Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)
Issue link: https://sct.epubxp.com/i/122387
Ph oto : Lat in Co nte nt/ Get ty im aGes pop star Belinda poses at the Grand openinG of the h&M; store in Mexico city. of the properties built in those years continue to have long-term issues, such as not enough pre-leasing. It has taken longer for them to get stabilized." Overall, though, the mall industry reports growing occupancy rates. Leasing in Prudentialís 15-mall portfolio is going up in previously under-occupied properties, while its successful properties have been able to raise rents, says Malugen. Grupo Frisa, with a 43-mall portfolio, reports slight index-linked sales growth for last year plus an improved occupancy rate. And mall developer Grupo Acosta Verde, which will open at least five malls this year, says the number of visitors increased 9 percent last year. "There is still more to be developed in Mexico, particularly in small and medium-sized cities that are growing and need the services offered by shopping centers," said Edgar Rodríguez, Grupo Frisaís director of operations. Over the past two years, Mexican shopping centers have welcomed roughly 40 retailers new to the country — the likes 244 SCT / M a y 2 0 1 3 of Crate & Barrel, Forever 21, Gap and H&M.; At least 10 new international names are expected this year. In February American Eagle Outfitters opened its first Mexico store, in Perisur, a Mexico City mall. This is the first of four that American Eagle has slated for this year. Retailers have noted with interest Mexicoís slashing of import tariffs on some 200 Chinese goods last year. Tariffs are down to no more than 34 percent. "This reduction is promoting many new retail investments," said Luis Llaca, vice president of retail at the Mexico City office of Jones Lang LaSalle. Even Mexicoís northern region, hard hit by the poor U.S. economy in combination with narcotics-trade violence, is staging an economic comeback. "There is more positive news coming out of Mexico today because of sound economic fundamentals," said Malugen. Meanwhile, the middle class has grown from 42.8 percent of the population in 2000 to 48.2 percent as of 2010. Consumer credit is growing too, with annual issued-credit growth rates ranging between 8 percent and 21 percent since 2009, all of which benefits the development of power centers and malls, says Edgar Mojica, geomarketing manager at Kem Consulting, a Mexico City–based research and marketing firm. Consumer credit is particularly important to a consumer class emerging in Mexico now: the lower middle class. "The income of this class is low, but it has growing access to credit," said Mojica. "These consumers are continuously purchasing, particularly clothing and technology, and are responsible about paying their bills." Appliance retailer Elektra was a pioneer in issuing credit to the working class starting in 1998, and other retailers have followed suit. Executives are bracing for a strong year. "The industry has resumed growth after a two-year pause," said Ignacio Rodríguez. "The challenge now is to thoroughly analyze the target consumer so projects fit well with the market." SCT