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Offline RE

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Fast Eddie on the Prowl again.

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Sears' Eddie Lampert looks to regain full ownership of Sears Hometown and Outlet Stores
Kelly Tyko, USA TODAY Published 9:45 p.m. ET April 8, 2019


Elizabeth Keatinge tells us about some new Sears stores that are opening after the company declared bankruptcy in 2018. Buzz60

The day after Sears announced three new small-format stores would open in May, the company made a move to reclaim full ownership of part of the company it spun off in 2012.

Illinois-based Sears Hometown and Outlet Stores announced Monday that it received a proposal Friday from its largest shareholder and Sears Holdings chairman Eddie Lampert's hedge fund ESL Investments to purchase the remaining shares of the company for $2.25 per share.

Lampert, ESL and its affiliates have a nearly 59% stake in the business, according to records Sears Hometown filed with the U.S. Securities and Exchange Commission.

The ownership offer is estimated at $21 million and a 23.6% premium, Lampert wrote in a letter to the Sears Hometown board of directors.

The start of a new Sears era?: The retailer announces openings, not closings

Store closings 2019: Payless, Gymboree and Victoria's Secret are just some of the brands closing stores

"We believe our proposal, which will provide certain value and liquidity at a considerable premium to the market price, presents a superior outcome for the Company’s stockholders as compared to the uncertain outcomes facing the Company if it continues on its current path as a stand-alone company," Lampert wrote.

The transaction would be financed with "cash or loans from ESL and our other members," Lampert said.

Lampert said ESL intended to proceed only if the full board approved the proposal "upon the recommendation of the special committee of independent directors that we understand has been formed to consider any proposal from us."
A firm controlled by Eddie Lampert has offered to buy the outstanding shares of Sears Hometown and Outlet stores he doesn't already own.

A firm controlled by Eddie Lampert has offered to buy the outstanding shares of Sears Hometown and Outlet stores he doesn't already own. (Photo: http://abcnews.go.com/)

In a statement on Monday, Sears Hometown and Outlet Stores said "the special committee concluded that a transaction on the terms contemplated by the Proposal would not be in the best interests of the Company's unaffiliated stockholders."

But, the statement said, "The parties are continuing discussions regarding potential transactions between the parties."

Sears has closed more than 3,500 stores and cut about 250,000 jobs in roughly the last 15 years as sales cratered, leading to the company's Chapter 11 bankruptcy filing last October.

The company was on the brink of liquidation, but Lampert’s hedge fund made a $5.2 billion offer for the company that was approved by a federal bankruptcy judge in February. About 425 stores and 45,000 employees were transferred to ESL.

Sears Hometown and Outlet Stores – which had  677 locations, including independent dealers and franchisees as of Feb. 2 – has been facing collateral damage from October’s Chapter 11 bankruptcy of the Sears department store chain.
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Offline azozeo

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World Trade Suffers Biggest Collapse Since Financial Crisis '08
« Reply #256 on: April 17, 2019, 02:07:14 PM »

The recent collapse in world trade volume is the worst since the financial crisis and as dangerous as during the dot-com bubble of the early 2000s, according to The Telegraph. Data from the CPB Netherlands Bureau for Economic Policy Analysis revealed that world trade volume dropped 1.8% in the three months to January compared to the preceding three months as a synchronized global downturn gained momentum.

https://www.zerohedge.com/news/2019-04-16/world-trade-suffers-biggest-collapse-financial-crisis


<a href="http://www.youtube.com/v/z5FjGiQZv7M&fs=1" target="_blank" class="new_win">http://www.youtube.com/v/z5FjGiQZv7M&fs=1</a>
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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Re: World Trade Suffers Biggest Collapse Since Financial Crisis '08
« Reply #257 on: April 17, 2019, 02:22:00 PM »

The recent collapse in world trade volume is the worst since the financial crisis and as dangerous as during the dot-com bubble of the early 2000s, according to The Telegraph. Data from the CPB Netherlands Bureau for Economic Policy Analysis revealed that world trade volume dropped 1.8% in the three months to January compared to the preceding three months as a synchronized global downturn gained momentum.

https://www.zerohedge.com/news/2019-04-16/world-trade-suffers-biggest-collapse-financial-crisis

<a href="http://www.youtube.com/v/z5FjGiQZv7M&fs=1" target="_blank" class="new_win">http://www.youtube.com/v/z5FjGiQZv7M&fs=1</a>

Heading downhill now!  Watch out for those Bumps!

