A 1999 U.S. Retail Sales, Mall Sales, and Department Store Sales Review

Written by Dougal M. Casey
Edited by Michael Baker

1999 Total Retail Sales
1999 Shopping Center-Inclined Sales Results
1999 Sales by Store Type
1999 Internet Retail Sales
1999 Mall Merchandise Index Sales

This white paper is a preliminary overview of 1999 U.S. retail sales, mall sales and department store sales results. Additional data from the U.S. Census Bureau, due later this year, will enable us to draw a more definitive picture of what happened in 1999; in the meantime, the following pages provide an early summary of available data. We combine data from three sources: the Census Bureau's Monthly Retail Trade Survey, ICSC's Monthly Mall Merchandise Index and ICSC's Monthly Department Store Sales Report. These three sources enable us to present summary information on 1999's total retail sales, shopping center-inclined retail store (stores that rely on shopping centers for most of their sales) sales, per-square-foot mall sales, and department store sales. These sales figures are presented under one cover in order to provide an overview, not to encourage direct comparison between the Census and ICSC numbers. Indeed, conceptual differences - especially the fact that Census numbers are based on total sales volume while ICSC's Monthly Mall Merchandise Index figures are based on sales per square foot-mean that the data sets should only be compared with caution.

Total Retail Sales, 1998-1999 (Census Bureau)

Sales in all U.S. retail establishments grew from $2.746 trillion in 1998 to $2.993 trillion in 1999, an increase of $247 billion, or 9.0%. (See Table 1.)

Shopping center-inclined stores increased their sales by $109 billion, to $1.548 trillion-a gain of 7.6%. These stores registered about 52% of the nation's 1999 retail sales and captured about 44% of the nation's total 1999 retail sales growth.

Table 1. CHANGE IN U.S. RETAIL SALES, 1998-1999
Store Type	Sales Gain		Share of Sales Gain
	Amount (In Billions)	Percent	Percent
Shopping Center-Inclined
GAFO	$56	7.6%	23%
Convenience
Food	$24	5.4%	10%
Drug	12	11.4%	5
Subtotal	$36	6.6%	15%
Home Improvement/Building Materials	$17	10.5%	7%
Shopping Center-Inclined Subtotal	$109	7.6%	44%
Mail Order	13	17.2%	5%
Automotive	78	11.6%	32%
Gas Stations	17	10.8%	7%
Eating-Drinking	19	7.2%	8%
All Other	11	3.6%	4%
Total	$247	9.0%	100%

Note: Some figures are slightly rounded.

Within the shopping center-inclined stores group, home improvement/building materials stores realized 10.5% sales growth; GAFO stores (General Merchandise, Apparel & Accessories, Furniture & Furnishings, and Other GAFO stores) collectively achieved 7.6% sales growth, led by the general merchandise stores category (+8.5%). (See Table 2.) The furniture and furnishings stores group achieved a 7.7% sales increase (Table 2).

Further along in the shopping center-inclined store group, among convenience stores, grocery stores recorded 5.5% sales growth, and drug stores achieved 11.4% sales growth (Table 2). (Please note that the year-end 1999 estimates reported by the Census Bureau are subject to revision in the Bureau's Revised Monthly Retail Trade report, due out late this spring and in the Bureau's Benchmark Report for Retail Trade, to be published this summer.)

