No, Retail is Not Dead

There is a widespread myth that needs to be questioned and confronted, and it goes something like this: First came Amazon, and then came COVID-19, and both killed retail. However widespread, this view of the retail market is inaccurate and incomplete. To be sure, parts of the retail sector are experiencing challenging disruptions, but other aspects of the industry are expanding and thriving. The state of the retail market is a mixed picture of disruption, change, adaptation, and success. This report will review recent consumer retail sales data from the holiday season and January, as well as explain the current state and trends within the sector.

Q4 2021 Economic Report

GDP GROWTH: TRENDING IN Q4 2021

The nation’s gross domestic product grew by 5.7% in 2021, the fastest rate since 1984. The Commerce Department also reported in its advance estimate released in late January that growth accelerated in the fourth quarter at an annualized rate of 6.9%, following a 2.3% reading for the third quarter.

The increase reflected gains in private inventory investment, exports, personal consumption expenditures, and nonresidential fixed investment that were partly offset by declines in federal, state, and local government spending. There was an increase in imports, which reduces the net GDP calculation.

Analysts expect a slowing in the first quarter due to high inflation and workers being kept home due to the highly contagious omicron variant of the COVID-19 virus.

Orders for durable goods fell 0.9% in December, which was more than expected, hitting their lowest point since April 2020 and reflecting a year-end slowing as infections skyrocketed.

The increase in private inventory investment was led by retail and wholesale trade industries. Within retail, inventory investment by motor vehicle dealers was the leading contributor.

Seven Things to Know About Commercial Real Estate in 2022

While continuous improvement is needed, the economy is recovering from the COVID-19 pandemic. 2022 will build on the recovery that is already underway both in the macroeconomy and in commercial real estate markets. However, don’t expect commercial real estate markets or the rest of the economy to go back to exactly as things were before the pandemic. The pandemic was more than just a shock to aggregate demand. It changed the way people live, shop, and conduct business. Some of the changes may dissipate over time, while others are likely to be permanent. Nearly every commercial real estate sector has been and will continue to be affected one way or another. This report will explain what trends to expect and watch for in 2022. Since no forecast is infallible, keep in mind that there are both upside and downside risks to the outlook. Here are the top seven things you need to know for 2022.

Supply Chain Issues: A Critical Analysis

Evidence of the supply chain crisis we are facing is hard to miss. Right now, off the coast of Los Angeles, over 80 large container ships are sitting idle waiting to dock and offload their cargo. The ramifications of this and other bottlenecks in our global supply chain system have caused a backlog of nearly $3 billion in goods that have been ordered but not yet shipped, according to U.S. Census data.1 What caused this to happen, what happens next, and when will it be over? This report will answer these questions and explain the causes behind our current predicament.

WHAT CAUSED THE CURRENT SUPPLY CHAIN BACKLOG?

The crisis began when the pandemic led to temporary plant closures to contain the outbreak, workers calling out sick, and international borders being closed. Many companies assumed consumers wouldn’t want to spend money during a crisis, so they scaled down production and furloughed and laid-off employees.