The retail real estate industry holds high expectations for this year’s RECon convention, taking place in Las Vegas from May 19 through May 22, in spite of lingering concerns about the pace of the country’s economic growth and lackluster consumer confidence.
ICSC estimates there will be more than 33,000 retail real estate professionals in attendance at the show in 2013. Many of those going have full meeting schedules and anticipate strong leasing activity from retailers, including both deals that are already in the works and new contracts.
While the 2012 RECon show was a fairly buoyant event, Greg Maloney, president and CEO of Jones Lang LaSalle Retail, notes that during the past five conferences, everyone was “very guarded.” People expressed hope that business would get better. This time around, “everybody is expecting a very good conference.”
Jones Lang LaSalle will be sending approximately 175 employees to RECon this year, representing a 20 percent increase from the size of last year’s delegation. Many of the professionals attending will be from the capital markets and tenant representation groups, Maloney says.
Matthew K. Harding, president of Levin Management, a real estate services company with a 12.5-million-sq.-ft. property portfolio, also expects to see actual leasing deals being completed on the show floor, a departure from what was happening in the years during and immediately after the recession when the emphasis was on networking. Harding notes that retailers have already shown a strong appetite for class-A properties. If the economy continues to improve, tenants may look more carefully at class-B and class-C centers, he offers.
“We feel that it’s going to be a very good show, in terms of the number of meetings we have scheduled,” Harding says.
Colliers International plans on sending 275 professionals to RECon in 2013, approximately a 10 percent increase from the size of its team last year. Among the most active groups at the show will likely be capital markets specialists, the net lease brokers and the leasing brokers who represent restaurant tenants, according to Mark Keschl, national director with the retail services group at Colliers International. Keschl acknowledges that the consumer remains worried about debt overhang and less than robust job growth, but over the past five years, the industry has gotten used to operating in this new normal mode, he notes.
“None of the retailers we work with are taking their eye off the value proposition, but they have become accustomed to operating in this environment,” Keschl says.
According to Richard B. Hodos, executive vice president with CBRE, if someone told him three years ago how much new development would be happening in Miami, for instance, he would not believe it. But “retail sales appear to be healthy, auto sales are very high. It is an interesting environment—it’s a world of almost permanent uncertainty, but [as humans] we adapt, and it’s sort of what we are doing.”
Hodos, who notes that over the years the mood at RECon conventions has ranged from “jubilation to outright depression,” expects that in 2013, it will more of the former.
Even excess space specialists anticipate that retailers will be in expansion mode at the event. While certain markets around the country remain troubled, the economy overall is improving, giving retailers the confidence they need to expand, according to Michael Weiner, president and CEO of Excess Space Retail Services, a disposition and lease restructuring firm.
“Retailers are growing and repositioning and taking advantage of still much lower rents and I think those things will lead to a fairly robust show,” he says. “From what I’ve read, it sounds like attendance is going to be well into the 30,000 and it is great to see the industry recovering like that.”