Tag Archives: retail sales

Black Friday deals in Arizona

2010 Black Friday Deals

It’s almost Black Friday – get ready for crowded malls, packed parking lots and maybe even a bit of elbowing for that amazing deal.

The malls will be teeming with eager shoppers hungry for a deal, especially since the National Retail Federation predicted a holiday sales increase of 2.3 percent this year. That’s a big bump since last year there was only a .4 percent holiday sales increase.

Most, if not all, major chains are slashing prices in an attempt to boost this year’s retail sales. Some stores are even keeping their Black Friday deals going through the weekend or they’re open Thanksgiving Day.

Apple

Apple’s having Cyber Monday sales on Black Friday. Apple announced at one-day shopping event on Black Friday for the online store only. The announcement says: “You’ll find dozens of great iPad, iPod, and Mac gifts for everyone on your list.”

Macy’s

Open: 4 a.m.
Locations
Preview:

  • All remote-controlled helicopters are 60 percent off.
  • Selected bedding is 60 to 70 percent off.
  • Stock up on selected Christmas ornaments that are 50 percent off.

See the deals

Kohl’s

Open: Shop online Thanksgiving Day until 2 p.m. Stores open at 3 a.m. on Black Friday.
Locations
Preview:

  • Half off selected Fisher-Price, Playskool, Barbie and other children’s toys.
  • Selected fashion jewelry 50 to 60 percent off.
  • Save more than 50 percent on selected cookware sets.

See the deals

Best Buy

Open: 5 a.m. – But, to get these deals tickets will be handed out starting 2 hours prior to open. Tickets are necessary to buy certain products.
Locations
Preview:

  • Save $1,000 on an LG washer and dryer set.
  • Save $25 on several EA Sports Xbox360 and PS3 games.
  • Save $30 on Wii consoles.

See the deals

Target

Open: 4 a.m.
Locations
Preview:

  • Target is being rather tight-lipped about their Black Friday deals. All we know is Target’s having a two-day sale, Nov. 26 and 27, and you can sign up to get an e-mail alert about the Black Friday deals. You can also get alerts for Target’s Cyber Monday deals. But don’t worry if you forget, we’ll remind you again.

See the deals

For those who just can’t wait until Friday, Kmart and Sears are open Thanksgiving Day at 7 a.m. and 6 a.m., respectively.

Kmart

Open: 5 a.m. (Note: “Blue” Friday deals last from 5 – 11 a.m.)
Locations
Preview:

  • Six-foot Christmas tree for $19.99.
  • Billiard or air hockey table with table tennis attachment for $189.99.
  • Kids’ graphic tees for $2.99.

See the deals

Lowe’s

Open: 12:01 a.m. Nov. 25 (Yes, that’s one minute after midnight on Thanksgiving) online. 5 a.m. Nov. 26 in stores.
Locations
Preview:

  • DeWalt cordless drill with case for $99.
  • Frigidaire eight-bottle wine cooler for $49.
  • Skil 10-inch compound miter saw for $59.
  • Deals valid from Nov. 26 – 29.

See the deals

More Black Friday resources:
BFInsider.com | MyBlackFriday.com | 2010BlackFridayAds.com | BlackFriday.org

Vacancy Rising in Phoenix

Vacancy Rising In Phoenix Despite Construction Pullback

Though employment growth will stimulate an increase in retail sales in 2010, the job additions will not be sufficient to prevent the vacancy rate in Phoenix from rising for the fifth consecutive year, according to the latest Retail Research market update from Marcus & Millichap.

Unlike previous years when excessive construction drove vacancy increases, lagging demand has become the anchor on the market. The pace of store closures clearly has slowed, but too few retailers have emerged to open new locations in the vacant space that has amassed. With the vacancy rate nearing its highest level in 20 years, rents continue to fall as tenants exercise the upper hand in discussions with owners.

Rents have yet to settle at a new, lower market level and may not reach their low point until late next year. The upside of reduced rents, however, has been a sharp decline in construction, as many projects simply no longer pencil for developers. After deliveries averaged 5.5 million square feet of new space each year during the past decade, a fraction of that total will come online in 2010.

Although the slowdown in construction represents a positive trend in a market with frequent overbuilding spells, the lack of properties under construction will restrain sales of new single-tenant, net-leased assets. As in other markets around the country, single-tenant properties net-leased to top-rated corporate tenants generate intense bidding when listed. In fact, cap rates for nationally branded drugstores and fast-food properties have fallen about 50 basis points since early this year to around 7 percent, with ground leases commanding even lower first-year returns.

