Speaker 1: Broadcasting live to New York Bloomberg eleventh, to Washington, d C.
Speaker 1: Bloomberg to Boston Bloomberg twelve, under It to San Francisco
Speaker 1: Bloomberg nine six to the country US Exam Channel one nineteen,
Speaker 1: and around the globe the Bloomberg Radio Plus Appen Bloomberg
Speaker 1: dot Com. This is taking Stock. I'm Kathene Hayes along
Speaker 1: with pim Fox. We're going to recon. It's the world's
Speaker 1: largest retail real estate conference where a year's worth of
Speaker 1: deals take place in just three days. This conference and
Speaker 1: convention for the shopping center industry taking place right now
Speaker 1: in Las Vegas and PM we're gonna speak to the
Speaker 1: President CEO of International Council of Shopping Centers, who's got
Speaker 1: a somewhat more upbeep of retail than we've heard on
Speaker 1: this show. Well, that's good because shopping malls, they seem
Speaker 1: to be dying a slow and ugly death. We're gonna
Speaker 1: be taking a look at the world of shopping malls
Speaker 1: and retail right now. Let's go to Charles Pellet in
Speaker 1: the Bloomberg newser in Fort Bloomberg Business Flash. I think
Speaker 1: of him. Thank you, Kathleen, just getting word of the
Speaker 1: un Credits Chief executive officer Federico Gazzoni has agreed to
Speaker 1: step down after almost six years at the helm of
Speaker 1: Italy's biggest bank, as his efforts to improve capital and
Speaker 1: revive profit lost the support of investors. He will depart
Speaker 1: once a successor has been named. Stocks are rising the
Speaker 1: most in two months today is increasing speculation the Federal
Speaker 1: Reserve will raise rates this summer, sparks gains in financial shares,
Speaker 1: while housing data signals the economy is strengthening enough to
Speaker 1: support higher borrowing costs. Brad McMillan, chief investment officer at
Speaker 1: Commonwealth Financial Network, says consumers are spending. Just look at
Speaker 1: new home sales this morning, and what that's meant is
Speaker 1: not the consumers can't spend, but that they haven't chosen to.
Speaker 1: But it's also meant that once they choose to start spending,
Speaker 1: there's a lot of dry powder. Speaking of spending, Best
Speaker 1: Buy fell the most in more than four months, after
Speaker 1: four were casting second quarter profit. The trailed animalists estimates
Speaker 1: and announcing the departure of Sharon McCollum, who helped revamp
Speaker 1: the company's operations and cut costs. Best By says McCollum
Speaker 1: will step down as chief financial officer and chief administrative
Speaker 1: officer after the company's annual meeting in June. Best Buy
Speaker 1: shares down today by six point six percent to thirty
Speaker 1: dollars and eighty four cents. Commerce Department said purchases of
Speaker 1: new homes searched in April to the highest level since
Speaker 1: the start of two thousand eight. Tenure down five thirty
Speaker 1: seconds the old one point eight five percent, Gold down
Speaker 1: one point eight percent, SMP up twenty six a gain
Speaker 1: of one point three percent to thirty two on Wall Street. Now,
Speaker 1: I look at other news from around the world. Thank you,
Speaker 1: Charlie from the Bloomberg Newsroom. I'm Vonnie Quinn. Human remains
Speaker 1: may hold the answer to questions about what caused that
Speaker 1: egypt air plane to crash. A senior Egyptian forensics official
Speaker 1: healthy associated press body parts suggest there was an explosion
Speaker 1: on board the plane. Egypt State Van News agency is
Speaker 1: denying the report. However, other Egyptian officials have said they
Speaker 1: believe terrorism is the most likely cause. In a speech
Speaker 1: to thousands of people today in Hanoi, President Obama encouraged
Speaker 1: Vietnam to strengthen its human Rights record, arguing countries prosper
Speaker 1: when they embrace freedom of speech, press and assembly. Confronting
Speaker 1: art imperfections and allowing everybody to have their say has
Speaker 1: helped us grow stronger and more prosperous and more just.