Table 2. ESTIMATED U.S. RETAIL SALES 1998-1999  (Billions of Dollars)
Store Type	Actual 1998	Estimated 1999	Percent Change 1998-1999
GAFO
General Merchandise
Department Stores
Conventional	$54	$56	3.1%
Discount	186	205	10.5%
National	43	43	-0.5%
Subtotal	$283	$304	7.4%
Misc. GM Stores, inc. Variety Stores	68	77	13.2%
GM Subtotal	$351	$381	8.5%
Apparel & Accessories
Women’s Ready to Wear	$28	$29	4.9%
Women’s Specialty	6	7	8.5%
Subtotal	$34	$36	5.6%
Men’s & Boy's	11	12	4.4%
Family Clothing	49	53	8.3%
Shoes	21	21	0.2%
Other	12	13	8.3%
A & A Subtotal	$127	$135	6.3%
Furniture & Furnishings
Furniture & Home	$42	$45	6.2%
Floor Covering	14	16	9.9%
Other	15	15	-
Subtotal	$71	$76	6.7%
Appliance	$11	$12	5.5%
Radio, TV & Computers	58	64	10.5%
Subtotal	$69	$76	9.7%
Music	12	12	2.4%
F&F Subtotal	$152	$164	7.7%
Other GAFO
Jewelry	$21	$23	10.5%
Books	13	13	3.7%
Sporting Goods	22	23	4.2%
Camera/Stationery/All Other GAFO	43	46	7.0%
Subtotal	$99	$105	5.9%
GAFO Subtotal	$729	$785	7.6%
Convenience
Grocery	$415	$438	5.5%
All Other Food	23	24	4.3%
Subtotal	$438	$462	5.4%
Drug	$107	$119	11.4%
Convenience Subtotal	$545	$581	6.6%
Home Improvement/Building Materials	$165	$182	10.5%
SHOPPING CENTER-INCLINED TOTAL	$1,439	$1,548	7.6%
Mail Order Retailers	73	86	17.2%
Auto Dealers	669	747	11.6%
Gas Stations	162	179	10.8%
Eating & Drinking	267	286	7.2%
All Other	136	147	8.0%
TOTAL	$2,746	$2,993	9.0%

Note: Some figures are slightly rounded to the nearest billion dollars.

Sources: 1999: U.S. Census Bureau, Monthly Retail Trade Survey, December 1999, February 14, 2000
1998: U.S. Census Bureau, Annual Benchmark Report for Retail Trade, 1989-1998, BR/98-A, August 1999.

Shopping Center-Inclined Sales, 1998-1999
More detailed examination of shopping center-inclined store sales indicates:
Department store sales rose by $21 billion, or 7.4%; 90% of this gain was registered by discount department stores, whose sales rose by 10.5% and which now account for 67.4% of total department store sales, up from 47.2% a decade ago.

The conventional department store group raised its sales by about $2 billion dollars, to $56 billion--a 3.1% gain--while the sales figures reported for the national chains slipped a bit, but stayed in the $43 billion range.

Apparel and accessories stores registered $135 billion in sales--$8 billion, or 6.3% higher than 1998. About half of this gain was captured by family apparel stores, which raised their sales by 8.3%, from $49 billion in 1998 to $53 billion. Both women's apparel stores and men's and boys' apparel stores registered about 4.5-5% sales growth as well. Shoe store sales stalled at $21 billion. (To update a side note from earlier years: in 1993 apparel and accessories stores recorded sales of $107 billion, while furniture & furnishings outlets registered $106 billion; since then, apparel & accessories store sales have grown 4.0% annually to $135 billion, while annual furniture & furnishings store sales have risen 7.5% per year, to $164 billion.)

Women's apparel store sales in 1999 rose by 4.9%, or more than a billion dollars from their 1998 level of about $28 billion (according to the Census Bureau figures of February 19, 2000, upon which this analysis relies).

The furniture & furnishings store group's sales rose by $12 billion to $164 billion--a gain of 7.7%. Radio, TV and computer stores captured $64 billion (39%) of these sales, while achieving a 10.5% sales increase over 1998 and capturing 50% of the furniture & furnishings store group's overall growth.

Sporting goods store sales rose by about a billion dollars, or 4.2%; book store sales edged up by 3.7%, and jewelry store sales, according to these preliminary data, grew by about $2 billion, or 10.5%, toward $23 billion. This came on top of jewelry stores' 8.5% sales growth in 1998.

Home improvement/building materials store sales increased strongly, by 10.5% or $17 billion, continuing a run that has seen their sales rise by 7.1% annually since 1989.

Drug store sales rose by 11.4% or $12 billion.

Store types showing the largest sales gains in 1999, along with the size of their gains in billions of dollars and the percent change from 1998, were as follows:

Store Type	Sales Gain	Percent Change
Grocery Stores	$22.8 bil	5.5%
Discount Department Stores	$19.5 bil	10.5%
Home Improvement/Building Materials Stores	$17.4 bil	10.5%
Drug Stores	$12.2 bil	11.4%
Miscellaneous General Merchandise Stores	$ 6.5 bil	10.2%
Radio, TV & Computer Stores	$ 6.0 bil	10.5%
Family Apparel Stores	$ 4.1 bil	8.3%
Furniture Stores	$ 2.6 bil	6.2%

