People, lots of people, tons of people, more people then I ever want to deal with. That sums up the Vegas show; another record was set with the official count being over 45,000. That's even more than was expected, up about 10% from last year, which is in keeping with the local show increases. In one of the ICSC's daily newspapers they had a timeline of the growth of our industry's membership. The timeline went back to 1976 when President Ford spoke; I was a newbie then, with about five years experience and was impressed that an industry of only 5,500 members could attract such a major player. Of course, at 31, I thought 5,500 members was big. Looking back I realize how lucky I was to begin my internship in such a SMALL industry. We all knew each other's name and were "friends," relationships that have benefited me for the last 30 years. Today it's impossible to know such a large percentage of the membership as we did in the good old days, and that's everyone's loss. While we can't and don't want to turn the clock back to when the industry was more intimate, networking still works today and Vegas was THE place to network in 2006, especially on Wednesday if you were one of the smart ones to stay (talking of smart, make sure you get your picture to the ICSC ASAP or don't bitch when you're stuck in long lines having yours taken at one of the upcoming shows so you can get your badge). The reason for saying that the smart ones stayed for Wednesday is that it was the only slow day of the show, providing an opportunity to network with people you never met before and learn about projects and companies you never heard of, in addition to having more time to "putter." Monday at the show was the busiest I've ever seen at any event. At first I was worried, as from 8 a.m. to 9:30 a.m., our booth was slow. But at 9:31 a.m. the dam busted and didn't stop until 6 p.m. when the parties started. Monday was too busy for my own taste, since I can't handle a conversation with three people on four topics at one time. Tuesday was perfect. Between meetings and the crowd I was busy all day, but was comfortable with what was happening. Meetings were "interesting" in that when I had my landlord hat on every retailer complained the rents were too high and when I had my retailer hat on, I knew rents were getting out of hand. Unlike most, I don't believe I "made" any deals in Vegas but I did start a lot. And with a little bit of luck, 25% will be made, making me a very happy broker. No one I spoke to had a negative word to say about the show; some were giddy, some reserved, but all were optimistic. However, I sensed some degree of concern from many of the more experienced old farts. Leasing was slowing and yes, for the prime locations, rents were going up even if it took longer to make a deal. But for anything under a strong B, leasing was tougher. Lots of people came into our booth wanting leasing help for centers they recently acquired at a 9-12% CAP and, after looking at the centers, I understood why the price was "right;" It's because the center was "wrong." They were all "added value" opportunities and that's where my pessimism comes in. Over the last five years, vacancies in our industry have dropped drastically because a rising tide raises all ships (a booming economy), some more than others, but C & D center's vacancies dropped, making the value of many centers increase BIG. Now, if I'm correct and there is a slowdown occurring, not only will filling the existing vacancies in these marginal centers become more difficult but vacancies in these centers will rise substantially. And if these properties were acquired with extremely high leverage, the banks are in trouble, making the "guy" with cash King again (for the last five years it didn't matter if you had money, the banks were willing to provide up to 100% financing, so everyone was "equal." Rich or poor you can/could borrow millions and the only thing that mattered was a willingness to pay top rice.) I personally believe those days are coming to an end BUT the banks aren't there yet, as we must have had 30 to 40 bankers coming to our booth with programs to provide 80% to 100% of the money for an acquisition. Changing the subject to a lighter menu, if I had the money spent on all the parties I attended (forget the money spent for all the parties) I'd be retired with more money than I ever dreamed of. Some of the parties had to cost over $350,000. You know CAM went up at a lot of centers. Of course, the Bar Mitzvah of all Bar Mitzvahs was the New York Developers party with number two being the Henden event. But all the parties were jammed and upbeat. Between the parties and the dinners and then having to go to Louisiana for my in-laws' 50th anniversary, not only was I partied and dinnered out but I began to fantasize about a grilled cheese sandwich; no more steak, lobster or shrimp, just grilled cheese on rye. I may never go out to eat or drink again. Anyway, as I said, the attendance set records and I believe the increase came predominantly from finance people, city government personnel and brokers, but not retailers, which have had no substantial increase in ICSC's membership in the last five years. We're at a bar with 200 guys and only 20 girls; the odds are against us. Yes, the "girls" can participate in numerous locations (thank God they are not monogamous) but they still can't service all of us. I've been saying this for ten years and, if I live that long, another 10; we need to attract more retailers as members. While there might be a sense of a slowdown in leasing, the sale and acquisition of centers was hotter than ever. I think every third visitor to our booth wanted to know if we had property for sale and all promised a 30-day closing. Where are they when I do have property for sale? Then they fight with me over price and seem to need forever to close. But before they get into the negotiation they all contend to be big spenders. Before I forget, about a month before Vegas I attended the Retailers One on One show in Orlando, FL, which is one of the few NON -ICSC events a year I attend and a show well worth the trip. It attracted about 1,300 dealmakers, small in comparison to the 4,000 to 5,000 that attend the ICSC's Orlando event in August and nothing in comparison to Vegas. BUT if you deal in Florida, it's a "must attend" show. The event makes up for size by its gusto. There was lots of energy spent in this action-packed, one-day event. What really makes this show stand out is that 1) they allow REAL retailers in for free, so there were 250 or so in attendance 2) It's a one day, dealmaking show, starting at 10 a.m. and going until 10 p.m. A long day, but no seminars, no speeches, just dealmaking and networking at its finest (Oh, and the food is better). The "negatives" are that it costs $1,500 to exhibit and $350 to attend, higher then an ICSC event BUT again, 250 REAL retailers.
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