It might not always be a smooth path, but the good news is that we are walking it: at the time of writing, over a third of Americans have received at least one dose of a Covid-19 vaccine. The current administration is (as of late March) targeting to complete some 200 million Covid-19 vaccinations by the end of April 2021.
This is giving consumers hope for a better year, an uptick in Spring, and a whole swing in the right direction come Summer. Other positives include the impact of the stimulus checks and a sense of “normal” on the horizon. Combined, this is already starting to affect consumer spending positively – music to the ears of both retailers and retail properties managers.
It is not just us basking in this moment of light: As Bisnow writes:
“Stimulus checks, warmer weather, loosening coronavirus pandemic restrictions, and a brisk pace of Covid-19 vaccinations are all combining to spur a surge in consumer spending that might make 2021 a record-breaker.”
Spending Growth
JP Morgan’s U.S. economics team tracks card spending, and their latest info (chart below) shows a marked rise compared to a year ago, and even a small increase from pre-Covid days (remember those?).
The National Retail Federation (NRF) annual forecast (released in February) has predicted sales growth of between 6.5% and 8.2% in 2021 and expects retail sales to exceed $4.33 trillion. They cite pent-up demand as people want to get out and about, despite the boom in e-commerce.
And this tracks nicely with our own predictions for the year, in which Leasing Representative Michael Leon said:
“I expect that there will be a bounce-back, as there is significant pent-up demand for a return to normalcy, but our public health authorities also advise that some social distancing protocols will remain in place as the vaccine is rolled out. As such, I would say there will be a mixture of the two.”
Thankfully, this return to “real world retail” doesn’t spell doom for the “e-tailers”. The NRF also expects online sales to grow by a whopping 18-23% this year.
Insights from ICSC
If you are looking for more data and insight on consumer spending, ICSC hosted a webinar for members on this topic, featuring Stephanie Cegielski, Vice President, Research and Public Relations, ICSC. The presentation is available to members here.
Brokerage Busy-ness
We also see optimism reflected in new business. There are plenty of new business opportunities available. The Rappaport brokerage team have signed a significant number of new leases, and we’ve had several new retail openings already on the books, including…
New Openings
- CVS has become the first retailer to open at Skyland Town Center in Southeast D.C., occupying a 10,000 SF space facing Good Hope Road SE.
- Marshall’s recently opened its doors at Bull Run Plaza in Manassas.
New Leases
- Numerous small shop and tenant representation leases for clients such as Chipotle, Raising Cane’s, and Sephora
- Furthermore, new to Village at Leesburg is Bandit Taco, offering artisanal tacos and other Mexican food favorites like burritos and quesadillas.
- Park Potomac is welcoming King Street Oyster Bar, which specializes in oysters – naturally – but offers an array of seafood, including shrimp, clams, fish, and crab.
- Skyland Town has five new confirmed leases! Soon Roaming Rooster, Mezeh, and Tropical Smoothie Cafe will be joining CVS, Lidl, and Starbucks.
New Deals
- March 2021 really was a stellar month. Not only was there a 66% increase in transactions year-on-year, it was also the third-highest transaction [volume/value] calendar month in ten years.
One for the Books
Additionally, consumer confidence is up, according to the University of Michigan’s consumer survey, by around 8% in March – nearing but not yet meeting pre-pandemic levels. Overall, the sentiment seems to be that we should be gearing up for a record spending year.