Among the store types exhibiting the most modest rates of growth over 1998 sales levels were these:

Store Type	Sales Gain/Loss	Percent Change
National Chain Department Stores switch	-$200 mil	-0.5%
Shoe Stores	+$40 mil	+0.2%
Music Stores	+$290 mil	+2.4%
Conventional Department Stores	+$1.7 bil	+3.1%
Book Stores	+$488 mil	+3.7%

A Decade of Change: Retail Store Sales, 1989 - 1999
A review of sales growth between year-end 1989 and year-end 1999 provides some longer-term perspective:

Shopping center-inclined store sales have risen from $957 billion in 1989 to $1.548 trillion in 1999

a growth of $59 billion per year

an annual growth rate of 4.9% during this ten-year period (See Table 3.)

This 1989-1999 sales growth is distributed as shown in Table 3, below.

Table 3.   AVERAGE ANNUAL SALES GROWTH BY STORE TYPE, 1989-1999   (Billions of Dollars)
Store Type	Sales 1989	Sales 1999	Annual Sales Growth	Annual Percentage Growth
GAFO	$455b	$785b	$33b	5.6%
Convenience	410	581	17	3.5%
Home Improvement/Building Materials	92	182	9	7.1%
Total Shopping Center-Inclined	$957	$1,548	$59	4.9%

The percentage of shopping center-inclined sales being registered by the convenience store group (supermarkets, smaller food stores like butcher shops and bakeries, and drug stores) has declined markedly, from 42.8% to 37.5%. (See Table 4.)

Table 4.   PERCENT DISTRIBUTION OF SHOPPING CENTER-INCLINED SALES BY STORE TYPE, 1989 AND 1999
Store Type	1989	1999
GAFO	47.5%	50.7%
Convenience	42.8	37.5
Home Improvement	9.7	11.8
Total Shopping Center Inclined	100.0%	100.0%

Census Bureau data from the P-60 series on Money Income of Households, Families and Persons in the United States; 1989 (#168) and 1998 (#206) (adjusted to 1999 levels for this analysis) indicate the level of national income growth that is driving this sales growth. Money income as defined by the Bureau of the Census rose at an annual rate of 5.3% per year between 1989 and 1999. Shopping center-inclined store sales during this time have risen by 4.9% annually. Thus, the share of income allotted to retail sales has increased by less than 1% during the entire past decade. Stated differently: retail sales are growing at roughly the same rate as income.

Table 5. CHANGE IN INCOME AND RETAIL SALES IN THE UNITED STATES, 1989-1999
Element	1989	1999	Annual Change 1989-1999
Households (Millions)	91.9	103.8	1.2%
Average Household Income	$36,500	$54,000	4.0%
Total Income (Trillions)	$3.354	$5.605	5.3%
Retail Sales (Billions)
GAFO	$455	$785	5.6%
Food	$347	$459	2.8%
Drug	63	119	6.5%
Convenience Subtotal	$410	$581	3.5%
Home Improvement (check actual name)	$92	$182	7.1%
Shopping Center-Inclined Sales Total	$957	$1,545	4.9%
Auto Dealers	$386	745	6.8%
TOTAL RETAIL SALES	$1,759.0	$2,993	5.5%
Share of Income Allocated To:	1989	1999
GAFO	13.5%	14.0%
Food	10.3%	8.2%
Drug	1.9	2.2
Convenience Subtotal	12.3%	10.4%
Home Improvement (check)	2.7%	3.2%
SHOPPING CENTER INCLINED TOTAL	28.5%	27.6%
Auto Dealers	11.5%	13.5%
TOTAL RETAIL SALES	52.5%	53.4%

Source: U.S. Census Bureau, Money Income of Households, Families, and Persons in the United States, 1998 (P-60,, No. 206), and 1989 (No. 168); 1999 Annual Benchmark Report for Retail Trade, January 1989 through December 1998, BR/98 A, 1999; U.S Census Bureau, Census of Population, 1990, and U.S. Census Bureau, Projections of the Number of Households and Families in the United States, 1995-2000, P-25, #1129, April 1996.

Data by more detailed store type are presented in table 6, below.

Note: Some figures are slightly rounded. Income: 1989 91.9Mil Households x $36,500 Average Household Income = $3.354Tr Total Census Money Income 1999 103.8Mil Households x $54,000 Average Household Income = $5.605Tr Total Census Money Income; 5.3% per year growth.

