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Seven Must Reads for the CRE Industry Today (March 6, 2021)

Burlington Stores and Saks Fifth Avenue each announced changes to their retail strategies. Commercial Observer looks at whether recent scandals surrounding New York Gov. Andrew Cuomo have implications for real estate. These are among today’s must reads from around the commercial real estate industry.

  1. Burlington Stores to open 100 stores in 2021; cites ‘significant market share opportunity’ “The off-pricer, which ended the year with 761 stores nationwide, expanded its long-term store count potential to 2,000 stores, up from its previous target of 1,000 stores. It expects to open 100 new locations in its current fiscal year. In expanding the target, Burlington cited its new smaller store format and “the opportunity presented by accelerating retail disruption and industry-wide store closures” (Chain Store Age)
  2. Saks Fifth Avenue Owner to Separate E-Commerce and Stores Units “Few changes will be visible to customers. Saks Fifth Avenue, which is owned by HBC, will remain the brand name for both the stores and e-commerce business, the executives said. Shoppers will be able to buy online and pick up in stores. They will also be able to make returns and exchanges and use their Saks credit cards either at the stores or online. The online business will oversee the marketing and merchandising for both channels.” (The Wall Street Journal)
  3. Retailers pay more to fly everything from bikes to hot tubs from China as backup at U.S. ports delays deliveries “The combination of record container volume arriving at the Port of Los Angeles — the busiest container port in the Western Hemisphere due to its proximity to Asia — and Covid-19 delays are slowing down imports coming to the U.S. According to the International Longshore and Warehouse Union, around 800 of its 15,000 members have been out of work due to Covid-19 — either recovering from the virus or otherwise quarantining at home.” (CNBC)
  4. What Cuomo’s Scandals Mean for New York Real Estate, Economic Development “The third-term Democratic governor started the year with near-total control of the state’s coronavirus response, a plethora of infrastructure projects that prompted comparisons of him to Robert Moses, and as the favored candidate of New York’s deep-pocketed real estate community.” (Commercial Observer)
  5. Insurers rewrite business policies after pandemic legal tussles “New policies and renewals now define terms like ‘communicable disease’ or ‘microorganism’ – something existing policies often lacked, and which led to a flood of lawsuits that insurers have so far largely won. An exclusion drafted by the Lloyd’s Market Association, for example, says insurers will not cover any claim ‘directly or indirectly arising out of, attributable to, or occurring concurrently or in any sequence with a Communicable Disease.’” (Reuters)
  6. How CRE Liquidity Reigns Despite Volatility “Commercial real estate sales volume dropped 32 percent to $405.4 billion in 2020 from the prior year, according to Real Capital Analytics, which tracks deals of $2.5 million and above. But property sales in last year’s fourth quarter represented a year-over-year decline of only 19 percent, a vast improvement over the second and third quarters, when year-over-year dollar volume plunged more than 60 percent and 50 percent, respectively.” (Commercial Property Executive)
  7. Suburban Home Sales Soar in the New York Region “The frenetic sales activity — a second wave after a surge last summer — has been fueled by multiple forces: historically low mortgage rates; pandemic-fatigued city dwellers desperate for more space; and many employers’ willingness to embrace remote work, allowing buyers to look in places beyond what would be considered an easy commute.” (The New York Times)
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