Top Takeaways from ICSC Western Conference ’24

This week, many of our producers attended the 2024 ICSC Western Conference in Palm Springs, CA where they interacted with many of the nation’s major players in the retail industry. Below are key takeaways that a few of our producers had:

• Both regional and national tenants continue to push expansion goals into new markets and states. Quick-service restaurants and fast-food tenants appear to be seeing increased demand in existing locations and prospective markets. Discount retailers are expected to continue performing while consumers monitor their spending closely. Some grocers are testing smaller concepts to find opportunities in new locations. Landlords are working hard to backfill vacated locations by drug stores and discount retailers.
• Investor optimism has picked up significantly as we head into Q4 2024. It looks to be a busy year-end with the anticipated increase in transaction volume.
• Grocery-anchored shopping centers are seeing a remarkable rise in popularity, as retailers aim to connect with consumers in the very places they spend most of their time—at home. Meanwhile, the owners of these centers are stepping up their commitment to the community.
• Food tenants are dominating the market. Many of the most active retailers at the show were chain restaurants with major ambitions to grow. You might even say they are hungry for deals.
• Still Need Outside Investors: Despite the positive outlook and promising economic indicators, the demand for outside equity continues to outpace supply. Even for developments that are pre-leased, outside equity partners are necessary because the capital markets haven’t fully adjusted yet, and traditional limited partners are either tapped out or more cautious at this stage of the cycle.
• City relationships are crucial: In a market where deals take longer, face more scrutiny, and demand extra creativity to reach stabilized targets, strong connections with city officials are essential. While city officials regularly attend ICSC, the increased interaction between developers and officials this year was particularly noticeable.