The ICSC Monthly Mall Merchandise Index, 1999

Regional mall non-anchor tenant sales reported to the Index for 1999 were $323 per square foot-2.4% higher than comparable centers registered in 1998. (See Table 7.) This is significantly above the 1.9% overall year-to-year growth rate the index has indicated from 1993 through 1998.

The key regional mall store types registering the highest levels of sales per square foot include:

The key store types recording highest percentage growth in sales per square foot according to these 1999 Index results appear below; an important point: these five store types were the only major, critical categories whose sales growth rate exceeded the 2.4% growth rate of the Index as a whole.

As we mentioned above, the Index's mall sales-per-square-foot numbers cannot be directly compared with total retail sales numbers for the U.S. because the latter do not account for changes in retail space occupied by each store type. Nonetheless, it does appear that the average regional mall in the Index, whose sales per square foot productivity is growing at a 2.4% rate in a 7-9% sales growth environment, is facing challenges to its market share.

Table 7. COMPARISON OF 1997 RETAIL SALES BY STORE TYPE IN THE ICSC MERCHANDISE INDEX WITH U.S. TOTAL, 1998 AND 1999
	Index Sales Per Square Foot		1998-1999 % Change
	1999	1998	ICSC Index (PSF)	Total U.S. Sales
GAFO CATEGORIES
General Merchandise
Apparel & Accessories
Women’s Accessories & Specialties	$418	$388	7.7%	8.5%
Women’s Ready to Wear	$234	$219	6.7%	4.9%
Men’s Apparel	$294	$287	2.3%	4.4%
Children’s Apparel	$388	$396	-2.1%	N/A
Family Apparel	$388	$376	3.3%	8.3%
Women’s Shoes	$351	$351	0.0%	0.2%
Men’s Shoes	$444	$442	0.5%
Family Shoes	$272	$267	1.9%
Children’s Shoes	$375	$388	-3.4%
Apparel & Accessories Miscellaneous	$521	$503	3.5%	8.3%
Subtotal	$308	$296	3.9%	6.3%
Furnishings
Furniture & Home Furnishings	$306	$301	1.7%	6.7%
Home Entertainment & Electronics	$376	$360	4.4%	10.5%
Subtotal	$345	$335	3.0%	7.7%
Other GAFO
Jewelry	$839	$768	9.2%	10.5%
Stationery/Cards/Gifts	$295	$300	-1.6%	N/A
Books	$242	$245	-1.3%	3.7%
Sporting Goods/Bicycle	$206	$193	-6.8%	4.2%
Toys, Hobby	$310	$316	-2.0%	7.0%
Other Miscellaneous GAFO	$346	$345	0.2%	7.0%
Subtotal	$382	$376	1.7%	5.9%
TOTAL GAFO	$333	$323	3.1%	7.6%
NON GAFO CATEGORIES
Food Service
Food Court1	$625	$613	1.9%	7.2%
Fast Food	$441	$432	2.2%
Restaurants	$321	$320	0.3%
Subtotal	$403	$398	1.2%
Other Non-GAFO Categories
Specialty Foods	$389	$402	-3.3%	4.3%
Supermarkets	$516	$513	0.6%	5.5%
Drug/HBA	$328	$324	1.2%	11.4%
Personal Services	$322	$313	3.0%	N/A
Automotive	$167	$153	9.2%	11.6%
Home Improvement	$395	$365	8.3%	10.5%
Theatres	$81	$85	-4.9%	N/A
Mall Entertainment	$73	$736	-0.8%	N/A
Other Non GAFO-Miscellaneous	$315	$329	-4.4%	N/A
Subtotal	$222	$228	-2.6%	N/A
TOTAL NON-GAFO	$288	$291	-0.9%	9.5%
GRAND TOTAL	$323	$315	2.4%	9.0%

Note: If food court sales per square foot calculations included dedicated common areas in the denominator, sales productivity would be in the $330psf range

The ICSC Monthly Department Store Sales Report
Same-store sales registered by department stores participating in ICSC's Monthly Department Store Sales Report on non-discount department store units open at least 13 months indicated a national sales growth rate of 2.2% during 1999, a little higher than the 1.5% sales growth indicated by the Census Bureau's data for the conventional and national chain department store groups (which together totaled $97.9 billion in sales for 1999, up from $96.5 billion in 1998 according to the Bureau's 1998 revised Benchmark report).