In the multi-tenant segment, buyers have intensified searches for suitable listings, but the ongoing reduction in rents continues to present challenges to arriving at valuations upon which owners and prospective buyers can agree. Current underwriting assumes additional increases in vacancy and further rent reductions, such that cap rates must vary from 10 percent to 11 percent to generate bids. Among specific properties, those with tenants that signed leases at the peak of the market
in 2006 and 2007 invariably face the prospect of re-leasing space at substantially lower rents when leases expire.

2010 Annual Retail Forecast

Employment: Government employment will decline over the second half due to the termination of census jobs and budget constraints at the state and local levels, while private
sector employers will hire conservatively. As a result, total employment will expand 0.8 percent in 2010, or by 13,700 jobs. Last year, 116,000 positions were cut.
Construction: Developers will complete 500,000 square feet of space this year, the lowest annual total in 30 years. In 2009, approximately 2.9 million square feet came online. Planned projects total 28 million square feet, although none has a scheduled start date.
Vacancy: The vacancy rate will increase 70 basis points this year to 12.6 percent, as store closures and a lack of new demand will result in negative net absorption of 721,000 square feet. Vacancy spiked 260 basis points last year and most recently surpassed 12 percent, a level last reached in 1991.
Rents: This year, asking rents will decrease 1.3 percent to $18.11 per square foot, following a 5.5 percent dip in 2009. Effective rents will slide 2.6 percent to $15.13 per square foot, compared with a 9.1 percent drop last year.

The State’s Economic Forecast For The Rest Of The Year - AZ Business Magazine Jul/Aug 2010

The State’s Economic Forecast For The Rest Of The Year Calls For An Agonizingly Slow Recovery

Ready to heave a sigh of relief over Arizona’s economy? Go ahead — but don’t get carried away. Some observers expect the second half of this year will bring positive signs that the economy is recovering, turning the dial toward even stronger growth in 2011 and 2012. Others aren’t so sure the state’s recession is in the rear-view mirror yet, and that a quick rebound is in the cards. Two of Arizona’s leading economists, Marshall Vest and Lee McPheters, disagree on how this year will shake out and how quickly a full recovery will be reached.

Half full

Vest, an economist at the University of Arizona’s Eller College of Management, believes Arizona’s economy hit bottom at the end of 2009. He forecasts retail sales will increase 5 percent this year and 10 percent in 2011. Home builders are buying back land they sold a few years ago and preparing for new construction. The housing market is improving “fairly rapidly,” with sales of existing homes up and housing prices stabilizing.

“Housing prices will continue to move up because they are well-below trend,” Vest says. “New-home permits are off the bottom, but I don’t see a whole lot of upward potential until we have absorbed all the vacant houses.”

He estimates inventory at 120,000 homes statewide.

As for that other troublesome spot in the economy, jobs, unemployment dropped to 9.5 percent in April, and may already have peaked.

“I think we’ll see slow improvement in the number of unemployed,” Vest says. “But it probably will be two or three years before we get the (unemployment) rate below 6 percent.”

He expects the hospitality industry, wholesale trade, and the professional and business services sector to show employment gains the second half of this year. New jobs will attract more people to Arizona and Vest predicts the state’s population will grow by 2.5 percent in 2012.

“I don’t expect to see the 4 and 4.5 percent growth from the last expansion because the population base is so large now,” Vest says. “But a 2.5 percent increase is a lot of people.”

Although he says it will take years to repair the damage, Vest sees better days ahead, with the economy in full recovery by 2013.

“This year simply sets the stage for much stronger and broad-based growth in 2011,” he notes. “We should see some significant growth in most sectors of the economy in 2011 and 2012. The areas growing fastest likely will be professional and business services, trade, hospitality, health care and residential construction.”

However, commercial real estate and the public sector will continue to be a drag on the economy, according to Vest.

“Tax revenues lag at least a year behind an economy that is recovering,” he says. “It will be at least a year, maybe two or three, before state and local government regains its footing.”

Half empty

McPheters, research professor of economics at the W.P. Carey School of Business at Arizona State University, thinks Arizona’s recession is still in play as measured by employment. Reaching 2.7 million jobs, the peak of employment in 2007, indicates a full recovery, McPheters says. More jobs may be lost this year — perhaps 24,000 — and 2010 could close out with 2.4 million people employed.

“So 2010 is another recession year,” he notes.

McPheters sees recovery in three to four years. Full recovery could come in 2013 if Arizona averages 3.7 percent job growth between now and then, McPheters says. Three percent job growth means recovery in 2014.

Arizona’s economy likely will creak along at its trough through the second half of the year but “2011 should be a year when home prices, population and jobs show modest improvement,” McPheters says.

He forecasts a gain of 48,000 jobs next year, a 2 percent increase over 2010. Population should grow 1.8 percent, a nudge of 0.3 percent. Homebuilders will take out 17,800 single-family housing permits this year and 28,480 next year, but “you would expect Arizona to generate 40,000 to 50,000 permits in a ‘normal year,’ ” McPheters says. “The housing recovery really hasn’t unfolded the way I thought it would.”

