TRAFFIC PATTERNS
Jul 1, 2007 12:00 PM
Retail REIT stock performance; the top markets for investment in 2007.
NOT IN MY BACKYARD
Saint Consulting Group published their latest Saint Index, which measures the public's attitude toward development in Britain, Canada and the United States. Here are some highlights from this year's survey.
| U.S. | CANADA | BRITAIN | |
|---|---|---|---|
| Approve of local authorities' handling of planning issues: | 66% | 66% | 62% |
| Oppose new development in their community: | 73% | 75% | 83% |
| Have a perception of “cozy relationships” between developers and elected officials: | 75% | 60% | 58% |
| Like shopping in big boxes… | 6 of 10 say yes | 6 of 10 say yes | |
| But don't want one in their community. | 7 of 10 say no | 6 of 10 say no | |
| Source: Saint Consulting | |||
HITTING A POTHOLE
Suddenly retail REITs haven't been doing so hot. Most are off 52-week highs and all but four retail REITs were down for the year as of late June. Still, every retail REIT is trading above its 52-week high.
| Symbol | Price* | 52-week High | Chg | 52-week Low | Chg | 31-Dec-06 | YTD Chg | |
|---|---|---|---|---|---|---|---|---|
| PREIT | PEI | $43.97 | $50.39 | -12.74% | $37.48 | 17.32% | $39.38 | 11.66% |
| Acadia Realty Trust | AKR | 26.69 | 28.75 | -7.17 | 21.92 | 21.76 | 25.02 | 6.67 |
| Kite Realty Group | KRG | 19.10 | 21.80 | -12.39 | 14.13 | 35.17 | 18.62 | 2.58 |
| General Growth Properties | GGP | 52.75 | 67.43 | -21.77 | 42.56 | 23.94 | 52.23 | 1.00 |
| Equity One Inc. | EQY | 26.46 | 29.51 | -10.34 | 20.25 | 30.67 | 26.66 | -0.75 |
| Taubman Centers | TCO | 50.15 | 63.87 | -21.48 | 36.69 | 36.69 | 50.86 | -1.40 |
| Glimcher Realty Trust | GRT | 25.73 | 29.69 | -13.34 | 23.08 | 11.48 | 26.71 | -3.67 |
| The Macerich Co. | MAC | 83.10 | 103.59 | -19.78 | 67.90 | 22.39 | 86.57 | -4.01 |
| Capital Lease Funding | LSE | 11.13 | 12.21 | -8.85 | 10.16 | 9.55 | 11.60 | -4.05 |
| Tanger Factory Outlet Centers | SKT | 37.42 | 43.56 | -14.10 | 30.30 | 23.50 | 39.08 | -4.25 |
| Ramco-Gershenson Properties Trust | RPT | 35.83 | 39.55 | -9.41 | 26.17 | 36.91 | 38.14 | -6.06 |
| Agree Realty Corp. | ADC | 32.23 | 36.46 | -11.60 | 31.14 | 3.50 | 34.37 | -6.23 |
| Simon Property Group | SPG | 94.95 | 123.96 | -23.40 | 79.07 | 20.08 | 101.29 | -6.26 |
| Realty Income Corp. | O | 25.33 | 30.36 | -16.57 | 21.25 | 19.20 | 27.70 | -8.56 |
| Inland Real Estate Corp. | IRC | 17.01 | 21.14 | -19.54 | 13.83 | 22.99 | 18.72 | -9.13 |
| Federal Realty Investment Trust | FRT | 76.84 | 98.92 | -22.32 | 66.05 | 16.34 | 85.00 | -9.60 |
| Weingarten Realty Investors | WRI | 41.39 | 52.30 | -20.86 | 37.06 | 11.68 | 46.11 | -10.24 |
| Urstadt Biddle Properties Inc. | UBA | 17.13 | 19.73 | -13.18 | 14.62 | 17.17 | 19.09 | -10.27 |
| Regency Centers Corp. | REG | 70.10 | 93.49 | -25.02 | 59.18 | 18.45 | 78.17 | -10.32 |
| Feldman Mall Properties | FMP | 11.14 | 13.00 | -14.31 | 10.10 | 10.30 | 12.45 | -10.52 |
| Vornado Realty Trust | VNO | 109.23 | 136.55 | -20.01 | 93.53 | 16.79 | 122.35 | -10.72 |
| Cedar Shopping Centers Inc. | CDR | 14.18 | 18.42 | -23.02 | 13.84 | 2.46 | 15.91 | -10.87 |
| Kimco Realty Corp. | KIM | 39.17 | 53.60 | -26.92 | 35.07 | 11.69 | 44.95 | -12.86 |
| CBL & Associates Properties | CBL | 36.80 | 50.36 | -26.93 | 36.06 | 2.05 | 43.35 | -15.11 |
| Developers Diversified Realty Corp. | DDR | 52.11 | 72.33 | -27.96 | 49.27 | 5.76 | 62.95 | -17.22 |
| Cousins Properties Inc. | CUZ | 29.16 | 40.75 | -28.44 | 28.62 | 1.89 | 35.27 | -17.32 |
| Saul Centers | BFS | 45.12 | 61.70 | -26.87 | 36.74 | 22.81 | 55.19 | -18.25 |
| Colonial Properties Trust | CLP | 36.05 | 51.69 | -30.26 | 35.36 | 1.95 | 46.88 | -23.10 |
| * As of 6/22/2007 Source: Retail Traffic research |
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MARKETS TO WATCH: U.S. VERSION
Sperry Van Ness released the retail edition of its annual Top 10 Markets to Watch Report, examining economic factors that impact future investment in retail real estate. Here are its findings with some of the top reasons they were selected from a pool of more than 60 primary, secondary and tertiary markets.
