Madison Marquette Pinpoints 63 Distressed Retail Markets

WASHINGTON, DC-- Walter Bialas, (top right photo) vice president of research, Madison Marquette, has pinpointed the weakest retail markets in the U.S. today.


He says, "No region is immune from the downturn, but some markets are more vulnerable than others. Traditional measures of what regions may be troubled look simply at vacancy rates as a measure of distress.

"Yet there are other forces at work. Below is a list of 63 metropolitan markets ranked in order of how likely they are to produce distressed assets in the coming years. We measured and indexed the following factors:

-Velocity of vacancy rate deterioration
-Current vacancy rate

-Net absorption of new inventory-New inventory in the pipeline

-Level of pre-leasing

"Based on our indexing, the top 35 metropolitan markets are fertile ground for distressed assets.

The remaining markets, although stressed, are less likely to break under the weight of recession."

Metropolitan Markets By Potential for Distressed Retail Real Estate Assets

1. Phoenix 2. Las Vegas 3. Kansas City 4. Atlanta 5. Birmingham 6. Indianapolis 7. Memphis 8. Detroit 9. Sacramento 10. Providence

11. Houston 12. Dayton 13. Dallas / Ft Worth 14. Chicago 15. Inland Empire 16. Tucson 17. Jacksonville 18. West Michigan 19. Broward County 20. Columbus

21. St. Louis 22. Denver 23. Southwest Florida 24. Cincinnati 25. San Antonio 26. Palm Beach County 27. Philadelphia 28. Tampa / St Petersburg 29. Orlando 30. Austin

31. Greensboro / Winston-Salem 32. Northern New Jersey 33. Hartford 34. Nashville 35. Pittsburgh 36. Tulsa 37. Madison 38. Richmond 39. Toledo 40. Cleveland

41. Greenville / Spartanburg 42. Westchester / So Connecticut 43. Hampton Roads / Norfolk 44. Charlotte 45. Raleigh / Durham 46. Oklahoma City 47. Milwaukee 48. Portland 49. Seattle / Puget Sound 50. Salt Lake City

51. Miami-Dade County 52. Los Angeles 53. Washington 54. Boston 55. Minneapolis 56. East Bay / Oakland 57. Baltimore 58. Orange County 59. South Bay/San Jose 60. San Diego

61. Long Island 62. San Francisco 63. New York City

Madison Marquette is a retail real estate operator, investor and developer based in Washington, DC.

More information is available at http://www.madisonmarquette.com/.

The company also publishes PLACES Magazine, a publication devoted to examining trends in retail real estate. More information is available at http://www.places-magazine.com/.

Anemic Holiday Shopping Season Predicted

CHICAGO, IL-Kurt Ivey(top right photo), senior vice president, marketing, at Chicago-based Madison Marquette, says "Late last week I had the opportunity to listen to a conference call on “back-to-school shopping” hosted by Citigroup and Deloitte.

While the back-to-school shopping season is still underway, several stats were very telling in terms of today’s slower economy.

Among them, 71% of those surveyed planned to spend less this year (with 69% planning to spend $100 to $500 for the family).

Apparel appears to be taking the biggest hit with 83% planning to spend less. Not surprisingly, the main reasons for spending less are tied to higher gas, home energy, and food costs.

In terms of shopping, 88% planned to patronize the discount and value-oriented department stores. One of the most significant implications I saw in the study was that almost 70% of those surveyed planned to satisfy all their shopping needs in just 1 to 3 stores, suggesting very focused shopping trips.

This lower shopping activity, combined with the pervasive sentiment that our economy is weak has dramatic implications for retail spending in the second half of 2008. Unless conditions improve, driven to a large degree by noticeably stable lower oil / gas prices, we may be looking toward an anemic holiday shopping season.

CONTACT: Kurt Ivey, Senior Vice President, Marketing, MadisonMarquette, kurt.ivey@madisonmarquette.com

rue21 Lifts Spirits at Florida ICSC

WASHINGTON, DC--Retail leasing pros weren’t optimistic coming into this year’s ICSC Florida Conference in Orlando, notes Kurt Ivey, (top right photo) Senior Vice President, Marketing at MadisonMarquette.

" The economy is slumping and many retailers aren’t expanding this year. Expectations sank even lower Monday morning when tropical storm “Fay” forced many to cancel or alter their travel plans," Ivey says in his Places Magazine Blog published by MadisonMarquette.

"But like a breath of fresh air, affordable teen fashion retailer rue21 lifted everyone’s spirits by announcing that they were looking to add 100 new stores this year — including a significant expansion in Florida.

" The announcement came during the “Hot Retailers” session and really seemed to energize everyone.

"Other bright spots included the continued rapid expansion of the Five Guys burger franchise in Florida and around the country. I’m also sensing continued bullishness towards Orlando and the entire Southeast Florida region — even despite the housing market."

CONTACT: Kurt Ivey, Senior Vice President, Marketing, MadisonMarquette, kurt.Ivey@madisonmarquette.com