This week in the Retail Roundup, CoStar reports on expansions or new concepts at Wal-Mart, Barnie's Coffee & Tea, T-Mobile and Mama Fu's; new retail developments in VA, CA, MI and NV; acquisition, merger, loan or sale activity at CVS and Longs, Applebee's, American Realty Capital Trust and PNC Bank, Cedar Shopping centers; closings, cutbacks or bankruptcies at Circuit City, Office Depot and Walgreens; personnel announcements at Isram Realty Holdings, Regency Centers, and Dillard's; and more.

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Did you miss last week's CoStar Advisor national retail story, "Target Considering Spinning-Off Real Estate into New REIT", which included details on Pershing Square's proposal? If, follow this link to read the story.

Did you miss last week's CoStar Advisor national retail story, "General Growth Puts Las Vegas Gems on the Block, Appoints Interim CEO & President", which included analyst and brokerage community commentary? If, follow this link to read the story.

ICSC Predicts 148,000 Retail Establishments Will Shutter in 2008
In an Oct. 31 Retail Business Conditions Report, the International Council of Shopping Centers (ICSC) said that store closure announcements were up to 4,632 so far this year; which is already higher than full-year announcements for 2005 (4,269) and 2007 (4,603).

According to ICSC, apparel stores account for 26.4% of the closure announcements, followed by Jewelry (18.1%), Home Entertainment (17.6%), Food and Beverage (14.5%) and Home Furnishings (6%).

ICSC forecasts that the number of announced-store closings will rise to approximately 6,100 for 2008 and exceed 3,100 during first-half 2009.

Modeling its own data on major store closings announced against the Bureau of Labor Statistics' record of actual store closures, ICSC projects that approximately 148,000 retail establishments will be shuttered in 2008 and another 73,000 stores will close in the first half of 2009. The 2008 estimate would be the largest since 2001, when there were 151,000 stores shuttered, said ICSC.

In this report, ICSC estimated the retail industry job loss impact these store closures would have. "If the average number of jobs-lost-per-store-closed remains constant with 2007 (4.2 jobs per establishment) for 2008 and 2009 that would translate into about 625,000 retail jobs eliminated in 2008 with little change in the pace for early 2009. On the other hand, if the number of jobs lost per store mirrors the 2001-recession experience (5.4 jobs per establishment) that could mean nearly 800,000 retail jobs pared in 2008 and, again, little change in the annual rate for first-half 2009," wrote ICSC.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@CoStar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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EXPANSIONS / NEW CONCEPTS

Wal-Mart Reveals New Warehouse Club Concepts
At an investor conference last week, Wal-Mart's warehouse club division announced plans to open the first "Mas Club" store in Houston in 2009. The new concept store, aimed at Hispanic consumers and business owners, is a spin-off of Sam's Club warehouses that will offer a larger selection of imported products Hispanics typically seek. Wal-Mart's 143,000-square-foot prototype for the concept also makes room for an outdoor sales area and gas station.

The company continues to test its first Sam's Club Business Center, intended exclusively for business customers, in Houston -- the store opened this past summer. In Garden City, Kansas, the company is testing a 100,000-square-foot small format Sam's Club that would poise the company for growth in smaller markets.

Mama Fu's New Owners Hope to Grow to 100 Units in Five Years
Austin, Texas-based Murphy Adams Restaurant Group closed on the acquisition of Asian fast-casual concept, Mama Fu's, from Atlanta-based multi-brand franchise company, Raving Brands, in March.

The buyer was already the largest Mama Fu's franchisee, with five units in TX, AK, and FL. At the time of the acquisition, there were 17 Mama Fu's restaurants in operation; now the company lists only 12 restaurant locations on its website.

At the time, the new owners said they intended to grow Mama Fu's to a 100-unit chain over the next five years, with locations primarily in the Southeast. But according to an October story by BizJournals, Murphy Adams is now aiming for 150 units by the end of 2013.

The group plans to focus on medium to small-sized cities where the real estate is a little more affordable, such as Mobile, AL; Savannah, GA; Chattanooga, TN; Birmingham, AL; Tulsa, OK; and more.

