RESURGENCE OF RETAIL - 2021 JONES LANG LASALLE IP, INC. ALL RIGHTS RESERVED.
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Resurgence of Retail © 2021 Jones Lang LaSalle IP, Inc. All rights reserved.
Cyclical Factors
• Spending has returned, and for some sectors
surpassed, pre-COVID levels, but not all retail
sectors have recovered.
• Urban retail will continue to suffer more than
suburban shopping until daytime workers
return to offices, and tourism levels return to
normal.
• Retail sales reached a new peak in May of
this year, bolstered by the combination of
robust savings during the pandemic and
pent up demand
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 2
Retail sales have exceeded expectations and are poised
to set 2021 sales
Retail recordshave
from exceeded
pent up demand
expectations and are poised
to set 2021 records from pent up demand
• sales
• Retail Retail sales
dipped dipped
slightly slightly
in June after in Retail spending is set to break records in 2021
June
reaching a newafter
peakreaching a new peak in
in May of $641M $700,000
May of $641M
• The uptick in vaccinations, relaxed retail $650,000
• The warmer
restrictions, uptick weather
in vaccinations,
and stimulus
checks relaxed retailtorestrictions,
all contributed the observed warmer $600,000
uptick. weather and stimulus checks all
contributed to the observed $550,000
• The National
uptick.Retail Federation raised its
outlook for the year and predicts that retail $500,000
• will
sales The National
grow between Retail Federation
10.5% and 13.5% in
2021. raised its outlook for the year and
Monthly retail spending
$450,000
(millions)
predicts that retail sales will grow
between 10.5% and 13.5% in $400,000
2021.
Apr. 2020
Apr. 2021
Jan. 2018
Jan. 2019
Jan. 2020
Jan. 2021
Source: US
USCensus
Census
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 3
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 3
Retail sales remained static M-o-M in June, but most
sectors continue to see huge gains from 2020
Retail sales remained static M-o-M in June, but most sectors
continue to see huge gains from 2020
• Two of the hardest hit sectors during the Year-over-year % change in spending as of June 2021
• Two of the hardest hit sectors
pandemic –during
apparelthe
andpandemic
F&B – continue
– apparel and
to see significant
F&B growth as municipal
– continue to see significant Apparel 47.1%
restrictions growth
are relaxed.
as municipal restrictions F&B 40.2%
are relaxed. Electronics & appliances 37.3%
• Pent up demand for restaurant experiences
Gas stations 37.1%
• Penttoup
has contributed demand
a 40.2% for restaurant
increase in food
Department stores 24.4%
& beverage experiences
spending. has contributed to a
40.2% increase in food & beverage Misc. retail 22.8%
spending.
• All retail categories outside of grocery are Auto parts & dealers 19.5%
seeing outsized gains compared to April Total retail 18.0%
• All retail categories outside of
2020, when lockdowns were at the strictest. Furniture & home furnishings 17.1%
grocery are seeing outsized gains
Health & personal care
compared to April 2020, when 13.8%
lockdowns were at the strictest. General merchandise 10.5%
Sporting goods & hobby 10.2%
Building materials 6.8%
Grocery stores 2.5%
Source: JLL Research, US Census
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. Source: JLL Research, US Census 4
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 4
Residential shopping districts in cities have returned or surpassed
previous volume,
Foot trafficwhile CBD shopping
in residential districts
areas have yet to fully recover
has recovered
• Suburban• shopping
Suburban shopping
centers centers and prime
and prime Shopping center foot traffic exceeds pre-pandemic levels in
urban corridors located near residential some cases
urban corridors located near residential
neighborhoods have seen foot traffic return 60%
neighborhoods have seen footlevels.
to pre-pandemic traffic return
Residential prime urban corridors
to pre-pandemic levels. 40%
Office / tourist prime urban corridors
• Residential prime urban corridors have
% change in foot traffic since 2019
Suburban centers / malls
20%
• Residential seen
primethe greatest
urban recovery,
corridors have seenwith foot traffic Urban centers / malls
having now exceeded pre-pandemic levels 0%
the greatest recovery, with foot traffic having
by 18% on average.
now exceeded pre-pandemic levels by 18% -20%
• Demand will eventually return for central
on average. -40%
business district retail, but flexible work-
• Demand willfrom-home
eventually policies
return forthrough
central 2021 will mean -60%
few daytime
business district workers
retail, but flexibleto spend at retailers
work- -80%
that survive on office density. +0.4%, Suburban shopping centers
from-home policies through 2021 will mean -100%
+18%, Residential PUCs
-16%, Urban shopping centers
few daytime workers to spend at retailers -29%, Office/Tourist PUCs
-120%
that survive on office density.
