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thc~ntsrlves to work and another 10°~o carpool..
<br />That mcanv the $700 increase will affect 1.5
<br />millionpeople in. doe twin. Cittes, or shift over
<br />51,054,000,000 to has instead of oilier retail.
<br />To put this in perspective, Cub Foods had. an
<br />cstiutated ~1,0~4,8t~0,000 in ,des last year. In
<br />otl~ter words, all sales from (_-ub Foods would.
<br />go a~=; at rc, coniprns:rte for the X1.00 tncrease
<br />itt gas. t ?r to i:?ur it another way Lrrgel'S atuutal
<br />revenue. iu 200 ( was 5(i3, {6 (,000,000 and if
<br />you average that over their 1,59] ;tones you get
<br />just under $40 million dollars in revenue per
<br />st<}rc, or wiping out Zfi of the 52 Target stores
<br />in the metro area.
<br />The small shop user can be l~tit even harder.
<br />Accordim.; to Dollars and Cents for Sltopphlg
<br />Centers the average retailer grosses ~+_'S0 per
<br />square foot. Eliminating over a billion dollars
<br />in revenue would take away 4.2 rttilbota Sh of
<br />retail space. Lhat would more than double the
<br />rr:ntil vacancy in the Twin Cities.
<br />Ilot calct.tlat:ed in this figure is the multiplier
<br />effect. It is estimated that each dollar s~~eiit on
<br />retail generates X0.57 in additional econonuc
<br />aa:ivit:y. -That works ont to lie a multiplier of
<br />around 2.3, so the. overall impact is more than
<br />just the billion dollats.
<br />~'~1ltile these numbers may seem 1ar~e and
<br />alarming, they only tacxor-in working driviti;
<br />adults. If you factor ul the non working drivt~~rs
<br />like spouses, students, retired persons, ur the
<br />unenti?loyed, Chew numbers would increase and
<br />be nior~-dratnatic.
<br />This analysis does not t~+cus cot outer rapidly ris-
<br />ing priced items such as food. Food w•c cannot
<br />live without, bur can adjust our spending robe
<br />store value conscious. Regardless, food. prices
<br />are escalating touch faster Chan wage increases,
<br />putting additional pressure on discretionary
<br />spending.
<br />~~'here does this leave. t:hr° average consunu r' It
<br />leaves dtertrpondering Che question, where dc,e_s
<br />trty ~; 00 i:onte from.'
<br />Where does rltis leave the metro retail real
<br />estate market? -I-here will be a Callout of tale
<br />weakest retailers and a drop in sales that rely
<br />on di,ct tionary =_>endin,:Y.
<br />Fot- shopping center owners, the data .ubgesls
<br />staying close to your tenants and supporting
<br />them. It reinttrcx:s wb.at we have been seeitt};
<br />.and saying about: retatlers approaching expan-
<br />sion and growth with extreme cauC,ion.
<br />"I'hc "l win Cities retail tirarket experienced nega-
<br />tive absorption for the second quarter c~ 2008
<br />with 46,22; S'f^. Vacancy remainx:dunchanged
<br />at S. j{r,-,
<br />All but three submarhets had n..tarive absorp-
<br />tion, with the lamest being Anoka county
<br />with a negative 35,99 % tiF~. Tl e West h;ad the
<br />most absorption wii:h 26,433 SF and vacancy
<br />remained the lowest with 2.3°io. Scott County
<br />has the highest vacancy ar 81'%x.
<br /> NET VACANCY RATE VACANCY
<br />SECTOR INVENTORY ABSORPTION Q4/07 QI/08 CHANGE
<br />Anoka County 8,414,054 -35,997 4.5% 5.0% 0.5%
<br />Dakota County 8,546,847 14,116 4.9% 4.7% -0.2%
<br />Minneapolis 3,986,521 -3,946 6.6% 6.7% 0.1%
<br />Northeast Sector 7,373,080 -30,904 6.1% 6.5% 0.4%
<br />Northwest Sector 9,696,023 5,323 7.3% 7.2% -0.1%
<br />St. Paul 2,760,901 -11,174 5.4% 5.8% 0.4%
<br />Scott County 2,088,975 -350 8.1% 8.1% 0.0%
<br />Southwest Sector 12,195,848 -9,426 4.9% 5.0% 0.1
<br />Washington County 4,785,609 -302 4.3% 4.3% 0.0%
<br />West Sector 7,283,982 26,433 2.7% 2.3% -0.4%
<br />Twin Cities Metro 67,131,840 -46,227 5.3% 5.3% 0.0%
<br />PROPERTY NAME TENANT
<br />CITY, STATE SF
<br />Woodbury Village Green Gold's Gym Woodbury, MN 39,520
<br />University IV Empire Education Spring Lake Park, MN 9,089
<br />Ramsey Commons Shopping Center US Bank National Association Ramsey, MN 3,200
<br />Advanced Auto Savage Retail Midwest Cellular Savage, MN 2,800
<br />Tamarack Square Midwest Cellular Fergus Falls, MN 2,460
<br />Shingle Creek Center Midwest Cellular Brooklyn Center, MN 2,100
<br />Cobblestone Lake Midwest Cellular Apple Valley, MN 1,854
<br />Rosedale Square Shopping Center Zpizza Roseville, MN 1,680
<br />~; ~, ~ C
<br />PROPERTY NAME CITY, STATE $/SF YEAR BUILT
<br />Walgreens Minneapolis, MN $329 1997
<br />CVS Farmington, MN $299 2007
<br />Village on the Ponds Chanhassen, MN $205 1999
<br />Savage Town Square Burnsville, MN $161 2003
<br />LA Fitness Site St. Louis Park, MN $154 1979
<br />Humboldt Square Shopping Ctr Minneapolis, MN $96 1973
<br />401 1st Ave N Minneapolis, MN $72 1914
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