Barnie's Coffee & Tea Taking Advantage of Former Starbucks Stores
In Central Florida, Barnie's Coffee & Tea is taking advantage of Starbucks recent pare-down of stores. The regional coffeehouse chain said it would open more than 12 stores throughout Florida that were once Starbucks locations; most of them are located in malls. In total, the company plans to convert a total of 20 former Starbucks stores in Barnie's locations.

New Barnie's stores are likely to open at Seminole Towne Center, Altamonte Mall, Orlando Fashion Square and Florida Mall in the Orlando area; Indian River Mall and the Pavilion at Port Orange on the Coast; Lakeland Square Mall and in The Villages at Buffalo Ridge.

T-Mobile Opening New Stores in Chicago Area
Mobile phone retailer and service company, T-Mobile, continues to sign new leases. Meredith Oliver, principal at METRO Commercial Real Estate Chicagoland, recently represented T-Mobile in securing four new locations throughout the Chicago area. Specifically, a 2,958-square-foot store will open at Elston Ave & Logan Blvd.; a 3,400-square-foot store will open at Roosevelt Rd & Highland Ave in Lombard; a 2,500-square-foot store will open at Rte 83 and Hook Rd in Round Lake Beach; and a 2,400-square-foot store will open at Rte. 83 and Plainfield Rd in Willowbrook.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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NEW SUPPLY

Regency Centers' Celebrates Opening of Wegmans at The Shops at Stonewall
Regency Centers (NYSE: REG) is has completed The Shops at Stonewall, a 318,000-square-foot power center located atop 37 acres at Lee Highway and Old Carolina Road in Prince William County, VA.

The center is anchored by a 140,000-square-foot upscale Wegmans supermarket (grand opening Nov. 2) and also includes Staples, Michaels, Ross Dress For Less and Bed, Bath & Beyond as junior anchors. Other retailers scheduled to open soon include Wink Optometry, The Athlete’s Foot, Bubbles, Escape Salon & Day Spa, Bertucci’s Restaurant, Suntrust Bank and Middleburg Bank.

The center's design includes a Wegmans’ iconic clock tower as the central landmark that complements brick and stone architectural elements and lighting features.

Continental's Streets of Brentwood Lifestyle Center Now Open
Continental Real Estate Companies opened The Streets of Brentwood lifestyle center on Oct. 24. The 410,000-square-foot project is located at the intersection of Sand Creek Road and State Highway 4 in Brentwood, CA; part of the Bay Area.

Located on 54 acres, the center boasts more than 60 upscale tenants, including a 14-screen Rave Motion Pictures, REI (opening spring 2009), Tilly's, DSW, Aeropostale, American Eagle, Banana Republic, Victoria's Secret, Maggie Moo's, Swarovski, Hollister, Limited Too, Gymboree, Rocky Mountain Chocolate Factory, Talbot's, and many more. Restaurants include Rubio's, Red Robin, Salad Makers, and more.

Ramco Provides Updates on Hartland Towne Square, Gateway Commons and Northpointe Town Center
Ramco-Gershenson Properties Trust (NYSE:RPT) provided an update on its development activity in its recent third quarter report. The retail REIT has four major projects in its development pipeline.

Hartland Towne Square is a 500,000-square-foot shopping center in Hartland, MI in which the company has a 20% interest. Meijer closed on 21.8 acres of land at the project in March 2008 and is under construction on a 192,000-square-foot grocery store. In addition, Menards is scheduled to close first quarter 2009 on the 16.8 acres of land for its 162,000-square-foot home improvement store. Additionally, Ramco said it signed a 30,000-square-foot junior anchor to the center, although it did not reveal the tenant's identity.

Ramco is seeking approval from the city of Lakeland, FL for Gateway Commons, a 375,000-square-foot center. The company expects entitlements to be complete by the end of second quarter 2009 and at that time, Ramco hopes the center is 60% spoken for by tenants; at that point Ramco plans to form a joint venture for the project.

In Jackson, MI, Ramco is in the preliminary planning and entitlement stage on Northpointe Town Center, a 550,000-square-foot project.