Speaker 1: A new report shows the nation seems to be kicking
Speaker 1: the habit faster than ever. Bloomberg's Michael Barr has more
Speaker 1: on the declining smoking rates. A new government report shows
Speaker 1: smoking among adults in the US felled a fifteen percent
Speaker 1: last year and involved the biggest one year decline in
Speaker 1: more than twenty years. The rate felled two percentage points
Speaker 1: from when about seventeen of an ould said they had
Speaker 1: recently lit up. Experts believe anti smoking ad campaigns, increases
Speaker 1: in the cost of a pack of cigarettes and smoking
Speaker 1: band to play the role in the decline. Michael Barr
Speaker 1: Bloomberg Radio, New York States Attorney general is suing Domino's Pizza,
Speaker 1: alleging it underpaid workers. Eric Schneiderman says his office is
Speaker 1: uncovered called rampant wage violations. The company calls that also disappointing,
Speaker 1: and contends it's worked with the stage for three years
Speaker 1: to help its franchises comply with New York's complex wage laws.
Speaker 1: Global News twenty four hours a day, powered by our
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Speaker 1: the world. From the Bloomberg Newsroom, I'm Bonnie Quinn, Charlie,
Speaker 1: and we thank you and again recapping stocks are surging,
Speaker 1: with the SMP five hundred index up one point three percent,
Speaker 1: gaining twenties six points to two thousand seventy four. Town
Speaker 1: industrials up two oh five, a gain of one I'm
Speaker 1: Charlie Peloton. That's a Bloomberg Business flash. You're listening to
Speaker 1: taking stock with pin Box and Kathleen Hayes on Bloomberg Radio.
Speaker 1: US commercial property values they rose by an average of
Speaker 1: ten percent in twenty fifteen, and since two thousand and nine, well,
Speaker 1: commercial property values have actually doubled. Here to tell us
Speaker 1: more about the world of real estate and shopping centers
Speaker 1: is Tom McGee. He is the president and the chief
Speaker 1: executive of the International Council of Shopping Centers and he
Speaker 1: joins us today from Las Vegas. Tom, thanks very much
Speaker 1: for being with us. Tell us why you're in Las
Speaker 1: Vegas along with almost thirty five thousand nine of your
Speaker 1: favorite friends. Well, good day and thanks for thanks for
Speaker 1: having me on Tim. I am in Las Vegas is
Speaker 1: the site of our annual recon convention, which brings together
Speaker 1: it's actually going to be close to thirty seven thousand
Speaker 1: people at the at the most recent count that come
Speaker 1: together fundamentally to do deals, to talk about leasing opportunities
Speaker 1: and shopping centers around the country. And there's a tremendous
Speaker 1: amount of energy that's taking place here. There's a lot
Speaker 1: of positive feedback about the industry and vibrancy, and I
Speaker 1: I think that if you took a mood in the
Speaker 1: temperature of the folks that are here, that would be
Speaker 1: quite optimistic. I mean, doing a deal, which is fundamentally
Speaker 1: why people are here, is somewhat of an optimistic bet
Speaker 1: on the future. And so we're very pleased with the
Speaker 1: number of people that are here. And this has got
Speaker 1: to come to a surprise to anybody who's listening to
Speaker 1: Bloomberg Radio our guests talking about retail ice age for
Speaker 1: for retailing right now. According to uh Burt Flickinger of
Speaker 1: Strategic Resource Group, although your latest figures show that there
Speaker 1: was actually an increase in UM the malls segment in
Speaker 1: terms of occupancy combined super regional and regional malls in
Speaker 1: the first quarter from NYOT four percent now it's up
Speaker 1: to ANTY three point seven. But brick and mortar is failing.
Speaker 1: That's the story, right, I'm not necessarily failing. But it's
Speaker 1: online sales that are the place to be, is what
Speaker 1: many are arguing when it comes to retail. Yeah, I know,
Speaker 1: I know that there is a lot of certainly um
Speaker 1: folks that believe that that's the case, but that actually
Speaker 1: isn't the case. I mean, certainly e commerce is here
Speaker 1: to stay and it's going to play an important role
Speaker 1: in retail, but um brick and mortars here to day
Speaker 1: as well. If physical retail is doing quite well. You know,
Speaker 1: you mentioned the occupancy rates, and I think what isn't
Speaker 1: being told and is the real story now is one
Speaker 1: of conversions that it's not really bricks versus clicks. It's
Speaker 1: really one of bricks an clicks, and consumers expect a
Speaker 1: seamless shopping experience, whether they're online or in a physical
Speaker 1: retail location. And still to this day, the vast majority
Speaker 1: of sales in this country happen in physical retail. E
Speaker 1: commerce sales are less than ten percent of the total
Speaker 1: retail sales, and actually their growth as the percentage is moderating.