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https://www.cnn.com/2019/04/16/business/store-closures-retail-bankruptcies/index.html

American retailers already announced 6,000 store closures this year. That's more than all of last year

By Nathaniel Meyersohn, CNN Business

Updated 1:27 PM ET, Tue April 16, 2019


SAN FRANCISCO, CA - APRIL 05: A pedestrian walks by a Payless Shoe Source store on April 5, 2017 in San Francisco, California. Kansas-based discount shoe retailer Payless Shoe Source has filed for Chapter 11 bankruptcy and will close nearly 400 of its stores. (Photo by Justin Sullivan/Getty Images)


New York (CNN Business)America has too many stores.

This year, US retailers have announced that 5,994 stores will close. That number already exceeds last year's total of 5,864 closure announcements, according to a recent report from Coresight Research.
Bankruptcies in the retail sector are piling up and chains have aggressively closed under-performing stores. That has led to an uptick in store closures this year.
Payless, Gymboree, Charlotte Russe and Shopko have all filed for bankruptcy this year and will close a combined 3,720 stores, according to the report. The majority of those are because of Payless, which filed for its second bankruptcy in February and said at the time it would shutter 2,100 stores in the United States.

Other retailers, such as Family Dollar, GNC (GNC), Walgreens (WBA), Signet Jewelers (SIG), Victoria's Secret and JCPenney (JCP), are struggling and are shrinking their store footprints to save money.
Family Dollar will close 359 stores this year, while Signet Jewelers, the parent company of mall stalwarts Kay, Jared and Zales, will close 159.

Even thriving retailers such as Target (TGT)and Walmart (WMT) are quietly closing a handful of their stores — although those companies are opening some, too. And department stores such as Nordstrom (JWN), Kohl's (KSS) and Macy's (M) are shuttering a few stores each.

Thousands more store closings could be on the way in the coming years as online shopping replaces purchases at physical stores.
"The flood of store closures will likely continue for quite some time," said Coresight Research CEO Deborah Weinswig.

Hundreds of old Sears stores are empty. Amazon and Whole Foods might move in
Hundreds of old Sears stores are empty. Amazon and Whole Foods might move in
Online sales make up around 16% of retail sales today, but they will rise to 25% by 2026, UBS analysts estimated in a research report last week.
That could force up to 75,000 stores to close by 2026, including more than 20,000 clothing stores and about 10,000 consumer electronics stores, UBS estimates. Thousands of home furnishings and sporting goods stores will also need to close as online shopping grows rapidly.

Some retailers are opening stores, though. The Coresight report noted that this year, retailers have announced they will open 2,641 stores. The discount sector in particular is growing: Dollar General announced it will open 975 stores this year.

Meanwhile, eccentric discount chains like Ollie's Bargain Outlet (OLLI) and Five Below (FIVE) are expanding. Discount grocers Aldi and Lidl also plan to open hundreds of stores in the United States to reach customers who are shopping for cheap groceries.
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About time.

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https://www.axios.com/sears-sues-ex-ceo-steven-mnuchin-and-others-for-theft-of-billions-1555615740-1709bea1-286f-47b4-8422-9393bf21e23d.html

Sears sues ex-CEO, Steven Mnuchin and others, claiming asset-stripping drove bankruptcy


Photo: Scott Varley/Digital First Media/Torrance Daily Breeze/Getty Images

Sears Holdings Corp. is suing its former chairman and CEO Eddie Lampert and a handful of former board members, including U.S. Secretary of the Treasury Steven Mnuchin, for allegedly stripping the company of $2 billion in assets, reports CNBC.

Details: Sears is also filing suit with Lampert's hedge fund ESL Investments, where Mnuchin was previously a director. The suit alleges Lampert and members of the fund's board instructed executives at the retailer to manufacture false financial projections that would imply a company turnaround, despite no plan for profitability and the company's accumulation of more than $7 billion in debt, per the Wall Street Journal.

What they are saying:

    "Had defendants not taken these improper and illegal actions, Sears would have had billions of dollars more to pay its third-party creditors today and would not have endured the amount of disruption, expense, and job losses resulting from its recent bankruptcy filing."

— lawyers for the company wrote in a court filing on Thursday

Sears claims Lampert declined a $1.6 billion offer for Lands' End and the Tommy Hilfiger investment group. Instead, the allegations, per CNBC, suggest: "Lands’ End was distributed to Lampert, ESL and other Sears’ shareholders for no consideration, following a prespin dividend of $500 million. On the stock’s first day of trading, its value topped $1 billion, with Lampert’s share worth at least $490 million. The stock currently has a market value of $591.3 million."

    The case also suggests that Lambert approved the sale of 266 of Sears' most profitable locations to Seritage Growth Properties — a real estate spinoff he created — for $649 million, which was below market value, per CNBC.

A spokesperson from ESL Investments Inc. told Axios: "ESL Investments, Inc. vigorously disputes the claims in the debtors’ complaint against ESL," and the allegations are " misleading or just flat wrong."