Juliet / Inland Celebrate Grand Opening of Lake Mead Crossing Phase One
Anchored by a 151,000-square-foot Target that opened in July, Lake Mead Crossing also includes Sportsman's Warehouse (held its grand opening in September); and Marshall's, Ross, PETsMART, Famous Footwear, Rack Room Shoes, and other national tenants that will open in later phases.

The power center is located at the northwest corner of Lake Mead Parkway and Water Street in downtown Henderson, Nevada. Lake Mead Crossing broke ground in May 2007 -- so far, 260,000 square feet of the project is complete. Phase two, scheduled to open spring 2009, will include six buildings totaling 122,000 square feet. The center should total 725,000 square feet at full completion, expected in 2010.

The project is part of a joint venture between Inland Western Retail Real Estate Trust as equity partner and Juliet Companies as developer. The two announced a $500 million joint venture in January to develop retail centers in major MSAs throughout the Western U.S.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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ACQUISITION/MERGER/SALE/LOAN ACTIVITY

Collapse of Capital Markets Blamed for Termination of $128.9M Cedar-Homburg Deal
In early spring, retail REIT Cedar Shopping Centers (NYSE:CDR) entered into a preliminary agreement with Homburg Invest, Inc. to contribute 32 properties owned by Cedar, valued at $128.9 million and totaling slightly more than 1 million square feet, into a joint venture between the two.

Under terms of the agreement, Homburg was set to acquire anywhere from a 49.9% to 80% interest in the 32 properties, while Cedar would retain the remaining interests. Cedar would handle ongoing property management and leasing of the portfolio and receive fees for those services. At the time, the companies said a $55.1 million first mortgage at 5.6% had been arranged for the transaction -- Homburg was to invest $50 million in equity.

The joint venture agreement was axed, according to a Nov. 3 announcement. Homburg notified Cedar that it would not proceed with the joint venture, despite being near completion on the physical, financial and legal due diligence on the properties. Homburg "cited the unprecedented current events that have taken place in the U.S. capital markets and the virtual collapse of the world capital markets as the basis for its decision,” said Cedar.

American Realty Capital to Acquire 50 PNC Bank Branches
American Realty Capital Trust (ARCT) has secured $33 million in mortgage financing from TD Bank, N.A. to acquire 50 bank braches triple-net leased to PNC Bank. The transaction is scheduled to close by the end of this year. The effective interest rate on the loan is 4.9% and it is set to mature Oct. 31, 2013. The PNC Bank branches are located in Pennsylvania, New Jersey and Ohio and total 275,000 square feet.

On Sept. 29, 2008, the REIT closed on the acquisition of six drugstore properties net-leased to Rite Aid for $18.8 million, which included $12.8 million in assumed debt. The Rite Aid stores total 75,000 square feet and are located in Ohio and Pennsylvania.

CVS Completes Acquisition of Longs Drug Stores; Becomes Largest Drug Store Chain in the Country
CVS Caremark Corporation (NYSE: CVS) completed its $2.9 billion acquisition of Longs Drug Stores (NYSE: LDG) on Oct. 30, 2008. CVS now controls Longs' 521 drugstores in California, Hawaii, Nevada and Arizona as well as its pharmacy benefits management service, Rx America. The deal makes CVS the largest drugstore chain in the company, surpassing long time rival Walgreens. CVS is now up to 6,800 stores, which compares to Walgreens' 6,479 stores.

DineEquity Sells 66 Restaurants to Franchisees
DineEquity, Inc. (NYSE: DIN), franchisor and operator of Applebee's Neighborhood Grill & Bar and IHOP Restaurants, is selling 66 company-operated Applebee's restaurants located in Houston (22), Dallas (37), and Albuquerque (7), as a continuation of its strategic plan to operate Applebee's as a fully-franchised company, selling company-operated restaurants to franchisees. The Dallas and Houston transactions are scheduled for completion by the end of this year, while the Albuquerque deal is scheduled to close first quarter 2009.

Additionally, the company announced the successful completion of the sale of 15 company-operated Applebee's restaurants in Nevada. Earlier this year, Applebee's closed the sale of 29 company-operated restaurants in Southern California and Delaware, which brings total restaurants sold or pending sale to 110 locations to date.