Aug-20
Sep-20
Jul-20
Nov-20
Dec-20
Jul-21
Jan-20
Jun-20
Jan-21
Jun-21
May-20
May-21
Feb-20
Mar-20
Feb-21
Mar-21
Apr-20
Apr-21
Oct-20
Select shopping centers were chosen to represent Source:JLL
Source: JLLResearch,
Research,Placer.ai
Placer.ai
markets that JLL tracks nationally
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 6
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 5
Center City shopping corridors have recovered more pedestrian traffic than some other
Las Vegas,
major shoppinga destinations
hotspot for domestic
including tourists,
Fifth Avenue, has
Michigan seen
Avenue, the Crossing
Downtown
fastest recovery in foot traffic
PrimeUrban
Prime UrbanCorridors
Corridors foot
foottraffic
traffic(change from
(change June
from 20192019
June to June 2021) 2021)
to June
Las Vegas Strip -4.4%
Miami - Lincoln Rd -5.5%
San Francisco - Marina -10.2%
Los Angeles - Beverly Hills Triangle -11.0%
Boston - Seaport District -11.9%
NYC - SoHo -18.8%
Los Angeles - Abbot Kinney -20.7%
Chicago - Oak St -21.4%
Boston - Newbury Street -22.1%
NYC - Meatpacking -23.5%
San Francisco - Fillmore -24.6%
Chicago - S Fulton Mkt -25.1%
Philadelphia--Market
Philadelphia Market East
East -28.8%
-28.8%
Washington DC - M Street -29.6%
NYC - Madison Ave / Upper East Side -31.1%
Philadelphia-- Walnut
Philadelphia Walnut St
St -36.3%
-36.3%
Chicago - N Michigan Ave -38.2%
San Francisco - Hayes Valley -38.5%
Chicago - S Michigan Ave -45.6%
Boston - Downtown Crossing -46.4%
NYC - Fifth Avenue -46.9%
Midtown Rock Center -48.3%
Chicago - State St -48.7%
San Francisco - Union Square -57.6%
NYC - Times Square -60.0%
Source: JLL Strategic Consulting Group survey of Fortune 500 office users, WSJ
Source: JLL Strategic Consulting Group survey of Fortune 500 office users, WSJ
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 6
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 7
Grocers continue to bet big on the CBD’s growing population. 15 supermarkets
have opened in the last five years, with half a dozen more on the way in 2022-2023.
Grocers are betting big on Philadelphia’s continued role as a residential destination of choice within the broader region for moderate and high-
income households.
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 7
Average Center City Daily Pedestrians, Weekday & Weekend
Average Daily Pedestians, Weekday Weekend
250,000
200,000
150,000
100,000
50,000
-
0
1
0
1
19
9
0
20
20
1
9
0
0
1
20
21
0
1
9
0
0
1
20
21
-2
-2
2
2
l-2
l-2
-2
-2
t-1
r-2
1
2
t-2
r-2
2
v-1
v-2
c-
c-
n-
n-
n-
n-
p-
b-
p-
b-
g-
g-
ar
ar
ay
ay
Ju
Ju
De
De
Oc
Oc
Ap
Ap
No
No
Ju
Ju
Ja
Ja
Se
Fe
Se
Fe
Au
Au
M
M
M
M
Weekday Weekend
Source: Center City District, pedestrian volume counters
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 8
Newly Opened and Coming Soon Retailers
Brewery Fine Dining
• Meyers Brewing Co. • Misconduct Tavern • Schulson – Two Restaurants • Wilder
• Victory Brewery Company • Uptown Beer Garden • Dolce Italian • Sor Ynez
• Source Farmhouse Brewery • Lawn at Loveluck
• Other Half Brewing Co. • Sunset Social
• Brewery ARS
Sweets
Casual Full-Service • Sugar Factory American • Sprinkled Sweetness
Brasserie • Float Dreamery
• Sabrina’s Café • La Chinesca
• Jeni’s Splendid Ice Cream • Reanimator
• Top Tomato • Coney Shack
• Van Leeuwen Ice Cream • Korshak Bagels
• LMNO • Eeva
• Rex 1516 • Huff & Puff BBQ
• Kalaya Thai Kitchen • Ember & Ash
• Hook & Master • Gabriella’s Seafood & Steak
• El Chingon • Saigon Quy-Bau
Retailers
• For Eyes • Philadelphia Runner
• Primark • Shoppers World
• Taft • Mitchell & Ness
Fast Casual
• &Pizza • Fudena
• Honeygrow • Juana Tamale
• Farina Pasta & Noodle • South Philly Barbacoa
•
•
Federal Donuts
Goldie
•
•
Ma Lessie’s Chicken & Waffles
Taco & Ramen
CBD
• Middle Child Clubhouse • Suya Suya West African Grill • CBD Kratom
• Primary Plant Based • Salam Café • Sunnyside
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 9
Where do we go from here?
Structural Factors Key Structural Considerations
Retail of the future will have: Theme Potential impact
• Less overall selling space • Essential retailers including grocery stores, mass merchandisers, home improvement stores and
quickservice-restaurants have seen significant sales increases during the pandemic and will continue to
• Fewer mid-priced retailers outperform other retail sectors
• Tech-driven convenient shopping A world of retailer have and have-nots • Retailers unable to operate at full capacity like dine-in restaurants, gyms and theaters will struggle to
remain in business
• And impressive high-impact experiential • Mid-priced retailers, specifically mid-priced apparel and department stores, will struggle to stay relevant
as consumers emerge from the pandemic with tighter budgets looking for value.
retail hubs
• Increased bankruptcies from COVID-19 will expedite closures and leave large vacancies across the
Less retail space country, particularly in B and C malls. Much of this space will not be re-tenanted and will either be
demolished or repurposed for other uses.
• E-commerce sales had been growing steadily over the past decade, but the pandemic will have
Growth of e-commerce
accelerated that growth.
• Buy online, pick-up in store and curbside pick-up will be a requirement for many retailers as shoppers
have become accustomed to convenience during the pandemic
Shoppers demand convenience and
• Real estate with drive-thru capabilities will be in demand from quick-service restaurants
reliable omnichannel options
• Retailers will incorporate more technology into the shopping experience for customers and will utilize
new software for back-of-house operations to improve efficiencies.
• Prior to the pandemic, entertainment was one of the top uses for retail space as consumers prioritized
experience over material goods, especially younger generations
Entertainment will make a comeback
• When people feel comfortable socializing again, demand for entertainment will return. More than ever,
people will value time spent with family and friends and will seek out these experiences.
© 2021 Jones Lang LaSalle IP, Inc. All rights reserved. 10Paige Jaffe Managing Director, Retail paige.jaffe@am.jll.com +1 215 988 5500 © 2021 Jones Lang LaSalle IP, Inc. All rights reserved.
You can also read