The big picture: Lampert was Sears’s biggest shareholder and its biggest creditor before it entered bankruptcy protection, Axios' Felix Salmon notes. As the company’s biggest creditor, he ended up owning the company in its post-bankruptcy incarnation. But as the company’s controlling shareholder pre-bankruptcy, he is vulnerable to lawsuits from disgruntled lenders who lost billions of dollars.

Go deeper: The cannibal of Sears
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🏬 Retail’s Existential Threat? Private Equity Firms
« Reply #260 on: April 21, 2019, 01:44:57 AM »
It's just good old-fashioned Capitalism, dontchya know?

RE

https://wolfstreet.com/2019/04/19/retails-existential-threat-is-private-equity/

Retail’s Existential Threat? Private Equity Firms
by John McNellis • Apr 19, 2019 • 57 Comments • Email to a friend   


A “bust out” is a fraud tactic used in the organized crime world wherein a business’s assets and lines of credit are exploited and exhausted to the point of bankruptcy — Wikipedia.
By John E. McNellis, Principal at McNellis Partners, for The Registry:

Bleeding badly, Debenhams, a 200 year old British department store chain, died last week. The coroner trotted out the usual suspects — the internet, the oversupply of retail, rising rents, tighter margins and, at the end of the dreary line-up, private equity. As it happens, Debenhams had been purchased by a private equity consortium led by Texas Pacific Group (TPG) in 2003.

That group paid £1.8 billion for the company, using £600 million in equity and £1.2 billion in debt it forced Debenhams to assume. The private equiteers promptly began selling off assets, dramatically cutting costs (store refurbishments dropped 77%) and awarding themselves large dividends for their efforts. And, no surprise, consumers lost interest in the fraying stores.

Since I first wrote about private equity’s looting and ultimate devastation of Mervyn’s (“On Private Equity and Real Estate” September 2012, behind paywall), retailer after retailer has been similarly gutted. Payless Shoes, Toys ‘R’ Us, Gymboree, Sears Holding, Mattress Firm and Radio Shack — all companies at one point owned or controlled by private equity firms — have since filed Chapter 11. In fact, Debtwire, a financial news service, calculates that about forty percent of all US retail bankruptcies in the last three years were private equity backed.

How do the private equiteers do it? Simple, the leveraged buyout. The LBO is the financial world’s pick and roll, that is, a highly effective play that is difficult to counter, especially if the PE firm takes the prudent first step of bribing its intended victim’s CEO into going along with their acquisition.

In short, the PE firm pays top dollar for a given retailer, often even overpaying, but using as little equity and as much debt as it possibly can. It then improves the company’s profitability by cost-cutting beyond prudence and, as with Debenhams, says, “What a good boy am I,” rewarding itself with a major dividend, often recovering not only its entire initial investment, but a substantial profit to boot.

A PE firm may be in good faith, it may actually use its best efforts — to be fair, equiteers sometimes succeed with their retail acquisitions — but even under the best of circumstances, retail is a difficult business, the threats from e-commerce, changing tastes and ever more nimble competitors are all too real.

Here’s the PE challenge: If you’ve already got your investment plus a fat profit out of a company, how hard are you going to continue to work on bailing it out, especially when you’ve crushed its bottom line beneath a wrecking ball of expensive debt?

Is this legal? It shouldn’t be. Is this moral? You don’t have to ask. Is this perpetrated by a single bad guy? Does private equity have its own Vladimir Putin? No. The industry is more like Ali Baba and the Forty Thieves; everyone gets in on the action. In fact, it’s hard to think of a private equity firm that hasn’t dipped its toe in this cesspool.

With apologies to those firms unintentionally left out, the players read like a who’s who of the PE industry: Bain Capital Partners, Blum Capital Partners, Cerberus Capital Management, (when a company names itself after the three-headed dog that keeps lost souls in Hell from escaping, you just might intuit a certain moral ambiguity), Golden Gate Capital, Kohlberg Kravis Roberts, Lone Star Global Acquisitions, Sun Capital Partners, Sycamore Partners, TPG and Vornado Realty Trust.

The list goes on, but you get the point. And yes, Bain was Mitt Romney’s firm, but please remember that Richard Blum, husband of Senator Dianne Feinstein, is the principal of his eponymous firm. This isn’t about politics, just money.

Since private equity’s insidious effect on retail has been written about (to no apparent effect) as much as the President’s peccadilloes, it may be time to try a different tack. If a picture is worth a thousand words, an hour-long episode of the Sopranos is good for an encyclopedia on the topic of destroying retailers. In “Bust Out” (season 2, episode 10), Davey Scatino, an old boyhood friend of Tony’s, borrows money from the gangster to pay back gambling losses. Unable to repay his debt, Davey watches helplessly as Tony and Richie Aprile take over his sporting goods store. Knowing they will never pay another bill, the mobsters order ten times the store’s normal inventory, sell it all at a discount for cash, pocket the proceeds, destroying first Davey’s credit, forcing him into bankruptcy, then his life.