DineEquity estimates its after-tax cash proceeds related to the sale of the 110 restaurants at $63 million. In addition, the company has assigned to the franchisees $50 million in sale-leaseback rent obligations related to the 110 restaurants.

"We are actively negotiating with several interested buyers for each of Applebee's remaining company-operated restaurants available for sale. While the chill in the credit markets presents a meaningful challenge to our refranchising efforts, we believe the issues resulting from the credit crisis are not insurmountable," said DineEquity management in a statement.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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CLOSINGS/CUTBACKS/BANKRUPTCIES

Circuit City Closing 155 Stores; Going to Landlords to Reduce Rent on Others
Circuit City Stores, Inc. (NYSE: CC) announced today, Nov. 3, the immediate closure of 155 U.S. stores. The country's second-largest electronics retailer blamed the move on its "deteriorating liquidity position" and the "continued weak macroeconomic environment." Circuit City is also reducing future store opening plans and said it will put pressure on landlords by "aggressively renegotiating certain leases." Further, the retailer said it is considering "all available options and alternatives to restructure its business."

Circuit City said the 155 stores being closed are all underperforming or are "no longer a strategic fit for the company" and generate $1.4 billion in annual net sales. As a result of the closures, the retailer will exit 12 U.S. markets. Follow this link for Circuit City's list of closed stores. States subject to the most store closures include Arizona, California, Georgia, Illinois, New York, Ohio and Florida.

The stores will not be open on Nov. 4, but will reopen on Nov. 5 in liquidation mode; the sales will continue through the holiday season; but Circuit City said doors would shutter no later than Dec. 31, 2008. The store closures will result in a reduction of approximately 17% of Circuit City's U.S. workforce and will leave the retailer with 566 U.S. stores.

While Circuit City established its go-forward "The City" 20,000-square-foot prototype store last year, the retailer's average existing store is about 34,000 square feet, according to CoStar Tenant. Therefore, this closure of 155 stores could translate into more than 5.2 million square feet of retail space being vacated.

The retailer is canceling the opening of 10 stores that were scheduled to open this year and will only open two "incremental" stores during the remainder of this year. In addition, it will not open any new stores during 2009. Previously, Circuit City had targeted the opening of 38 to 45 new stores in 2008 (through second quarter it had opened 20 of them); it opened 43 new stores in 2007.

More store closures are likely in the cards for the retailer, as a certain percentage of landlords are likely to reject Circuit City's attempts to renegotiate leases with the intention of "significantly lowering rents." The retailer said it might exit leases if rents aren't reduced. Circuit City plans to work with landlords to terminate leases for the stores being closed, as well as "leases for a number of inactive locations that were closed previously and for the locations that are no longer being opened."
For the full CoStar story on the Circuit City announcement, follow this link.

Office Depot Foreshadows Store Closures in CA and FL; Sale-Leaseback Possibility
In its recent third quarter earnings call, Office Depot said it will be evaluating its store base for potential closures. The office supply retailer would not disclose the number of stores it might close, but said it may incur costs from cancelling future lease commitments. Further, Office Depot will consider potential sale-leaseback transactions.

Steve Odland said, "If these were normal economic times, we probably would be closing no stores, because those stores would be cash flow positive and growing nicely. In this economic time and with an uncertain future...economists are projecting that this...situation is going to last through 2009 and is going to take until the beginning of 2010. We don’t know whether that’s reality or not, but we have to assume that 2009 is going to look a lot like the back part of 2008. If that’s the case, then it simply does make sense to close stores and maybe shrink in our size a little bit before we start growing again." Odland added that the company thinks it is "overexposed" to Florida and California.

Walgreens to Cut Costs and Capital Investment
At an analyst day held Oct. 30 in Chicago, the country's second-largest drugstore chain, Walgreens (NYSE: WAG) (NASDAQ: WAG) outlined a strategic plan to strengthen its core business.

