Many retailers have scaled back expansion plans in the face of the negative ``wealth effect'' and much publicized layoffs, according to Colliers International, a commercial real estate firm. Retail developers have responded by scaling back projects in almost all regions of North America.
Based on three-year forecasts for population growth, personal income, housing starts and gross metropolitan product, San Diego is among a group of Sun Belt cities expected to remain target markets for retailers. Atlanta, Las Vegas and Phoenix are other top-tier markets.
Other high-growth cities include: Bakersfield, Fort Lauderdale, Fresno, Houston, Orlando, Sacramento, Salt Lake City, Seattle, and Vancouver.
"Evidence suggests 2001 will be remembered as a year of consolidation,'' said Ross Moore, vice president and director of research for Colliers International. "Consumer confidence is critical to the strength of the retail sector. Right now, consumers are wary but hopeful the US will avoid a full-scale recession."
One sector bucking the consolidation trend is the home improvement retailers. While many retailers have put expansion plans on hold, spending on the home continues to be an area of growth as demonstrated by new store openings by Home Depot's Expo and Sears' The Great Indoor Experience.
Discount department stores and discount apparel retailers also continue to open new stores across North America with retailers such as Wal-Mart, Target, Kmart, Kohl's, Marshall's, Ross Dress for Less and TJ Maxx all continuing to thrive despite a slowdown in spending, according to Colliers. Major drug store chains and grocery retailers also continue to gain market share through growth.
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