| MARKET | KEY PLUSSES |
|---|---|
| Albuquerque, N.M. | Projected 1.63 percent increase in population and job growth of 2.2 percent in 2007. |
| Charleston, S.C. | A 5.36 percent increase in household income and a 1.63 increase in population in 2007. |
| Dallas/Ft. Worth | Expected to see 1.2 million square feet of absorption, 1.4 million square feet of retail construction completions and a nearly $0.40 per square foot per year effective rent increase. |
| Houston | Has identical metrics as Dallas, with projected 1.2 million square feet of absorption, 1.4 million square feet of retail construction completions and a nearly $0.40 per square foot per year effective rent increase. |
| Las Vegas | With 72,000 new residents expected in 2007, Las Vegas has the most impressive population increase of any of the top markets. |
| Phoenix | Projected 1.89 million square feet of new retail space expected to be completed and 1.59 million square feet expected to be absorbed. |
| Raleigh/Durham, N.C. | Per capita income is expected to increase 6 percent for the next few years. Landlords are expected to be able to achieve effective rent increases of 3.1 percent in 2007. |
| Salt Lake City | Significant population growth has prompted redevelopment and repositioning of retail centers of all sizes. |
| Tucson, Ariz. | At 7.49 percent, Tucson has the largest household income increase in the markets. |
| West Palm Beach, Fla. | Enjoys stronger fundamental gains over national averages highlighted by annual household income projected to grow to more than $131,000. |
| Source: Sperry Van Ness | |
MARKETS TO WATCH: INTERNATIONAL VERSION
AT Kearney released its updated Global Retail Development Index, which it calculates by weighing four variables: country risk, market attractiveness, market saturation and time pressure. India and Russia remained the top two markets. China jumped from 5th to 3rd and Malaysia jumped from 14th into the top 10. The biggest drops were suffered by former Soviet bloc nations like Slovenia and Croatia.
| Country | GRDI Score | 2007 Rank | 2006 Rank | Change |
|---|---|---|---|---|
| India | 92 | 1 | 1 | 0 |
| Russia | 89 | 2 | 2 | 0 |
| China | 86 | 3 | 5 | 2 |
| Vietnam | 74 | 4 | 3 | -1 |
| Ukraine | 69 | 5 | 4 | -1 |
| Chile | 69 | 6 | 6 | 6 |
| Latvia | 68 | 7 | 7 | 0 |
| Malaysia | 68 | 8 | 14 | 6 |
| Mexico | 64 | 9 | 19 | 10 |
| Saudia Arabia | 64 | 10 | 17 | 7 |
| Tunisia | 64 | 11 | 11 | 0 |
| Bulgaria | 63 | 12 | 21 | 9 |
| Turkey | 62 | 13 | 10 | -3 |
| Egypt | 61 | 14 | 20 | 6 |
| Morocco | 60 | 15 | 28 | 13 |
| Thailand | 59 | 16 | 12 | -4 |
| Slovenia | 58 | 17 | 8 | -9 |
| United Arab Emirates | 57 | 18 | 16 | -2 |
| Croatia | 56 | 19 | 9 | -10 |
| Brazil | 56 | 20 | 27 | 7 |
| Uruguay | 56 | 21 | N/A | N/A |
| Peru | 55 | 22 | N/A | N/A |
| Philippines | 54 | 23 | N/A | N/A |
| Indonesia | 52 | 24 | N/A | N/A |
| Algeria | 51 | 25 | N/A | N/A |
| Hungary | 51 | 26 | 23 | -3 |
| Romania | 50 | 27 | 22 | -5 |
| Lithuania | 50 | 28 | 26 | -2 |
| Argentina | 50 | 29 | N/A | N/A |
| Colombia | 47 | 30 | 29 | -1 |
| Source: AT Kearney | ||||
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