A Silver Lining for Retail During the Pandemic? One Survey Thinks So
As New Jersey continues to open up following a year of shutdowns due to COVID-19, is there a silver lining for retail? Yes. Levin Management Corporation, which manages 15.5 million-square feet of retail property, including 7.5 million square feet in New Jersey, has conducted its annual outlook survey for retailers and there is hope.
In March and April of 2020, things looked dire for retailers, said LMC CEO Matthew Harding. Businesses had stopped abruptly. Stores shut down. But now things are better.
Regarding 2020 performance, it was no surprise that sales were down last year for a majority of the LMC survey respondents. However, Harding said one third reported their annual sales met or exceeded 2019 levels. Keep in mind that LMC surveyed a broad spectrum of businesses such as restaurants, gyms, entertainment places and grocery stores. To get this level of retailers to say that they did better than 2019, especially when some categories like gyms, entertainment and even restaurants were forced to close, is encouraging.
More than two-thirds of respondents expressed optimism for store performance in 2021. Retailers have learned to adapt and adjust during the pandemic. Their adoption of a variety of pandemic-fueled adaptations in 2020 helped. Harding said nearly two thirds added online ordering for store or curbside pickup. Nearly one third incorporated shopping reservations or appointment times. Other modifications included open-air setups for dining, limiting the numbers of shoppers in-store and stepping up cleaning protocols.
More than half of the respondents said they plan to keep either some or all of their adaptations in place as permanent operational practices, said Harding.
As far as brick and mortar resilience, Harding said people still like to go into stores and shop, no matter what. People like to order and pick up their items in-store within a two-hour time frame instead of waiting a couple of days.
Going into 2021, there's probably more retail property space on the market. Harding said it's a good opportunity to purchase space that wasn't available before in good areas.
Survey participants were asked what top three drivers they felt will have the biggest impacts on their business in 2021. The most popular included COVID-19 vaccine rollouts (68.8%), the further lifting of COVID-19 related restrictions (63.9%) and consumer confidence (54.9%).