The ICSC RECon show in Las Vegas, which takes place every May, attracted 33,000 delegates this year. Renowned for hosting some of the industry’s biggest US names, it is where 25% of all the continent’s leasing deals are done. Noella Pio Kivlehan went along to speak to some of those exhibiting, get a feel for what is happening in the US market, and find out which US retailers the UK should be looking out for.
Touring ReCon 2014 in Las Vegas
With more than 33,000 delegates and 1m sq ft of exhibition space, RECon 2014 is the world’s biggest retail convention. Nick Egelanian, a RECon veteran of 25 years, and Charles Miller, both from retail consultant SiteWorks, which has now established itself in the UK (with Miller at its head), give an audio tour of show.
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Restaurant openings are back on the menu in the US market
Randall Hiatt, president of Fessel International and a former Walt Disney Company employee, said: “A lot of development is back on track in the US. During the recession people didn’t develop restaurants. We actually had negative expansion of restaurants, meaning we had more restaurants close than open. But now everybody is back, so it’s really a resurgence in restaurants.”
Among those expanding is the Lazy Dog Café; new chain Paul Martin, launched by Paul Fleming, who founded PF Chang; and Darden Restaurants, which has just sold seafood chain Red Lobster. “Darden is performing very well,” said Hiatt. “It is doing over $10m unit sales. There are a lot of companies, local and regional, that are expanding as people fill out their portfolios.”
Hiatt added that there were a lot of strong regional chains, as well as national. On top of that, the world of the celebrity chef is also driving expansion in the restaurant sector.
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Halloween pop-up heads to the UK
One of the most eye-catching stands at RECon 2014 gave delegates a welcome fright.
Spirit Halloween is a pop-up seasonal chain dedicated to the annual spook-fest, which is huge business in the US. Opening in August, and closing the day after Halloween on 1 November, the chain haunts 1,100 pop-ups across the US and Canada. Sites vary from 5,000 sq ft to 40,000 sq ft.
And the UK and Ireland could be getting a visitation soon.
Spirit Halloween senior manager Rick Osborn revealed that the company had already been scouting sites in the UK and Ireland.
“We just haven’t pulled the trigger yet,” Osborn said. “We could be very successful in the UK. To be there would be great, we just haven’t decided yet. But there’s availability, and I could see us doing it within the next couple of years.”
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Jersey Mike’s Subs wants bite of UK market
The UK is on the target list for one of the US’s fastest-growing food chains.
Jersey Mike’s Subs already has a total of 770 outlets in 38 US states, but it now has plans to expand internationally towards the end of the year, using franchisees.
Company president Hoyt Jones said: “We hope to be in all 50 US states and we’re now about to venture up to Canada. The next logical place might be London, or it might be Australia – another English-speaking country.”
Hoyt said the success of Subway, which operates in more than 80 countries, would help Jersey Mike’s Subs expand.
He added: “Subway did a fantastic job taking the sub sandwich around the world.”
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US retail bounces back
Retail has bounced back in the US – so much so that investors are finding it difficult to buy property.
“We have returned to a time when retail as a property type is in great demand,” said Kirstin Mueller, chief operating officer for retail at JLL. “You will hear an investor say they are underweight in retail today as they are looking to balance out the various property types.”
And what investors want is specifically grocery-anchored retail and trophy malls. But, Mueller said, the supply is not meeting the level of demand. There is also an increased demand for secondary malls.
This lack of supply has started to drive development, Mueller added.
Julie Steffen, senior vice-president of JLL’s international desk, said there had been an increase in the number of foreign investors who were strong in their own markets.
Steffen also noted Lidl’s proposed move into the US.
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Crowdfunding nets attention
Different types of funding for investing in properties were on show at RECon 2014 in Las Vegas.
One example was crowdfunding. “In its simplest form, it is pooling money from individuals on the internet,” explained Jilliene Helman, chief executive of Realty Mogul, which specialises in this type of scheme.
Helman’s company asks people for a minimum investment of $5,000 in properties that range from retail, office, industrial and residential. “Investors are owning a small share of an actual property,” she said.
Helman added that foreign investors – particularly from Asia, but also from Europe and the UK – were interested in her company, which is only a year old.
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