If Tony and Richie had prep school accents and minions in suits to bust out Davey’s business, you would be hard-pressed indeed to differentiate the mafia from the world of private equity. By John E. McNellis, for The Registry.

“Amazon’s plunge into the $800 billion US grocery industry posed an existential threat to rivals”: CNN, August 2018. So let’s see. Read…  Whole Foods’ Existential Threat?
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Offline azozeo

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Retail Apocalypto in FULL Derby Stride, 6100 mo' sto's nationwide
« Reply #261 on: April 24, 2019, 12:57:41 PM »
 The staggering rate of store closures that has rocked the retail industry over the last couple of years is expected to continue in 2019, with roughly the same level of closures expected this year.

Retailers closed a record-breaking 102 million square feet of store space in 2017, then smashed that record in 2018 by closing another 155 million square feet of space, according to estimates by the commercial real estate firm CoStar Group.

"This year we are predicting more of the same in the retail space," said Drew Myers, a CoStar senior consultant.

Retailers have announced more than 6,100 store closures so far this year, according to an analysis by Business Insider.

Here's a list of all the stores closing this year:

https://www.businessinsider.com/stores-closing-in-2019-list-2019-3
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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Are the hyper-specialist shops of Berlin the future of retail?
« Reply #262 on: May 02, 2019, 11:27:55 AM »

One shop sells nothing but buttons, another sells only liquorice, and another is ‘the world’s first textile butcher shop’. In the age of Amazon, it seems the way to thrive is to specialise

    Do you have a favourite niche specialist shop that only sells one thing? Tell us in the comments below

by Philip Oltermann in Berlin.


On the first floor of a nondescript 1,000 sq metre industrial unit in Berlin’s Steglitz district, four workers are cautiously placing pregnant queen ants into test tubes in order to dispatch them across Europe. This is Antstore, the world’s first specialist ant shop, a business with around two dozen employees, a glass-cutting workshop, plastic and plaster modelling studios and a full-time social media manager.



https://www.theguardian.com/cities/2019/apr/29/are-the-hyper-specialist-shops-of-berlin-the-future-of-retail?utm_source=pocket-newtab
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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Death of Retail - I Deliverd Packages for Amazon, It was A Nightmare !
« Reply #263 on: May 10, 2019, 03:32:35 PM »

I’m sure I looked comical as I staggered down a downtown San Francisco street on a recent weekday, arms full of packages—as I dropped one and bent down to pick it up, another fell, and as I tried to rein that one in, another toppled.

Yet it wasn’t funny, not really. There I was, wearing a bright-yellow safety vest and working for Amazon Flex, a program in which the e-commerce giant pays regular people to deliver packages from their own vehicles for $18 to $25 an hour, before expenses. I was racing to make the deliveries before I got a ticket—there are few places for drivers without commercial vehicles to park in downtown San Francisco during the day—and also battling a growing rage as I lugged parcels to offices of tech companies that offered free food and impressive salaries to their employees, who seemed to spend their days ordering stuff online. Technology was allowing these people a good life, but it was just making me stressed and cranky.



https://getpocket.com/explore/item/i-delivered-packages-for-amazon-and-it-was-a-nightmare?utm_source=pocket-newtab
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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After the Retail Apocalypse, Prepare for the Property Tax Meltdown
« Reply #264 on: May 13, 2019, 11:36:27 AM »


Big-box retailers nationwide are slashing their property taxes through a legal loophole known as "dark store theory." For the towns that rely on that revenue, this could be a disaster.


https://getpocket.com/explore/item/after-the-retail-apocalypse-prepare-for-the-property-tax-meltdown?utm_source=pocket-newtab
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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🏬 Brick & Mortar Meltdown, Manhattan Style
« Reply #265 on: May 17, 2019, 12:12:59 PM »
Empty Storefronts on Madison Avenue will be quite the sight to see in NY.

A real symbol of Collapse in action.

RE

https://wolfstreet.com/2019/05/16/brick-mortar-meltdown-manhattan-style-asking-rents-plunge/


Brick & Mortar Meltdown, Manhattan Style


Brick & Mortar Meltdown, Manhattan Style

Retail space asking rents plunge as landlords try to fill scores of vacant shops.

The average asking rent on Madison Avenue between 57th Street and 72nd Street, a prime shopping corridor in Manhattan, plunged 25% over the past 12 months, to $1,039 per square foot per year, and is down 37% from three years ago, according to the Manhattan Retail Report by the Real Estate Board of New York (REBNY):

With these slashed asking rents along with concessions, such as buildouts and flexible lease terms, landlords are now trying to attract tenants for their vacant retail spaces that are now densely dotting the major shopping corridors in Manhattan. The entire report is focused on ground-floor retail spaces.