Speaker 1: If you look at where the growth is coming, Yes,
Speaker 1: some of it's coming from Amazon, but a lot of
Speaker 1: it is coming from retailers that have physical locations that
Speaker 1: are building out their e commerce platforms. Speaking to this
Speaker 1: synergistic um synergy between e commerce and physical retail, which
Speaker 1: we use the term omni channel, What if you could
Speaker 1: just speak a little bit about the change that has
Speaker 1: taken place at malls at a time. For example, Macy's shuttering,
Speaker 1: what thirty six additional stores, seventy eight k martin Sears
Speaker 1: locations also going to close, but a lot of them.
Speaker 1: Malls have to spend capital in order to revamp. But
Speaker 1: they're not necessarily putting in stores, They're putting in things
Speaker 1: like restaurants in movie theaters. No, you're absolutely right. I
Speaker 1: mean I think that what the mall owners and really
Speaker 1: property owners, whether it's some malls or open air centers,
Speaker 1: lifestyle centers, etcetera. They're adapting to what the needs of
Speaker 1: consumers are. I mean, this is the ultimate consumer facing business,
Speaker 1: and right now, consumers have a tremendous appetite for entertainment, restaurants,
Speaker 1: lifestyle type of things, services and so um. As some
Speaker 1: of the anchor stores may close, it represents new opportunities
Speaker 1: to fill that with other offerings that you know, the
Speaker 1: consumer likes and in fact, you know, I think if
Speaker 1: you talk to the vast majority of landlords, they would
Speaker 1: tell you that the you know that that the energy
Speaker 1: that's in their properties is quite high, and that adding
Speaker 1: those new locations or new service offerings is quite positive.
Speaker 1: So this is a day three of RECON, the world's
Speaker 1: largest retail real estate convention in Las Vegas. But what
Speaker 1: are the singles coming out? What deals have been made?
Speaker 1: Are there certain malls and kinds of malls that nobody
Speaker 1: wants to invest in, but other ones that are hot?
Speaker 1: This is what investors want to know. Now, I don't
Speaker 1: I mean, I wouldn't say that there's one segment of
Speaker 1: the market versus others that that I would point to
Speaker 1: that is particularly doing better or worse. Shire at RECON,
Speaker 1: I think that when you have thirty seven thousand people here,
Speaker 1: all of those segments are doing are doing well, and
Speaker 1: from the standpoint of leasing and deals getting done, I
Speaker 1: would say that there's just a lot of energy here
Speaker 1: and I actually this is my first RECON as president
Speaker 1: CEO of by C s C. And so it is
Speaker 1: pretty inspiring when you walk around the facility. We pretty
Speaker 1: much take over the vast majority of Las Vegas Convention Center.
Speaker 1: And when you walk around and you see the level
Speaker 1: of energy and the number of meetings that are being
Speaker 1: held virtually every one of the uh the locations that
Speaker 1: are set up, it's pretty overwhelming. And it really, if
Speaker 1: you think of retail and shopping centers, is somewhat of
Speaker 1: a of a signal or a bell whether about the
Speaker 1: American economy. I think it does portel somewhat of an
Speaker 1: optimistic tone. Right now, Tom, does everybody there want an
Speaker 1: Apple store in their more? Well? Apple? I think, what,
Speaker 1: you know, it's a it's a good point. Certainly Apple
Speaker 1: is a hot retailer. But I think what what Apple
Speaker 1: has really demonstrated the importance of experience in the retail environment,
Speaker 1: and that is I think the theme that is so
Speaker 1: important to be successful in retail today, which is the
Speaker 1: consumer expecting experience when they go shopping. It's not just
Speaker 1: about you know, consummating a transaction and not just that
Speaker 1: commodity element of shopping, but It's really about how do
Speaker 1: I feel when I'm in the shopping center? What does
Speaker 1: it where does it transport? Mean? To an Apple is
Speaker 1: a great example of that thematic element of experience being
Speaker 1: so important. By the way, Tom McGee, president CEO of
Speaker 1: the International Council's Shopping Centers, joining us from Recall in
Speaker 1: Las Vegas. This is Boomberg Radio. Bloombertaking Stock is brought
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