A large indication of the health of the retail markets and the ability of stores to remain open and successful will be seen with the coming of the fourth quarter reports, experts say, which will report on sales in the historically strong Christmas season. Hochberg says the true impact of the economy on the retail market won't be completely seen until Christmas, the time of year retailers depend upon for strong sales.

"Christmas is going to tell the story," Hochberg says. "For most people, September and October numbers have not been good, but those are generally small months in the course of the retail world, so the question is are people deferring third quarter purchases to make 4th quarter purchases, or cutting back all across the board."

However, Hochberg says the recent decline of gas prices may free up discretionary spending for consumers and allow for larger and more purchases for the holidays, which could make or break the health of some businesses. "Tenants can only pay so much in occupancy costs as a percent of their sales. If their sales go down, occupancy costs may go down," Hochberg says. "Rent increases are going to be hard to come by and you might even see some rent decreases coming upon renewals."

Hochberg says he has been surprised to see leasing activity continue at a slower pace from an unexpected source. "National retail chains have cut back expansion significantly and have delayed expansions, cancelling commitments made and deferring commitments yet to be made," Hochberg says. "However, we're still seeing good activity from new independents and small businesses, many formed by people laid off from their job who want to take a new direction with their life. There are people less connected with the big financial problems out there, (and) want to grow their business."

Despite this new energy, Hochberg questions whether it will be enough to sustain the market, and still expects a substantial increase in vacancy. "The thing I'm most concerned about with the stores that are closing is whether there is enough velocity of new retail concepts to absorb that space, and the ability of the market to create the tenants," Hochberg says. "When you look at what venture capital is back or where private equity is flowing, there aren't a large number of concepts. You have a market that's arguably overbuilt, and who's the new player?"

Hochberg says he doesn't see the market recovering for more than a year, possibly into 2010 or later. "It's not going to be that fast," Hochberg says. "The amount of time it takes to get a deal done is longer now, because companies and tenants are more careful. Landlords want to make sure they have a tenant that's going to be around or a while, because if you're putting in a tenant that doesn't have financial strength, they'll find themselves back with the space."

Additionally, Hochberg says the events of the past month may have a longer term impact that anyone has predicted, and have the potential to have permanently altered the way people spend. "The impact of all of this on retail is very interesting," Hochberg says. "You're going to see a significant turn toward a consumer mindset of greater savings rather than consumption, and there's going to be a trend toward great savings rates in the long-term as people try to replace what was in their 401K, and realize greater financial prudence is a good idea. But it's really going to depend on your product offering, and if you have merchandise people need and a niche people want to shop in, you're going to be fine."