The Western Region (Colorado and all points west) led the four major regions with a 3.5% increase, followed by the Northeast (2.8%), then the Midwestern and Southern regions (1.3% each). The subregions (or Census Divisions) tell a slightly different story. The Mountain states led the nine subregions with a 4.3% sales gain, followed by a tie between the New England and Pacific subregions with 3.3% each. The Great Lakes and Plains states trailed all other regions with department store sales growth rates of 1.5% and 0.8%, respectively. (Please see Figure 2.)

Results from 25 major markets are also reported by ICSC. Five of these markets are located in the West and all five finished in the top 10 reported markets in 1999: #2 Las Vegas (5.9%), #3 San Diego (+5.1%), #5 Phoenix (+4.9%), #6 Denver (+4.6%) and #10 Los Angeles CMSA (+3.1%). The Northeast was led by #9 Boston CMSA (+3.6%) and #11 Philadelphia CMSA (+2.8%). The Midwest and South trailed, but each had metropolitan markets that generated significant department store sales gains. In the South, #4 New Orleans (+5.0%) and #7 San Antonio (+4.3%) led; in the Midwest, #1 Cincinnati (+6.0%) and #8 Kansas City (+3.9%) experienced strong years.

Figure 2. ICSC Monthly Department Store Sales Report Regional Sales Results, 1999.

A Quick Look at 2000
The Census Bureau's preliminary sales estimates for January indicate that the 1999 sales year has started fast, with January retail sales up an estimated 7.3% over January 1999 combined sales levels. Several individual store types reported strong sales growth, including home improvement/building materials stores, drug stores, and the general merchandise store group. (See Table 8 below.)

Table 8.   CENSUS BUREAU RETAIL SALES ESTIMATES FOR JANUARY
Store Type	January 2000 vs. January   1999
GAFO Store Group
General Merchandise stores	6.4%
Apparel & Accessories stores	1.7%
Furniture & Furnishings stores	10.6%
Other GAFO stores	3.4%
GAFO Store Average1	6.2%
Convenience Store Group
Grocery stores	2.7%
Other Food stores	4.2%
Food store Average	2.9%
Drug stores	7.8%
Convenience Store Group Average	3.8%
Home Improvement Building Materials Stores	5.9%
Shopping Center – Inclined Store Average	5.3%
Auto Dealers	13.6%
Gas Stations	21.1%
Eating & Drinking Places	8.1%
Mail Order	25.4%
TOTAL, ALL RETAIL STORES	9.7%

Note: Based on January 2000 preliminary figures only.

Were the January 2000 rates of sales growth to maintain throughout this year, shopping center-inclined store sales would rise by 5.3% or $82 billion to a level of $1,632 trillion; total retail sales would increase by almost $300 billion to just over $3.28 trillion. We shall see.

Internet Sales
How did Internet retail (business to consumer) sales do in 1999? The answer is fuzzy at best, but the next few paragraphs and tables will attempt an estimate.

The Census Bureau on March 2, 2000 published its first ever estimate of Internet retail sales. This sales figure has several key characteristics; it

is for the 4th quarter of 1999 only

is an estimate based on a sample of 12,000 firms

Is a retail figure; that is,

• it is business to consumer, not business to business;
• it excludes sales data from travel agencies, ticket agencies and stock brokerages;

includes sales of retail firms (like Barnes & Noble or Macy's) that are not primarily mail-order houses, as well as the sales of pure mail-order firms like amazon.com;

is not limited only to sales that are concluded by payment being made online.

The Census Bureau's estimate for retail e-commerce sales during fourth quarter 1999 is $5.3 billion; assuming that the majority of the merchandise included in this figure is GAFO merchandise or is influenced by the GAFO store sales calendar, this $5.3 billion fourth quarter estimate would translate to $16.6 billion in sales for the full 1999 calendar year. This Census Bureau estimate is compared with those of various private groups in Figure 3, below.

(Please note: Personnel at the Census Bureau have indicated that the Bureau hopes to expand the breadth of Internet sales reporting to include estimates of the distribution of Internet sales (a) between mail order/Internet firms on the one hand and real estate-based firms on the other, and (b) across merchandise lines. The timing for delivery of these more detailed estimates has not yet been determined.)

