The International Council of Shopping Centers (“ICSC”) held its annual Global Retail Real Estate Convention (“RECon”) in Las Vegas from May 20-23. Over 30,000 attendees and 1,000 exhibitors lined the halls of RECon 2012 and those in attendance observed a guarded optimism and tempered enthusiasm that has been absent in recent years. Although the U.S. retail real estate sector has yet to fully climb out of the effects of the downturn, an upbeat outlook was common among attendees.
Cause for optimism was largely based on increased activity due to retailer demand. However, this demand is not across the board. Activity has been seen to have a strong correlation to asset characteristics such as asset type and location. A common sentiment among attendees was that “A” properties in certain parts of the country have been trading and renting more than others. On the other end of the spectrum, discount and dollar type stores continue to be the dominant players in new store openings.
Another trend that continues is big box stores decreasing the size of their prototypes. Some of this is occurring to enable these big box stores to be more flexible as they enter urban markets. However, the overall sentiment among these retailers is that their current footprint is just too big for current times. Some attribute this attitude to the growing strength of internet sales, which enables retailers to operate in less space.
Another observation by attendees was the widespread utilization of iPads and other tablet computers. Attendees were commonly seen with iPads in tow as they roamed the convention halls. In addition to the ability to remain connected with co-workers and clients while out of the office, attendees could be seen showing project presentations with much greater flexibility and ease via applications such as Keynote and PowerPoint, among others. ICSC has even released its own iPad application, ICSC Mobile, which enables member lookup and provides event information as detailed as floor layouts.
Unfortunately, the economic challenges in Europe have noticeably worsened since RECon. In follow-up conversations with attendees at RECon, some have become less upbeat about the near future pending what happens overseas. More on that in later blogs.