places is by contrast widely distributed across the county. Almost half of sales in these outlets occur outside the big four cities. Marinites are lucky to have many options in this category, with multiple eateries available in towns such as Tiburon, Sausalito, San Anselmo and Larkspur.

When it comes to Furnishings & Appliances, San Rafael takes the prize, capturing almost 50% of Marin County sales. Big boxes along 101 and Bellam, and smaller furniture and homewares outlets along Fourth Street, help make San Rafael the destination of choice for these purchases.

Home Depot to shutter Yardbirds

Home Depot's Yardbirds store on Fourth Street in San Rafael has become the latest high profile casualty of the recession. The hardware chain announced yesterday that it is shuttering its 34 Expo Design stores and 5 Yardbirds stores as part of a consolidation around the core Home Depot Brand.

This is the second goodbye to Yardbirds in just three years. The original chain was purchased by Home Depot in 2006, a move that was mourned by many as a sign that the store's days were numbered. According to those who know, the site was originally occupied by the Alpha Beta Market [photo credit: Romley].

Tuesday, January 20, 2009

More 2007 Retail Sales Data

The chart below details the broad retail categories for which retail sales tax data is collected. It is worth noting that the data only reflects those goods and services that are liable for sales tax. Food and grocery sales and prescription medicines are two important examples of goods that do not incur sales tax.
  • The largest retail sales category is motor vehicles, with sales of over $600 million across the county in 2007.

  • Aside from Other retail stores, the next largest categories are General Merchandise stores (such as Macy's, Target etc) and Eating & Drinking Places.

Top Retail Cities in Marin

Continuing our look at the retail sales tax data for Marin County from the California Board of Equalization (great name by the way). The table below shows total sales at retail outlets by city for the years 2006-07. So what is it telling us?
  • San Rafael captures the largest slice of retail sales, with $1.3 billion or 38% of sales in Marin in 2007. San Rafael extends over quite a large area, which includes the downtown area, Northgate Mall, the big box retail along 101, Montecito Plaza and Home Depot.
  • Novato is the second largest city, with 18% of the total, or $595 million. Most of this is drawn through Vintage Oaks.
  • Corte Madera, with sales of $450 million, or 14% of the total, takes third place.
  • The city with the greatest increase in sales was San Anselmo, with growth of $9.9 million, or 14% between 2006 and 2007. I don't recall any major retail changes taking place, so I wonder if the change reflects the impact of the floods on New Years Day 2006, which took out many downtown businesses for several weeks.
  • Mill Valley also had a good 2007, up $6.9 million or 3.7% in 2007, possibly as a result of new store openings at Strawberry Village.
  • Corte Madera recorded the greatest fall in sales over the period, down $4.2 million or 0.9% in 2007. This may reflect refurbishment work at the Town Center (Barnes & Noble) and The Village, which went through a program of renovations in 2007.

The BoE data also provides details of sales by retailer category. Unfortunately, the Board is in the process of changing how it classifies businesses, so we can't do a meaningfull comparison with previous years. I'll publish some charts with this data later this week.

Friday, January 16, 2009

Larkspur Landing lands a new owner

As reported by Globe St.com, Larkspur Landing Shopping Center has been sold to JS Rosenfield & Co for $65 million.

Rosenfield aims to reposition the center along the lines of a "Country Mart", which is a concept based on the Brentwood Country Mart in Los Angeles:

"The key to the success of the country mart concept is its welcoming environment with its exceptional public spaces, essential local services, restaurants and extraordinary boutique shops,” says Rosenfeld & Co principal James Rosenfield. “But what sets the country mart apart from other retail concepts is the architecture that takes into consideration the human scale, something that has been largely forgotten in the monumental focus of today's malls and large retail centers."