Figure 3.

The second estimate of e-commerce sales relies on a different methodology and has a few different characteristics which distinguish it from the first estimate. This estimate

Focuses on retail establishments, just as Estimate I does;

Relies on Census Bureau data just as Estimate I does; but

Allows for time-series estimates, so the reader can develop a sense of the trend; and

Provides the series of estimates for e-commerce retail firms that aremail-order houses, and excludes an estimate of e-commerce sales transactions by retailers that are primarily store operators.

Total Mail-Order Sales. The Census Bureau's most recent Annual Benchmark Report on Retail Trade provides estimates of mail-order house retail sales for 1989-1998; this paper provides a 1999 estimate based on the Bureau's report.

Since yearend 1989, mail-order house sales have risen by 12.6% annually, from $26.2 billion to an estimated $86.0 billion-about twice as fast as shopping center-inclined store sales. (See Figure 4). Please note: part of the reason for this relatively rapid growth rate is that the Census Bureau now-in contrast to reported past practice-attributes to mail-order firms the sales registered by mail-order (catalogue or Internet) operations of large real estate-based retailers, if such retailers report separately their real estate-based and mail-order sales.

Figure 4.

The disaggregation of this overall mail-order figure into its key components-catalogue, television, and the Internet-relies on estimates from various industry sources, including the Census Bureau and the Direct Marketing Association.

This methodology yields a 1999 sales estimate for e-commerce mail-order houses of $21 billion-0.7% of total retail sales and equivalent to 1.4% of shopping center-inclined store sales. By this estimate, sales of Internet-based mail-order retail firms grew by 61.5% during 1999-eight times the rate of growth registered by shopping center inclined stores. (Please note that these sales estimates exclude Internet sales by retailers that are predominantly real estate-based.)

Mail Order Sales Estimates-A Moving Target
Amidst the discussion of e-commerce's performance and prospects, numerous analysts have estimated Internet retail sales. The estimates vary greatly, and the magnitude of the variances makes it difficult to envisage clearly future e-commerce sales levels and impacts.

The next table and next few paragraphs illustrate-through review of the Census Bureau's original, and then revised 1997 mail order house sales estimates-the volatility of these estimates.

The Census Bureau's Benchmark retail sales study for 1997, which was published during mid-1998, estimated mail-order house retail sales at $48.7 billion. The Bureau's 1998 Benchmark report released during mid-1999, not only published 1998 sales figures but also revised previous years' figures as well. Total retail sales were revised upward by $49 billion or 1.9%. For mail-order houses, the change was much more dramatic.

The 1997 Benchmark study, as indicated above, estimated 1997 mail-order house sales at $48.7 billion; the 1998 Benchmark report revised this 1997 figure upward to $64.6 billion-a change of $15.9 billion or 32.6%. Thus, the mail-order house sales estimate, which accounts for only 2.5% of the revised 1997 total U.S. retail sales figure, accounts for 32.4% of the upward revision in the total U.S. sales estimate. (See Table 10.)

Table 10. 1997 TOTAL MAIL ORDER SALES—ORIGINAL AND REVISED
	1997 Report’s	1998 Report’s	Difference
	Original Estimate	Revised Estimate	Amount	Percent
Total Retail Sales	$2.566TR	$2.615TR	$49Bil	1.9%
Mail Order Sales	$48.7Bil	$64.6Bil	$15.9Bil	32.6%
Mail Order Share:	1.9%	2.5%	32.4%

Closing Notes
Yearend results from the most robust retail sales year on record left observers with plenty to ponder, including the following: Shopping center-inclined stores' 7.6% ($109 billion) sales growth was the greatest in recent memory; however,

Mail order retailers' sales (including internet retailers) grew much faster (17.2%) as did auto dealer sales (11.6%);

According to Census Bureau data, during the past ten years retail sales have grown at roughly the same rate as total household income has:

1989-1999 Annual Growth Rate
Household Income	5.3%
Total Retail Store Sales	5.5%
Shopping Center-Inclined Store Sales	4.9%

During the past ten years, sales growth rates have been achieved by store types favoring open-air strip center formats (e.g. discount department stores-10.1% compounded annual sales growth; radio, TV and computer stores-10.8% sales growth annually; drug stores-6.6%; book stores-6.4%). In contrast, some of the regional mall tenant mix mainstays have grown more modestly (women's ready-to-wear stores-essentially flat; men's and boy's clothing stores-0.9%; shoe stores-2.1%, and non-discount department stores-0.2%).

