GLG News by Mr. Kenneth Leonard, Principal
GLG News is now G+ Insights
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G+ is a community for professionals, academics and entrepreneurs to connect through online discussions and in-person meetings. You will continue to see G+ Insights (formerly GLG News) here as well as on the G+ website, where you can share and discuss the G+ Insights you read.
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Movie Gallery Going to the Gallows
February 2, 2010
Movie Gallery Plans Restructuring | online.wsj.com
Hollywood Video chain owner Movie Gallery is preparing to file for bankruptcy for the second time. They are closing stores and fighting a good fight but in my opinion, are doomed to failure for the reasons outlined below.
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Lampert Fiddles While Stores Burn
January 12, 2010
Sears Shares "Marketplace" | www.chicagotribune.com
An article ostensibly about Sears new online marketplace but one that reveals some never-before-revealed insights into the inner workings of the company.
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A Good "Heads Up" For the Optimists
January 12, 2010
VIEWS ON COMMERCIAL REAL ESTATE'S 2010 OUTLOOK | blog.retailtrafficmag.com
This article is basically a synthesis of several recent articles, blogs and TV (Bloomberg videos) appearances with industry experts. It reiterates what this author has been saying for many months not only about the prognosis for commercial real estate but for who is really responsible for the mess we are in.
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Now I Understand Why SHLD's Stock Is So High
December 19, 2009
Sears Holdings back on stock-buying shopping spree | www.chicagotribune.com
This article details the enormous percentage of SHLD's expenditures is being devoted to stock buyback. It also details the fact that they have the lowest percentage of capital expenditures in relation to sales of any of its' 13 competitors.
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Now Simon May Not Be Able To Afford GGP
December 9, 2009
Simon Makes Surprise Move and Expands Its Outlet Portfolio | retailtrafficmag.com
Simon buys Prime Outlets from its troubled owners for approximately $2.3 billion (or approximately $280 per square foot) in the largest real estate deal in the shopping center industry since 2007. It would appear that this deal makes sense for both Simon and the struggling Lakewood N.J. based Lightwood Group, what does it do to Simon's chances of successfully bidding for GGP?
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ULI & Pricewaterhouse Got It Wrong
November 28, 2009
Retail Real Estate Highlights from the Emerging Trends Report | retailtrafficmag.com
ULI & Pricewaterhouse released their joint annual Report on Emerging Trends in the Retail real estate industry. Although they reveal a somber outlook for 2010, in my opinion they did not take the most serious risk factors into consideration and consequently badly overestimated the outlook.
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How To Increase Your Stock Price And Ruin Your Company
November 20, 2009
Sears shelling out---for own stock | www.chicagotribune.com
Mr. Lampert, for the fifth straight year, has again gained the record for spending far less on his store's improvement and maintenance needs than any of his 13 major competitors, while at the same time, spending far more on buying back his own company stockthan any other retailer.
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Is This Mr. Lampert's 8th or 9th Life?
November 19, 2009
Sears Narrows Loss, Beats Estimates but Stock Falls | www.chicagobusiness.com
A flurry of articles have come out in recent days seemingly to diffuse the continuing failures of Mr. Lampert's prize holding. This article deals with the "surprise" caused by the losses being slightly less than expected. The others deal with the various new ventures Mr. Lampert has announced in his continuing efforts to slow SHLD's decline into oblivion.
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So The Sky Isn't Falling Quite Yet
October 15, 2009
Store Closings Likely To Peak in First Half of 2010 | www.printthis.clickability.com
Year-to-date , the U.S. retail industry saw 3.408 store closings, according to the ICSC. The number of closings is far short of the 10,000 to 12,000 closings many experts projected in late 2008. However this article indicates that 2010 may yet turn out to be even worse.
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If Borders Can't Make It Here, They Can't Make It Anywhere
October 14, 2009
Borders Renews Lease At 830 North Michigan Ave. | www.chicagorealestatedaily.com
Borders flagship Chicago store has long been rumored to be in trouble and not likely to exercise its' renewal option. It now has renewed but only for one year.
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The Jury Is Still Out On General Growth
October 8, 2009
General Growth's Cap RatesEstimates Are Getting Interesting | seekingalpha.com
As a result of a Goldman Sachs presentation in late September which featured a close comparison to Simon Properties implies cap rate of 7%, the author is stronglyugly suggesting that GGP is starting to look like a bargain.
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A Blight On the Taubman REIT's Glamorous Image
September 30, 2009
Taubman May Turn Over Atlantic City Mall To Lender | blog.retailtrafficmag.com
Taubman Co. is generally considered to be among the "best and brightest" of Mall REITS. If they are acknowledging serious problems with some of their properties, what must this portend for other REITs that have been assembled with far less dominant locations and/or retailers?
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September 24, 2009
Savvy Retailers Snatch Leases Out Of Other Chains Bankruptcies | www.printthis.clickability.com
This article presents a common industry practice as being newsworthy and in the process, gets it all wrong. The practice of retailers taking over other failed retailer's locations has been going on since time immemorial. I guess it was a slow news day.
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September 19, 2009
Buyout Fund Contemplates a REIT Turn | online.wsj.com
Mr. Baker, CEO of NRDC, (the company who showed such bargain hunting skills when they paid top dollar for the now defunct Linen'n Things and the rapidly declining Lord & TTaylor) plans to start a new REIT. Does anyone think he can really do a better job of buying distressed shopping centers than the pros like The Weingarten Co. or DDR?
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September 18, 2009
Blockbuster To Shutter 40% Of Stores | online.wsj.com
Only two days ago I reported that Blockbuster announced it was closing 1000 stores. It has now revised that number to 1500 or 40% of their total. What does this sudden increase say about their chances for survival?
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Is Blockbuster Going the Way of Hollywood Video?
September 16, 2009
Blockbuster Closing Up to 960 Stores by End of 2010 | blog.retailtrafficmag.com
Blockbuster just announced an increase in store closing from 685, ( the number announced on September 15th, 2009 ) to 960. While this is not a fatal blow, it certainly is a leading indicator of some serious problems that the GLG reader should be aware of.
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September 10, 2009
New frugality is the new normal, by necessity | www.wtop.com
Bob Kanter's careful analysis of this article did not mention the huge backlog of previously announced department store closings which will undoubtedly have a "domino" effect on the FFO of all major mall REITs.
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August 25, 2009
Washed Out | online.barrons.com
Mr. Laing, the Barron's reporter who has previously been a major Eddie Lampert fan, (he estimated the "breakup value" of SHLD @ $300.00 per share in 10/22/07) has finally had the courage to provide a detailed account of why King Eddie has no clothes. Although he is correct in most respects, in the areas of real estate collateral values which is my area of expertise, he continues to be in denial.
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Supervalu May Not Be Such A Super Value
July 9, 2009
Supervalu Says President,COO & EVP to Retire | www.nytimes.com
Until recently Supervalu has been a very good grocery wholesaler. All grocery wholesalers have been struggling to survive the onslaught from Wal Mart Superstores, Target Superstores, Costco, Sam's Club, etc. In a bold move several years ago Supervalu decided to transform itself into a retail grocery chain through a series of expensive acquisitions. It now appears that that strategy is unraveling.
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Distortion Wrapped in Misrepresentation Encased in a Lazy Reporter's Bad Writing
July 9, 2009
As Owner Struggles, Landmark Mall Languishes | www.washingtonpost.com
I could not help but bring this article to the attention of the GLG News readers because it is an excellent example of the silliness that surrounds every sick or dying mall. If the reader strips away the inaccuracies this article is not newsworthy or even worth reading. More importantly, it fosters and increases the myth of "the death of the mall".
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