CONTENTS

March 2008

• FEATURES
• Keeping vendor costs down
• Landlords are harnessing economies of scale by shrinking the number of vendors that serve their ever-growing portfolios.
• Sovereign funds hit the mall
• Sovereign wealth funds are taking an interest in retail real estate. Deals so far include stakes in The Related Cos. and British Land.
• In their mothers' footsteps
• Daughters of some of the first women to break into retail real estate are following the career paths blazed by their mothers.
• A new front in the war on counterfeits
• Brands are not just targeting vendors who sell counterfeit merchandise, they are sometimes going after their landlords too.
• Stuck on the mezzanine
• Developers squeezed for credit by the subprime mortgage crisis and falling property values have another option: pricey mezzanine loans.
• Unleashing Japan's REITs
• Japan's government will allow the country's REITs to begin investing overseas this spring.
• Growing tall in Ginza
• The world's luxury brands are building towers in Tokyo's Ginza district, spurred by high property prices and Japan's big appetite for top merchandise.
• Tapping Latin America's pension funds
• Foreign pension funds are investing in Latin America, but domestic funds do not enjoy nearly the same access in many parts of the region.




• DEPARTMENTS
• Center Stage
• The Patriots football team gave fans an exciting season. It wants to make next season even more so, with a retail addition to its stadium.



• The Common Area
• New technology may render store assistants redundant, but rising car ownership means a big need for old-fashioned parking spots still.



• Retailing Today - The section where landlords shop for stores


• Made to measure
• Mass-market apparel chains are offering custom fitting services, with varying results.
• Winn-Dixie's comeback
• The venerable Southern grocery chain is clawing its way back to profitability.
• Fit for a king — or a double
• Soon U.S. fans of Frette's posh sheets won't have to visit posh hotels to enjoy them.
• Abercrombie goes
• Aussie Gilly Hicks, the chain's fifth concept, is selling young women's underwear — Australia style.
• Banks sprout more branches
• Despite predictions that the bank branch would die, today there are more than ever.
• Build-a-car
• Inspired by the Build-A-Bear chain, Ridemakerz lets kids build their own toy cars.
• Up and walking
• The Walking Company's new owners insist the comfort shoe niche offers great room for growth.
• Franchise freedom
• Most retailers insist on strict uniformity from franchisers. Apricot Lane demands strict nonconformity.
• Imax to the max
• The giant screens may come to a screen near you, possibly in 3-D, thanks to deals with cinema chains.
• The Deegie's Carma experience
• The founders of this apparel store wanted to offer much more than apparel.
• Retail in brief
• A roundup of what's new in the world of retail.




• On the Ground
• It is tough for retailers to find space in Oslo at the moment, thanks to high demand. But new centers are on the way.





• News Makers
• When CBL bought four St. Louis–area centers from?Westfield, it also got Tim Lowe.



• The Bottom Line
• Retailers shy away from expensive new locations, and Kimco heads to Australia, plus some of the month's major retail acquisitions.

KIMCO GOES DOWN UNDER

Kimco Realty Corp. is making a play in Australia as turmoil rocks that country's retail property market. The U.S.-based REIT announced plans to invest $182 million in Australia's publicly traded Valad Property Group. Observers say the move gives Kimco a foothold in the consolidating Australian retail real estate market and an opportunity to buy and manage properties in Europe for institutional investors.

Australian real estate stocks have plummeted since Centro Properties Group was seen to be facing the prospect of default on some $3.4 billion in debt. “In our new Valad partnership, we see a terrific opportunity to accelerate our assets under management by teaming up with their fund's management platforms in both Australia and the U.K.,” said David Henry, Kimco's vice chairman and chief investment officer, on an earnings call. “As we move towards the commingled-funds model ourselves, we have much to learn from Valad, which has successfully introduced many value-added core-plus funds across the world.”

Through Valad, Kimco hopes to repeat the success of funds it has launched in Canada and Mexico, says Chairman and CEO Milton Cooper. “This is what institutional investors and real estate investors want today,” he said on the call. “They want higher yields.”