He won’t forecast retail sales until he has more data in hand.

A labor shortage?

Dennis Hoffman, professor of economics at the W.P. Carey School of Business, sees more questions than answers in Arizona’s immediate future.

“If you look at any kind of model about Arizona, you see significant growth coming in 2011 and 2012,” Hoffman says. “But that is nothing more than a reflection of history. The question is, are the dynamics that drove (economic) bounces in the past in place this time? This one may be different.”

Arizona’s rapid-paced recoveries from prior recessions “were fueled by the immediate availability of an abundant supply of undocumented cheap labor,” Hoffman says. “With Arizona’s attitude toward undocumented laborers, it’s pretty clear that abundant undocumented workers may be a headwind for us.”

With much of their assets tied up in real estate, Arizonans suffered “wealth erosion of massive proportions” as home prices slid 40 percent to 60 percent, Hoffman adds. Personal spending cratered and tax revenues plunged. Hoffman says the country’s household wealth fell 3 percent from December 1928 to December 1929 during the Great Depression. National wealth deteriorated 17 percent from December 2007 to December 2008 during the current recession, and Arizona was at least twice that bad, he notes.

“If we could regain consumer confidence and begin consuming close to historical norms, you’re talking between $14 billion and $16 billion in taxable spending,” Hoffman says. “That would do a lot to cure the ills of our very wounded economy.”

Arizona must become a magnet for new residents again, according to Hoffman, because in-migration fuels tax receipts as new arrivals buy homes, cars, furniture and other goods and services.

Residents needed

Indeed, economist Elliott Pollack, CEO of Elliott D. Pollack & Company, says Arizona will recover only if more people relocate to the state.

“We won’t need another square foot of housing, we won’t need another square foot of office space if people don’t move here,” Pollack says. “I expected population inflows to slow, but I never dreamed it would come to a screeching halt.”

Arizona’s total population growth (in-migration, plus births, minus deaths) was 3.1 percent in 2007 and 0.8 percent in 2009, Pollack says, noting that population will pick up slowly over the next four or five years.

He adds that Arizona’s recovery will be gradual and painful because the national recovery will be sluggish.

“Consumers are not nearly as able to spend as they have coming out of past recessions because they have to pay down debt and increase savings,” Pollack says. “That is not something they had to do in past recoveries.”

Becoming business friendly

Don Cardon, director of the Arizona Department of Commerce, sees “significant things happening in invisible areas.” He is bullish on the re-emergence of investment capital in Arizona this year.

“I am sincerely positive about what’s anticipated for the third and fourth quarters,” Cardon says. “I think we will see a re-engagement of capital streams, a softening of the ability of large investors to be interested in Arizona industry.”

Large investors will “beta test” the state and then secondary investors will decide they “have been out of the water way too long,” Cardon says. He sees Arizona businesses gaining traction over the next year. He also believes new capital will flow to energy-related industries, particularly renewable energy, the technology sector, small business and entrepreneurial ventures.

Last year, Gov. Jan Brewer appointed a commerce advisory council to identify an economic development model for the state and, following the group’s recommendations, has proposed scrapping the Commerce Department and replacing it with a so-called public-private commerce authority. Cardon says the authority would give Arizona a vital ingredient for improving the economy — focus.

“(The authority) has received unparalleled favor across party lines and in all sectors of business because it represents a sense of focus,” Cardon says. “We’re saying that at the state level, we haven’t been focused and we lost our connection with legislative support and confidence.”

Once necessary laws are passed to establish the authority, it “will create a tool for the private sector to say, ‘I understand this. We can count on them.’ We will go from an intangible entity to something that is specific and highly energized,” Cardon says.

The authority will emphasize energy and business attraction, retention and expansion, he says.

A boost to Arizona’s competitive position is critical to an economic recovery, and a statewide economic development program backed by a supportive tax policy is overdue, says Barry Broome, president and CEO of the Greater Phoenix Economic Council. In the meantime, he believes Arizona’s economy will bounce back “quicker than people realize, that it will be strong and that it will result in a faster rate of job recovery than economists are projecting for Phoenix and Arizona.”

Over the next year and a half, Broome says, Arizona will develop a full-fledged, renewable-energy cluster and transform itself into a solar energy hub; health care will experience a strong expansion with emphasis on information technology and telemedicine; and the aerospace market will hold its own. In addition, Broome expects an uptick in regional headquarter activity.

www.azcommerce.com | www.ebr.eller.arizona.edu |www.elliottpollack.com | www.gpec.org | www.wpcarey.asu.edu

Arizona Business Magazine Jul/Aug 2010