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Economic fallout stalls retail expansion

Tooling around Tampa Bay on a gas station inspection tour, Richard Lawlor was so struck by the forest of "for sale" signs he started counting them.

"In the first 6 miles from Clearwater Beach, I stopped counting at 250. Same thing happened (up the once-hot retail development corridor) from Odessa to Brooksville," said the vice president of retail sales and marketing at New York-based Hess Corp. "It really made me question just how long before this housing slump rights itself."

Hess isn't easing off the expansion pedal for its local 80-store network yet. But a stagnant economy and evidence like the glut of unsold housing that caught Lawlor's eye are prompting many retail chains to put more of next year's store growth off for another year.

It's far from a standstill. But many shopping center developers say the flow of retail deals for 2009 has slowed. Even potent, no-messing-around Forest City Enterprises, which is building the Shops at Wiregrass in Wesley Chapel, acknowledges the lifestyle center will open only two-thirds full in late October. In St. Petersburg's Tyrone area retail hub, four large chain restaurants sit empty.

"It's tough out there," said Wogan Badcock, chairman of the Badcock & More, a 330-store home-furnishings chain based in Mulberry. He's almost relieved his company's sales are down only 3 percent. "Our industry experts don't see things coming back until 2010 or 2011 now."

"We're seeing some positive signs about our business everywhere but Florida," said Steve Knopik, chief executive of Beall's Inc., a Bradenton chain of 550 outlets and department stores.

The unsettled mood is spreading across a retail industry that already was skittish enough nationally to rein in store growth and close thousands of marginal locations in 2008.

At the 1,063-store Chicos FAS Inc., for instance, a once-hot apparel chain is taking another whack at store growth. "We think we've hit bottom," said Scott Edmonds, chief executive officer of the Fort Myers chain, which also owns the White House/Black Market chain and Soma Intimates. "But we're slowing our growth until these economic headwinds subside."

Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.

Economic fallout stalls retail expansion 06/30/08 [Last modified: Wednesday, July 2, 2008 6:34pm]
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