Rochester Democrat and Chronicle
It's a bit of a puzzle.
Though economic news in the past month has ranged from dismal to dire, local shopping malls are reporting good numbers and busy retailers.
The parking lots at Eastview Mall in Victor, The Marketplace in Henrietta, The Mall at Greece Ridge and smaller concentrations of retailers in the region have a bustle that belies talk of a double-dip recession.
The reasons, according to mall officials, have a little to do with Rochester and upstate New York and a little to do with Canada.
"This year hasn't been spectacular, but we've been up 3 percent to 4 percent in sales every month and we're looking at a little over 3 percent for the year," said Eastview general manager Mike Kauffman. "My sense is that our retailers have held up well this year."
Kauffman said the retail numbers reflect the stability of the Rochester and upstate economies, which haven't seen boom times in generations, but haven't experienced the post-boom declines still roiling many other parts of the country.
Because of stiff state taxes, gasoline prices are high in New York. But food price spikes have been relatively moderate and local housing is among the nation's most affordable. The regional unemployment rate in April was 7.2 percent, well under the national figure of 9 percent.
Upstate consumer confidence is weak, according to a survey released last week by the Siena College Research Institute. But in measuring retail buying plans, the survey tracks big-ticket items such as homes, cars and electronics, and not the smaller items typically purchased at malls.
"People might be buying at that level," Siena director Douglas Lonnstrom acknowledged. "But a 3 or 4 percent improvement (at the malls) has to be measured against 2009 and 2010, which were bad years.
Kauffman agreed that the malls and retailers in general are trying to climb out of a pretty large hole caused by the recession of 2007-09. "We're certainly not back to 2006 numbers," he said.
Still, the solid performance at local malls compared to other, more economically stressed regions has attracted the interest of large retailers like Von Maur Inc. and Nordstrom Inc., both of which are mid- to high-end specialty chain department stores that often serve as mall anchors.
Von Maur is based in Davenport, Iowa, and Nordstrom in Seattle. They like the economic positives of the Rochester region, but have concerns about its size.
"We're mid-sized, and these retailers like to go where the population numbers are higher," said Dennis Wilmot, vice president of leasing and development for Wilmorite Management Group.
Wilmorite, which owns the region's three largest malls, has been on a growth track for several years. Eastview added a new wing, restaurants and high-end retailers in 2003, and in 2008 announced plans for a $50 million upgrade over the next five to seven years.
The idea is to expand the mall footprint and attract big-time stores. The Marketplace is in the midst of an upgrade, bringing in new stores and adding a children's play area. Expansion-related announcements are expected soon at Greece Ridge.
The growth is geared to make the malls more appealing to a wide range of retailers, Wilmot said.
"It's the other side of the economy story that isn't told very much around here and that's that this region's retail picture has been strong," Wilmot aid. "The L.L. Bean people are very happy with their investment here (at Eastview) and told me that 10 percent to 15 percent of their shoppers are coming from Canada."
The Canada connection is bolstered when a community such as Rochester offers retailers that can't be found north of the border.
And it's bolstered still more when the Canada-U.S. currency exchange rate favors the Canadian traveler, as is now the case.
Greg Marshall, VisitRochester's senior vice president and marketing director, said retailers of all stripes continue to remark on the number of Canadian visitors they're seeing. VisitRochester, Monroe County's tourism agency, has a marketing campaign aimed at Canadians.
"It's not a good time for much of the economy, but for Canadian visitors to Rochester, it is a good time," Marshall said.