Walgreens highlighted seven key initiatives: Slow store growth; shift promotions to need-based items and broaden private label product offerings; reduce the cost of filling prescriptions; open Take Care health clinics to 200 stores by the end of 2009; expanding its specialty pharmacy business; reducing costs by $1 billion through fiscal 2011, which includes reducing corporate overhead and work throughout stores; and cutting capital investments by $400 million to $1.8 billion in fiscal 2009.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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PERSONNEL ANNOUNCEMENTS

Moschowitz Joines Isram Realty Holdings as CEO; Set to Acquire Class B Centers
Shai Moschowits was recently named CEO of Hallandale, FL-based Isram Realty Holdings. Prior to Isram, Moschowits led the redevelopment of more than 25 retail properties at Woolbright Development where he handled asset, property and construction management, entitlements, acquisitions and capital structuring. Moschowits has alos served as an investment banker at Rodman & Renshaw and a senior consultant with Grant Thornton International. Once a New York public accountant, Moschowits holds a BBA in Public Accounting from Hofstra University and is a licensed real estate broker in Florida.

Isram currently owns, leases and manages 1.5 million square feet of neighborhood and community shopping centers in Florida including Naples, Tampa, Bradenton, Jacksonville, Orlando and Merritt Island.

Moschowits will lead a new strategic alliance the company formed with Fimiani Development to actively pursue the acquisition and leasing of Class B shopping centers throughout Florida, with an eye for improving the properties through enhanced leasing, redevelopment and intensive management.

Regency Centers Promotes Koleszar to VP, Regional Officer
Jacksonville, FL-based Regency Centers recently promoted Andre Koleszar to vice president, regional officer, stationed in the company's Atlanta office. In this capacity, Koleszar will be in charge of the property management and leasing departments for 36 operating properties and four developments in process.

Koleszar started at Regency in 2005 as a retail leasing agent in South Florida; he then took on greater responsibility in the company's Raleigh office and was promoted to senior leasing agent in 2007. Prior to Regency, Koleszar was responsible for transactional real estate on the national level for a private real estate holding firm in New York. He holds a Bachelor of Science degree from Tulane University in New Orleans, LA.

Dillard's Shareholders Vie for Management's Ousting; Company Responds
On Oct. 31, Dillard's (DDS: NYSE) formally responded to negative press and activist shareholder comments regarding the company's financial strength. The Little Rock, AK-based department store retailer said it is operating its business "conservatively in light of the near-term economic uncertainty." The company currently operates about 300 stores.

Dillard's shared the following highlights: it maintains a $1.2 billion revolving credit facility that it expects will always maintain at least $500 million in availability; following its pay-off of $100 million in debt on Nov. 15, Dillard's said it would have only $26 million in long-term debt coming due over the next two years; the company plans to close more stores in 2009, which results in lower working capital requirements -- it had already closed 20 stores this year; in 2009, the company will open only two new stores, compared to 10 it opened this year; lastly, Dillard's predicts a $50 million reduction in advertising, selling, administrative and general expenses this year.

A letter from activist shareholders was recently filed with the SEC arguing for the ousting of Dillard's management. Specifically, Barington Capital and Clinton Group said Dillard's "overpaid and under-qualified" management, specifically CEO Bill Dillard Jr. and president Alex Dillard, could be "readily replaced by more talented" retail industry professionals. The shareholders apparently weren't satisfied by Dillard’s naming four new members to its board in May. Dillard's comparable store sales have declined for the past 10 years, under CEO Dillard's watch.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

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SUSTAINABILITY/ GREENING

Talbert Develop Building Green Retail Centers in CA
Burbank, CA-based Talbert Development plans to open The Shoppes at La Quinta, a "green" retail center to be built in the Coachella Valley July 2009. The 50,000-square-foot center, located at the corner of Washington Street and Avenue 48 in La Quinta, will feature a cool roof, fueling stations for electric cars, highly efficient HVAC, low E2 double-pane windows, highly insulated walls, drip irrigation, and more. Talbert plans to pre-certify the project under Gold LEED standards and said it will be built to use 20% to 40% less energy over the typical comparable building.

Talbert plans to break ground this December on The Shoppes of Rancho Mirage, located just off Highway 111 and Country Club Drive in Rancho Mirage. The company also plans to achieve LEED certification on this project; features include the use of low-VOC paints and sealants, low-flow fixtures, and more.

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(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.