Looking back at real estate’s 2009 headlines
A decade from now, we probably still won’t be laughing. There’s nothing funny about the recessionary pain suffered in 2009, and many of us are still digging out -- with an eye toward salvaging as many months of 2010 as we possibly can.
That being said, not all the headlines generated in 2009 were nasty. Granted, there was plenty of bad news, but some sectors of retail actually experienced gains during the downturn. In a recent special edition of our bi-monthly real estate e-newsletter SiteTalk, Chain Store Age looked back at real estate’s biggest headlines of 2009. Following is a recap:
In a year when the motto was “adapt,” Simon Property Group added “acquire” to the adage -- as the Indianapolis-based mega-mall-owner made its biggest buy in a half-decade when it agreed to purchase Prime Outlets Acquisition Co. from Lightstone Group for about $2.3 billion. The deal gives Simon an additional 22 retail outlet centers, increasing its total to more than 60.
Someone forgot to tell the dollar stores that 2009 was a bad year. In fact, in December, Dollar General reported a third-quarter profit of $75.6 million -- this compared to a loss of $7.3 million (which included a $37.4 million lawsuit settlement) in the prior-year period. Total sales in the quarter soared, and comps followed suit. On the heels of such positive news, Dollar General announced it would open 600 new stores in 2010 and remodel or relocate another 500.
And, during a year when store expansions came to a screeching halt, some states are said to be beginning to feel the stirrings of new retail life. A December report by Pitney Bowes Business Insight spotlighted impending growth in the state of Texas -- where four of the top five slots in the firm’s ranking of the “Top 10 U.S. metropolitan areas expected to experience quarterly retail sales growth for the remainder of 2009 and into 2010” went to Texas towns. (Baltimore, at No. 2, was sandwiched between top-ranked Austin and third-ranked Houston, followed by Dallas and San Antonio.)
And then the bad news. In 2009, landlords and retailers were decimated by credit and spending shutdowns. In April, General Growth Properties filed for bankruptcy protection -- some called it one of the biggest real estate failures in U.S. history. And electronics retailer Circuit City got the legal green light to liquidate and close its remaining 567 stores, joining Linens ’N Things in extinction.
A legend was lost in 2009, when mall pioneer Melvin Simon passed away in September. An entire industry mourned the death of a man who co-founded the company that would become Simon Property Group, North America’s largest shopping center owner and one of the largest public companies in the United States. Simon was 82 years old.
Never one to end a column on a down note, it is important to mention that I attended the ICSC-New York deal-making conference in December, where the mood was decidedly lighter than at other real estate shows earlier in the year. There was unquestionably a mood of optimism in the halls of the New York Hilton that the bottom had been touched and our industry was beginning its climb out of the recessionary black hole. Time to bid farewell to 2009, said attendees, and welcome in 2010 and the new opportunities it promises.