Out of the 17 shopping corridors in Manhattan that REBNY tracks, rents fell in 12 of them. Rents on Madison Avenue showed the steepest year-over-year decline. But in terms of the three-year window going back to May 2016, rents in other corridors fell even further.

The principle is this: Brick and mortar retail – outside of gas stations, grocery stores, and auto dealers, accounting for about half of total retail sales – is under heavy pressure from online competition. The last thing these under-pressure retailers can handle is sky-high rents.

This is an issue in other expensive cities as well, such as San Francisco, where shuttered and vacant retail shops are everywhere. What happens is that after a 10-year commercial lease expires, the landlord doubles the rent, and the retailer or restaurant, knowing the revenues the business generates, says, forget it and leaves. And then the shop sits vacant. This happens time after time.

The way forward: slashing rents to where businesses can make the numbers work out. And this is now happening in Manhattan. Concerning the Madison Ave corridor, REBNY says:

High availability rates along the corridor have led owners to continue lowering their rents and offer more short-term lease agreements. Flagship retailers across the prestigious strip are taking advantage of the softening rents by either locking in long-term lease agreements, moving to smaller-sized spaces, or migrating further south.

And just when America’s brick-and-mortar shopping tradition is under relentless and brutal attack from e-commerce, more retail availability is being created, with immaculate timing. REBNY:

Manhattan retail inventory increased with new high-profile development projects such as Hudson Yards, Gansevoort Row, the Seaport District, and Essex Crossing, which all offer competitive asking rents and elevated visibility.

Amid these new, prominent retail availabilities, property owners are facing pressure to reprice existing vacant retail spaces at lower asking rents. As a result, many owners are also offering greater flexibility to prospective tenants in the form of shorter-term deals, concessions, and build-outs.

So here are more samples of the 17 shopping corridors that REBNY tracks in its bi-annual Manhattan Retail Report, showing average asking rents for available ground-floor retail spaces:

Fifth Avenue, between 42nd and 49th Streets

The average asking rent fell 20% over the 12-month period, the third year in a row of declines, to $878 per square foot (psf). Compared to spring 2016, over the three years, the average asking rent has plunged 36%:

Fifth Avenue, between 49th and 59th Streets:

This is the most expensive corridor in Manhattan, in terms retail rents. The peak occurred in late 2017 and early 2018. Since then, the average asking rent has fallen 22%, to $3,047 psf. So that’s a decline of $853 psf:

By comparison, this corridor is over 10 times more expensive than the corridor on 14th Street between 9th and 10th Ave and over 20 times more expensive than major corridors in Harlem. We’ll get to those in a moment. But when something is this impossibly high priced, is has the furthest to fall:

This decline is attributed to both historically high availability rates and low absorption rates, as high asking rents are diminishing tenant demand. Despite instances of rent reductions, newer owners who purchased spaces at peak market rates are slow to adjust their prices and are struggling to fill vacant spaces.

Bleecker Street, between 7th Ave South and Hudson St:

In this corridor in the West Village, the average asking rent has collapsed by 43% over the three years since 2016, to $294 psf.

East 86th Street, between Lexington Ave and Second Ave:

The average asking rents fell 9% year-over-year to $365 psf, “due to more expensive retail spaces along Lexington Avenue being recently leased out by Old Navy and JP Morgan Chase with remaining availabilities along the corridor being located further eastwards where rents tend to be lower,” the report said:

125th Street, between 5th Ave and Morningside Ave:

In this Harlem corridor, the average asking rent jumped 10% year-over-year to $137 psf, “attributed to several new spaces west of Fifth Avenue that came to market at the end of 2018, where rents tend to be higher compared to the east side. Deal-making along the corridor has remained steady with new tenants including Shake Shack, Whole Foods Market, Victoria’s Secret, and Bath & Body Works.” The average asking rent remains down a smidgen from 2016:

Columbus Avenue, between 66th and 79th Streets:

The average asking rent dropped 8% year-over-year to $279 psf, the third year in a row of declines. Over the three-year period, the asking rent has plunged 31%. REBNY says that the “price corrections” have actually “been ongoing since 2015”:

Broadway, Battery Park to Chambers Street

This corridor cuts through the Financial District, crosses Wall Street, and goes up to City Hall. It has undergone a huge change in recent years with major redevelopments all around, including numerous large residential developments in what used to be an area dominated by offices. Perhaps it was an outlier: The average rent jumped 19% in the six months from November to May, after it had dropped in the prior 12 months:

14th St, between 9th Ave and 10th Ave:

In this shopping corridor in the Meatpacking District, average asking rent dropped 12% year-over-year to $277 psf. Says REBNY:

Tourists, daytime workers, and nearby residents flock to the corridor for attractions such as The High Line, Google’s corporate campus, Chelsea Market, and Gansevoort Row. With this high foot traffic, 14th Street is viewed as the prime location for “experiential retail” concepts that cater to customer experiences, pop-up shops, fashion, and food and beverage stores.

