Wave of retail store closings expected in ‘09

Low sales may reshape industry

Wendy Natt, Jan 09, 09.

Some retail industry financial and real estate experts are warning that historically low retail sales in 2008 and one of the worst year-end shopping seasons in decades may cause a domino effect of major store closures and bankruptcy filings in 2009, says an article on CNN Money.com.

“There’s going to be a massive sea change in the retail landscape,” said Nina Kampler, executive vice president with Hilco Real Estate, a property management adviser to retailers.

Several large stores filed for bankruptcy in 2008, and the level of anxiety in the industry has many retailers looking to close up 25-30% of their least profitable stores, says the CNN article.

The International Council of Shopping Centers estimates that chain store closings could exceed 3,100 in just the first half of the year.

Kampler says she thinks that while these losses are unavoidable and will hit the economy hard with more job losses, they are also indicative of positive changes in consumer behavior - what she sees as a “recalibration” to a new mindset of buying only what we need, rather than everything we can.