The retail boom taking place in emerging markets has not skipped over the Caribbean region thanks to the continuing and steady growth of tourism and government initiatives to attract private investment, speakers said Tuesday during the first day of ICSC´s Caribbean Conference taking place this week in San Juan, Puerto Rico.
“The industry will grow more during the next 10 years as consumers demand more shops, and new malls come into the market without affecting existing ones, ” Alfredo Cohen, director of Venezuelan mall developer Sambil Group, told the nearly 350 delegates coming from Canada, the Caribbean, Honduras, Mexico, the United States and Venezuela. Sambil Group has malls in Venezuela, one under construction in the Dominican Republic and another in the pipeline for Puerto Rico.
New investment is flowing throughout the Caribbean and the so-called Caribbean Basin region that includes Central America, and Caribbean coastal cities in Colombia, Mexico and Venezuela. Excluding Cuba and Haiti, countries in this region received 5.1 percent more tourists in 2010 than during the previous year. In addition, the number of cruise ship passengers arriving to the region’s docks went up 5.9 percent last year, said Latin American mall consultant Mario Castro, professional development chairman of ICSC´s Caribbean Advisory Committee.
The Honduran island of Roatan, a highly popular beach destination, has witnessed a boom in the number of visitors, who now amount to over 900,000 a year. Of those, 800,000 arrive in cruise ships, said Josephine Maalouf, corporate director of mall developer Corporación Lady Lee, headquartered in San Pedro Sula in Honduras and with a mall in Roatan, Megaplaza. Cruise ship passengers spend only a few hours in Roatan, “but leave $80 million to $120 million on the island annually,” said Maalouf. “The economic capacity of the Roatan population has grown so much that residents need shopping opportunities since the mainland is three hours away in a ferry.”
The main shopping centers in the U.S. and British Virgin Islands cater to the local residents, while tourists shop at specialty stores. However, some retailers such as Kmart have met success targeting ships’ crew members, said Gershwain A. Sprauve, corporate secretary of The West Indian Company Ltd., operator of the cruise ports and terminals, including retail stores, in St. Thomas and St. John.
Even challenged markets like Puerto Rico, afflicted since 2007 by an economic recession, still present growth opportunities for retailers; witness the debut during the past two years of such chains as Abercrombie & Fitch, CVS, Express, Forever 21, Krispy Kreme and TJ Max show, executives said. Retailers already in Puerto Rico continue to expand. Wal-Mart has announced plans to invest $101 million in three new stores in Puerto Rico between its Wal-Mart and Sam´s Club formats, said Puerto Rico’s Chief of Staff Marcos Rodríguez Ema. “We have turned around the economy and we are going the right direction,’’ said Rodríguez Ema. “Market indicators show consumer confidence has started to improve. Our goal is to make it easier for the private sector to get ahead and move forward. The government must end its role as the motor that moves the economy by providing the private and non profit sectors with all the tools necessary for them to become the main axis that helps move our economy.”
Even with an economic contraction of 3.6 percent last year, retail sales during the first 10 months of 2010 show a 1.26 percent increase over the same period in 2009, speakers said. With 350 shopping centers and a population of 3.97 million, Puerto Rico´s annual retail sales are estimated at about $35 billion, and are projected to grow by 2 percent this fiscal year, which ends in June. “Time has tested retail on the island and we have seen a minimal impact,” said Francis Xavier González, vice president of property management in Puerto Rico for Developers Diversified Realty. “Our industry held its ground even through a five year recession.”
Compiled by the staff of Shopping Centers Today. © January 19, 2011 International Council of Shopping Centers.