Nevertheless, despite Google and all this enthusiasm about “experiential retail” concepts and what not, the average asking rent has dropped 20% over the past three years:

“Manhattan’s continued natural correction in retail rents is spurring deal-making across the borough’s top corridors as retailers reconsider new and existing ground floor spaces,” said REBNY President John Banks in the press release.

Price can fix a lot of problems. And there is always the other side – the very crucial other side: “Declining rents have fostered a healthier environment as more retail space is being absorbed at an affordable rate,” the report said. Because the easiest way to wipe out a majority of retailers on a street and then gaze at shuttered and vacant stores is to get greedy and try to obtain rents that the business cannot bear. At least a partial fix is to slash rents – and that’s finally happening.

by  • May 14, 2019 • Email to a friend

Weakness in transportation deepens. Freight rates still rising, but also coming under pressure.

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https://wolfstreet.com/2019/05/19/this-is-what-happens-when-retailer-asks-landlord-for-a-rent-reduction/

This Is What Happens When Retailer Asks Landlord for a Rent Reduction
by John McNellis • May 19, 2019 • 30 Comments • Email to a friend   


The practice of renegotiating rent is older than selling Thanksgiving turkeys as loss leaders, but there is a relatively new, ugly wrinkle to the game.
By John E. McNellis, Principal at McNellis Partners, for The Registry:

The International Council of Shopping Centers, far better known as the ICSC, gathers this weekend for its annual meeting in Las Vegas. Retail’s leading trade organization, the ICSC counts as members the tenants, developers, contractors and brokers who have built almost every shopping center in the country. Tens of thousands of them will be attending Vegas, swapping hopes, plans, dreams and lies, congratulating one another just for showing up. It’s fair to predict the mood in Vegas will be considerably more ebullient than that back at the players’ home offices, especially those of the owners of America’s retail.

A week ago, Business Insider reported that retailers have announced closures for 6,400 stores thus far this year, already more than in all of 2018. Against this loss, 2,264 new stores are slated to open, the majority of which — Dollar Tree, Dollar General and Family Dollar—sell the cheapest of all merchandise.

Despite these dreary facts, retail is actually in reasonably good shape (good enough for us to be constantly on the look-out for acquisitions), but any developer who tells you she isn’t having issues with at least some of her tenants is spinning facts faster than Disney’s teacup ride. In truth, a week rarely goes by without at least one tenant calling us, asking for a rent reduction. Some of these requests are legitimate — the tenant is truly struggling—but some, perhaps many, spring from profitable retailers’ rapacity, companies seeking to take advantage of weak landlords in the climate of fear engendered by the near-constant retail Armageddon headlines.

The temptation to say b*** me to this importuning is nearly irresistible, but — here’s the public service announcement — resist it.

With little more than personal experience and anecdotal evidence as support, I would suggest that tenants are bluffing at least half the time when they threaten a store closure if their demands are not met. But that means that sometimes they aren’t. In this context, you might do well to recall that “Go ahead and shoot” are purportedly the last words most often uttered just before dying.

Rather than suggest a sex act or slam the phone down, the prudent owner should listen, remain calm, and then ask the retailer for evidence to back up its poverty claims. Specifically, you should request not only the store’s gross sales for the preceding five years, but a store-specific profit and loss statement (“P&L”). The retailer’s response will be that it never divulges P&L’s. Your rejoinder should be that you never grant hardship requests without proof of hardship.

With minimal tussling, they will give you the store’s sales history and, with a little effort, you should be able to determine on your own whether its sales warrant a rent break. One way to do this is to call a competing retailer, someone who understands the tenant’s business, and ask him what he thinks of the poverty plea.

If, at the end of the day, you satisfy yourself that your tenant is still making money, just say no. If you think its situation warrants a reduction, ask yourself what your Plan B would be if the tenant bolted. If you have no obvious substitute tenant, make the deal. As my brother used to say about a different but analogous situation, “When there’s only one train in the station, you better get on it.”

While the practice of renegotiating rent is older than selling Thanksgiving turkeys as loss leaders, there is a relatively new, ugly wrinkle to the game. A commission-based cottage industry has sprung up in these challenging times to help retailers “rationalize rent.” Companies such as A&G Realty Partners and Hilco Real Estate have a simple, yet distinctly unpleasant business model: they get paid only when and if they succeed in banging a rent reduction out of a landlord, getting a commission (ranging from about 5% to 12%) of the rent saved.