During the latter part of this decade the furniture and home furnishings store group, which had started the decade with national sales levels equal to that of the apparel stores group, ended the decade with sales 25% above the apparel store group's; the near doubling of the home-improvement/building materials store group's sales during the decade accentuated the market's interest in spending on the home environment.

The 2.4% growth in regional mall per-square-foot sales was the third largest year-to-year gain recorded by the ICSC Mall Merchandise Index since its inception seven years ago.

Estimated Internet retail sales-about $16 to $21 billion (depending upon source or methodology)--were only 0.5%-0.7% of total retail sales and equated to only 1.0-1.3% of shopping center-inclined store sales. So far, b-to-c retail sales are a phenomenon, not a factor.

Dougal M. Casey is Managing Director and Head of Investment Strategy for Clarion Partners, which invests in real estate on behalf of major public and private pension funds. At Clarion he leads the firm's research program, assisting in strategy creation, property acquisition, asset management, and client development. Previously, Mr. Casey spent thirteen years with Homart Development Co., the real estate subsidiary of Sears, Roebuck and Co. He received his Master of City Planning from Ohio State University and his JD from the Catholic University of America's Columbus School of Law. He is a member of the American Society of Real Estate Counselors, and is past chairman of the International Council of Shopping Centers Research Advisory Task Force.

ICSC Research Advisory Task Force

Michael P. McCarty, Simon Property Group

Vice Chair:

Gregory Kerfoot, Sears Roebuck and Co.

Rohan S. Andrew, Urban Retail Properties Co.
David Boxer, The Taubman Company
Robert J. Boyle, Cambridge Shopping Centres Ltd.
James K. Brand, General Growth Properties, Inc.
Steven R. Brown, Cohen & Steers
E. Dan Carroll, Dayton Hudson Corporation
Dougal M. Casey, Clarion Partners
John B. Chapman, HSG/Gould Associates
John Cirillo, Nordstrom, Inc.
David G. Daleiden, Weingarten Realty Investors
Karen L. Gentleman, Gentleman Associates
John H. Haake, Kmart Corporation
Ken Jones, Ryerson Polytechnic University
Michael Kranzdorf, Kranzco Realty Trust
Robert Lie, ING Real Estate
Jonathan Litt, Salomon Smith Barney
William Maher, LaSalle Advisors Limited
William J. McCollum, New England Development
Sharon Peters, Saks Incorporated
Martha S. Peyton, TIAA-CREF
John R. Ragland, The Rouse Company
Subha Ramesh, The Limited, Inc.
Craig R. Schmidt, Merrill Lynch
Douglas V. Schmidt, Best Buy Company
Kenard E. Smith, The May Department Stores Co.
William A. Speer, TrizecHahn Development Corp.
James W. Sullivan, Prudential Securities
Cynthia Ray Walker, Federated Department Stores
Gary T. Weber, J.C. Penney Company, Inc.
Christopher M. Wicker, The Retail Consulting Group
Lori Wittman, Heitman Retail Properties
Cindy Wozny, Deloitte & Touche
Mark Zygmontowicz, Thompson Associates

This ICSC White paper is published by the International Council of Shopping Centers. The designated Official Member of ICSC member organizations has received a complimentary copy of this report.

William H. McCabe, Jr., Chairman
John T. Riordan, President

Research:
John Konarski III, Senior Staff Vice President
Michael Baker, Assistant Director of Research
David Brand, Research Assistant
Rochelle Cohen, Educational Foundation Coordinator
Jean Lambert, Research Projects Manager
Susan Pistilli, Manager of Library Services
Veronica Soriano, Associate Research Analyst
Michael Tubridy, Assistant Librarian/Writer

For further information regarding this White Paper, please contact Michael Baker at ICSC at (703) 549-7404, extension 231.

Copyright © 2000 International Council of Shopping Centers. All rights reserved. Protected under Universal Copyright Convention and international conventions. This publication may not be reproduced in whole or in part in any form without written permission of the International Council of Shopping Centers. Printed in the U.S.A.