The Brentwood Country Mart (pictured above) is a nostalgic small-town style mall that contains some of the most exclusive boutiques in LA. It has been a major celeb-spotting destination for many years, with Joan Crawford and Elizabeth Taylor being two of the regular vistors in years gone by. According to the excellent website SeeingStars.com, you are likely to spot the likes of Steven Spielberg, Tom Hanks, Reese Witherspoon and OJ Simpson (currently residing elsewhere) wandering in and out of the stores.
As we commented in our Larkspur Landing post last year, there is certainly plenty of room for improvement in the center, and plenty of vacant and under-used space for the new owners to work with.
The key question is whether the center can provide anything that is not already available in the area, either at Bon Air, the Corte Madera Town Center or The Village, all of which are located within a mile of Larkspur Landing and already offer the kind of small-scale, up-market experience that the new owners are proposing?

Friday, January 9, 2009

Pacheco Plaza renovations continue as hunt for anchor gets close

According to the Marin IJ, the owners of Pacheco Plaza are close to announcing the new anchor tenant of their refurbished Ignacio shopping center, and if the reports are true, it looks like it's going to be "one of the best upscale markets in the Bay Area".

But which grocer will it be? Woodland Market? Andronicos? Mollie Stones? Or maybe the Boardwalk Market that is scheduled to lose its Tiburon lease in 2 years? A few other potential candidates not already in Marin are Draegers, Bristol Farms, Napa's Oakville Grocery perhaps?

There are plenty of candidates but also plenty of hurdles to get over before that lease is signed. The biggest Safeway in the county has recently opened half a mile away at Hamilton, and the county's biggest Whole Foods is under construction in Novato. Oh, and we're also in the middle of the biggest drop in consumer spending in living memory.

But let's hope a deal gets done and the owner's investment in upgrading the Plaza pays off.

Wednesday, January 7, 2009

More pain on the national retail scene

Reis reports that vacancies at US malls are now at a 10-year high and expected to rise further:
“So much of consumer spending depends on the wealth effect,” said Victor Calanog, director of research at Reis. “Unfortunately, all three conditions are still in flux. Even when they stabilize we often observe anywhere from a 12- to 24- month lag until commercial retail properties begin benefiting.”

US mall vacancy rates increased to 7.1% in 4Q 2008, with shopping centers rising to 8.9%.

Meanwhile, retailers are exerting pressure on landlords to lower rents as the recession impacts their sales. Leasing conditions are the toughest they've been for several years, with landlords having to decide whether to offer concessions or force retailers into liquidation.

Tuesday, January 6, 2009

Going, going, gone..

As 2008 came to a close the list of retailers that closed their doors for good in Marin was getting longer. High profile chain stores made news headlines when they announced mass closings, while many smaller independent stores were put out of business quietly.

In October, department store Mervyns finally gave in and announced the closure of 149 stores, incluidng the one at Northgate San Rafael. In December, Kohl's was revealed as the new tenant for the site.

Circuit City announced the closure of 155 stores in November, including it's San Rafael outlet.

Back in May, Linen & Things, which used to have a store at Marin City, announced the closure of 120 underperforming stores.

Also gone are The Sharper Image and KB Toys, two well-known retailers that previously had stores in Marin.
In addition to these, there are empty storefronts appearing in all of the downtown areas and strip centers across the County, as independent boutiques and Mom & Pop stores struggle to survive. One of the great things about Marin is the abundance of small communities that still have a thriving retail presence; this is almost unique in modern-day stripmall America. If you want to maintain the character and viability of your local neighborhood center, now is the time to shop at your local stores and eat at your local restaurants.

Monday, January 5, 2009

2007 Retail sales data released

The California Board of Equalization recently released retail sales tax data for the fourth quarter of 2007, showing that the recession was well underway by the end of 2007 with retail sales in the state declining by $1.2 billion from the fourth quarter 2006. This was the second consecutive quarterly drop. We will have to wait another year for the data for 2008 to be released, but we would expect to see steepening drops in each quarter.

Marin County fared better than the state as a whole, with sales up a marginal 0.1% for the quarter and 1.7% up for the year. This is the worst performance since 2002, when retail sales declined following the fallout from the tech crash. The chart below shows the quick turnaround that occurred in 2003 and 2004: as the Fed loosened the money supply people went on a mammoth shopping spree. It will be interesting to see whether a similar bounce back occurs as quickly this time.