Hedged In's  Instablog

From the NY Times:

In these desperate days in American retailing, mall owners are seizing on a new gimmick: wave-making machines. As the recession deepens, what does the future hold for suburban shopping centers?

A half-dozen malls across the country are planning to install a huge contraption called the Flowrider in vacant retail space. Where once people shopped for three-packs of underwear or sheet sets, they are now turning up in flip-flops and shorts to surf an artificial patch of ocean.

However good a business that turns out to be for the company controlling the Flowrider, it is also a sign of the times. With major retail chains like Linens ’n Things and Circuit City closing stores or disappearing altogether, mall and shopping center vacancies are soaring, forcing landlords to find new ways to lure traffic and stave off decline.

As more stores have closed, mall vacancies are at their highest point in almost a decade, according to Reis, a research company, which said the vacancy rate at the end of 2008 was 7.1 percent, compared with 5.8 percent at the end of 2007. Other analysts have slightly lower figures, but all agree that vacancies are rising.

 

If the vacancy rate was 7.1% at the end of 2008, wonder what it is now...

ETFs to watch:

• iShares FTSE NAREIT Retail Index (RTL)
• First Trust S&P REIT Index Fund (FRI) 
• iShares Cohen & Steers Realty Majors Index Fund (ICF) 
• iShares Dow Jones U.S. Real Estate Index Fund (IYR) 
• iShares FTSE NAREIT Real Estate 50 Index (FTY) 
• streetTRACKS Wilshire REIT ETF (RWR) 
• Vanguard REIT Vipers ETF (VNQ)