Think about this: A call from the retailer itself means that you’re dealing with a salaried employee in the real estate department, someone who presumably wants to continue doing business with you, someone who may even value your relationship with the company, someone whose livelihood is not dependent on screwing you out of as much rent as possible.

Dealing with one of these boiler room operations — imagine the sales floor in Glengarry Glen Ross — is different. They will threaten you with store closures, misrepresent sales and profitability, cajole, pester and badger you until you cave in. If you get such a call, hang up, again without suggesting a sex act, and call the retailer’s real estate department and insist that the only way you will consider any sort of lease restructuring is in conversations directly with the company itself. virtuous tenant it is also ignorant of the true dynamics of commercial real estate ownership and operation of a business.
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Amazon Says It Will Buy Greenpeace USA In $212 Million Deal
« Reply #267 on: June 04, 2019, 12:44:58 PM »

Amazon is buying Greenpeace USA, in a merger that values Greenpeace USA at $212 million dollars. The internet retailer (and book seller, pharmaceutical company, grocery store, etc…) says it’s buying Greenpeace USA for the name recognition, industrial climbing skills, and their warehouses, but will be laying off about half of Greenpeace’s employees.

Greenpeace, which was founded in 1971 as a small direct action-focused environmental group, has expanded into a large multinational NGO with an operating budget of over 200 million dollars. Greenpeace USA is the US affiliate.

Amazon CEO and third creepiest man on earth, Jeff Bezos, justified the deal to investors, arguing, “Our marketing algorithms increasingly show that people are concerned about the decline of our Earth’s living systems, and I think any viable company would move to capture that widening demographic.” The sale, which has not yet been approved by Amazon shareholders, is expected to be concluded in the second half of 2019.

Amazon says that Greenpeace USA CEO, Annie Leonard, will remain in that role. “She can deal with all the calls from pissed-off hippies” said one unnamed Amazon communications official.

“Greenpeace has been profiting off of grassroots environmental activism for years,” said Bezos, adding, “they’re doing an amazing job at it and we want that to continue.”

In their news release, Amazon says all their factory workers will be undergoing Greenpeace climb training, with the ultimate goal of expanding factory productivity and drone delivery by having workers moving boxes on climb lines and traverses to enable three dimensional non-stop aerial packaging.

For Amazon, the move furthers its outreach to liberals after its purchase of Whole Foods and Jeff Bezos’ public spats with Trump. For Greenpeace, the move furthers its push to be bigger and larger and have more influence on corporations in order to Protect the Earth™. In addition, Greenpeace USA will be gaining full access to Amazon’s satellites to increase scouting capabilities.

Leonard defended the move on Greenpeace USA’s part saying, “While we don’t agree with many of Amazon’s business practices, at least now we have a seat at the table to make some compromises in defense of mother earth. Plus, their drones are going to be totally LEED-certified, and you can now order an Alexa device for your home, pre-loaded with direct action and security culture trainings.”

In a race to catch up with Amazon, rumor has it that Google has resorted to the old pen and paper to fill the Earth First! Journal’s PO Box with pleas for a merger. No Journal editors were available for comment (they were too busy talking shit to answer the phone), but the next issue of the magazine will be available to download directly to your consciousness.

EDITORS NOTE: This is obviously an April Fools joke, you dorks, but we’re sure Jeff Bezos wishes it wasn’t, as we all know he is an undead creep who won’t rest until he has dug his pale lecherous fingers into every corner of the earth.



https://earthfirstjournal.org/newswire/2019/04/01/amazon-says-it-will-buy-greenpeace-usa-in-212-million-deal/
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Re: Amazon Says It Will Buy Greenpeace USA In $212 Million Deal
« Reply #268 on: June 05, 2019, 08:11:42 AM »

Amazon is buying Greenpeace USA, in a merger that values Greenpeace USA at $212 million dollars. The internet retailer (and book seller, pharmaceutical company, grocery store, etc…) says it’s buying Greenpeace USA for the name recognition, industrial climbing skills, and their warehouses, but will be laying off about half of Greenpeace’s employees.

Greenpeace, which was founded in 1971 as a small direct action-focused environmental group, has expanded into a large multinational NGO with an operating budget of over 200 million dollars. Greenpeace USA is the US affiliate.

Amazon CEO and third creepiest man on earth, Jeff Bezos, justified the deal to investors, arguing, “Our marketing algorithms increasingly show that people are concerned about the decline of our Earth’s living systems, and I think any viable company would move to capture that widening demographic.” The sale, which has not yet been approved by Amazon shareholders, is expected to be concluded in the second half of 2019.

Amazon says that Greenpeace USA CEO, Annie Leonard, will remain in that role. “She can deal with all the calls from pissed-off hippies” said one unnamed Amazon communications official.

“Greenpeace has been profiting off of grassroots environmental activism for years,” said Bezos, adding, “they’re doing an amazing job at it and we want that to continue.”

