Reis in the News
By Jonathan Maze
Source: Restaurant Business – The Industry Will Wave to Adapt to a New Reality with Fewer Shoppers
Restaurant traffic has been weak for three years, and we’ve analyzed plenty of reasons for that, including grocery prices, changing consumer habits, oversupply and even weak movie receipts. All of those reasons are valid, but none are as big a factor as the retail apocalypse.
The issue has come up again as Red Robin Gourmet Burgers has struggled and faces an activist investor.
The chain has had a major problem with dine-in sales, which are more pronounced at the 76 locations it operates inside of malls. Seven of the 10 underperforming locations Red Robin recently opted to close are located inside of enclosed malls.
Retailers have struggled broadly in recent years as consumers have shifted more of their shopping online to places such as Amazon and Wayfair. Sears filed for bankruptcy and closed numerous locations.
In recent years, dozens of retailers have either completely shut down or greatly reduced their retail footprint. This year, that list includes Gap, which is closing 230 locations, Dollar Tree, Shopko, J.C. Penney, Office Depot and CVS.
According to real estate data firm Reis, the retail vacancy rate was 10.2% in the first quarter of the year, up from 10% a year ago. Late last year, the mall vacancy rate hit a seven-year high.