In their news release, Amazon says all their factory workers will be undergoing Greenpeace climb training, with the ultimate goal of expanding factory productivity and drone delivery by having workers moving boxes on climb lines and traverses to enable three dimensional non-stop aerial packaging.

For Amazon, the move furthers its outreach to liberals after its purchase of Whole Foods and Jeff Bezos’ public spats with Trump. For Greenpeace, the move furthers its push to be bigger and larger and have more influence on corporations in order to Protect the Earth™. In addition, Greenpeace USA will be gaining full access to Amazon’s satellites to increase scouting capabilities.

Leonard defended the move on Greenpeace USA’s part saying, “While we don’t agree with many of Amazon’s business practices, at least now we have a seat at the table to make some compromises in defense of mother earth. Plus, their drones are going to be totally LEED-certified, and you can now order an Alexa device for your home, pre-loaded with direct action and security culture trainings.”

In a race to catch up with Amazon, rumor has it that Google has resorted to the old pen and paper to fill the Earth First! Journal’s PO Box with pleas for a merger. No Journal editors were available for comment (they were too busy talking shit to answer the phone), but the next issue of the magazine will be available to download directly to your consciousness.

EDITORS NOTE: This is obviously an April Fools joke, you dorks, but we’re sure Jeff Bezos wishes it wasn’t, as we all know he is an undead creep who won’t rest until he has dug his pale lecherous fingers into every corner of the earth.



https://earthfirstjournal.org/newswire/2019/04/01/amazon-says-it-will-buy-greenpeace-usa-in-212-million-deal/

The date on this article is April 1st.  As the last line says, or as you can find out by taking the link to the original article.
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Offline azozeo

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Re: Amazon Says It Will Buy Greenpeace USA In $212 Million Deal
« Reply #269 on: June 05, 2019, 12:11:39 PM »

Amazon is buying Greenpeace USA, in a merger that values Greenpeace USA at $212 million dollars. The internet retailer (and book seller, pharmaceutical company, grocery store, etc…) says it’s buying Greenpeace USA for the name recognition, industrial climbing skills, and their warehouses, but will be laying off about half of Greenpeace’s employees.

Greenpeace, which was founded in 1971 as a small direct action-focused environmental group, has expanded into a large multinational NGO with an operating budget of over 200 million dollars. Greenpeace USA is the US affiliate.

Amazon CEO and third creepiest man on earth, Jeff Bezos, justified the deal to investors, arguing, “Our marketing algorithms increasingly show that people are concerned about the decline of our Earth’s living systems, and I think any viable company would move to capture that widening demographic.” The sale, which has not yet been approved by Amazon shareholders, is expected to be concluded in the second half of 2019.

Amazon says that Greenpeace USA CEO, Annie Leonard, will remain in that role. “She can deal with all the calls from pissed-off hippies” said one unnamed Amazon communications official.

“Greenpeace has been profiting off of grassroots environmental activism for years,” said Bezos, adding, “they’re doing an amazing job at it and we want that to continue.”

In their news release, Amazon says all their factory workers will be undergoing Greenpeace climb training, with the ultimate goal of expanding factory productivity and drone delivery by having workers moving boxes on climb lines and traverses to enable three dimensional non-stop aerial packaging.

For Amazon, the move furthers its outreach to liberals after its purchase of Whole Foods and Jeff Bezos’ public spats with Trump. For Greenpeace, the move furthers its push to be bigger and larger and have more influence on corporations in order to Protect the Earth™. In addition, Greenpeace USA will be gaining full access to Amazon’s satellites to increase scouting capabilities.

Leonard defended the move on Greenpeace USA’s part saying, “While we don’t agree with many of Amazon’s business practices, at least now we have a seat at the table to make some compromises in defense of mother earth. Plus, their drones are going to be totally LEED-certified, and you can now order an Alexa device for your home, pre-loaded with direct action and security culture trainings.”

In a race to catch up with Amazon, rumor has it that Google has resorted to the old pen and paper to fill the Earth First! Journal’s PO Box with pleas for a merger. No Journal editors were available for comment (they were too busy talking shit to answer the phone), but the next issue of the magazine will be available to download directly to your consciousness.

EDITORS NOTE: This is obviously an April Fools joke, you dorks, but we’re sure Jeff Bezos wishes it wasn’t, as we all know he is an undead creep who won’t rest until he has dug his pale lecherous fingers into every corner of the earth.



https://earthfirstjournal.org/newswire/2019/04/01/amazon-says-it-will-buy-greenpeace-usa-in-212-million-deal/

The date on this article is April 1st.  As the last line says, or as you can find out by taking the link to the original article.


I read that....

There's a left handed curve ball C.T. in here somewhere !
You don't go reposting stale toast for shits & giggles.
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

 

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