NEW YORK — As hundreds of thousands of Hurricane Katrina evacuees seek to rebuild their lives in Texas, Georgia and other locales, retailers are closely watching potential population shifts that might determine future development.
“Retailers are very responsive to these kinds of things,” said Richard Hodos, president Madison HGCD Retail Services. “I would think that people who have lost stores in New Orleans and aren’t going to open them for some time will be looking to replace those stores and will look to places where population is increasing.”
Houston has been the epicenter for people fleeing New Orleans and the rest of the Gulf Coast, and Dallas, San Antonio, Atlanta, Baton Rouge, La., and Pensacola, Fla., are among the many cities where evacuees have relocated. With the disaster still unfolding and so many lives in disarray, it is impossible to determine the long-term future of the devastated region and how population patterns might change. In the near-term, at least, the need is clear.
“Retailers believe that the permanent population of Baton Rouge has changed overnight, and as a result it needs more stores,” said Jimmy Maurin, chairman of Stirling Properties in Covington, La., one of the largest real estate companies in the South with 7 million square feet of retail space. “We don’t know how many people will ultimately move back to New Orleans, but there’s not a house available for sale in Baton Rouge.”
“Any markets that are outside of the impacted areas stand to benefit,” Maurin said. “On the retail front, there’s a shift that occurred. In the last 48 hours retailers started discussing where to open up additional stores.”
Wal-Mart, the world’s biggest retailer, is among the companies monitoring the situation — but not ready to act.
“With the population growth, we will need the extra help and will provide jobs for associates who have evacuated and are not going to return for some time or won’t return at all,” a Wal-Mart spokeswoman said. Asked whether the company would open stores where evacuees have swelled the population, she said, “It’s way too early.”
Retailers throughout Dallas, especially grocery stores, discounters and lower-price department stores, are seeing upswings in business amid rising demand for food, clothing and personal-care items.
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“The hurricane, combined with high gas prices, has really affected people,” said Bob Goodfriend, chief executive officer of Knoxville, Tenn.-based Goody’s. Five stores, two in Louisiana and three in Mississippi, remain closed because of the direct effects of Katrina. “There’s nothing good about business right now.”
There were runs on Atlanta gas stations last week, with long lines and prices as high as $5 per gallon. Prices Tuesday averaged $3 a gallon, according to AtlantaGasPrices.com, a Web site that tracks retail fuel.
“It’s not high prices, but fear of shortages that’s getting consumers rattled, and if that continues, people will start to seriously alter shopping behavior,” said Jeffrey Humphreys, director economic forecasting for the University of Georgia.
Atlanta shopping malls downplayed the immediate impact of the storm and gas prices. “We expected gas prices and the hurricane to affect business, but as of now, it hasn’t,” said a spokesman for the Mall at Stonecrest, east of downtown Atlanta. North DeKalb Mall also said sales were strong. Radio Shack and Payless Shoes reported business from hurricane evacuees, buying mostly items for children.
Retailers finally began assessing the damage to their stores over the weekend, but units in New Orleans would have to wait as martial law had been declared in the city.
“We know we lost our Gulfport [Miss.] store,” said Pat Ziegler, a spokeswoman for Harold’s, a 42-unit chain based in Dallas. “We still have 15 stores that aren’t open. A lot of them are on the outskirts of New Orleans. It may be 30 days before we can go into that area.”
Fort Myers, Fla.-based Chico’s said six stores in the New Orleans area remained closed, including two White House/Black Market units, but the overall impact of Katrina was less than the four hurricanes that hit Florida last year.
Two Macy’s stores in New Orleans remain flooded and will be closed for the foreseeable future, said Jim Slewzuski, a spokesman for Federated Department Stores Inc. In addition, two Foleys stores in Baton Rouge, one in Lafayette, La., and one in Lake Charles, La., are now part of Federated, since the company’s merger with May Department Stores Co. was completed last week.
A J.C. Penney store in Gretna, La., appears to be heavily damaged and won’t be open for a while, said a company spokesman. Six Penney stores remain closed, three in and near New Orleans and three in Biloxi, Miss.
Penney’s has a process in place for continuing to pay associates. The company contributed $350,000 to the American Red Cross Disaster Relief Fund and established a relief fund for associates with matching contributions.
“New Orleans is our only department store still closed due to the hurricane,” said Julia Bentley, a spokeswoman for Saks Inc. The Saks Fifth Avenue store sustained serious fire damage. “I can’t give you any information at this time about the future of the location.”
— also by Georgia Lee
Newhouse Foundation Donates to Hurricane Relief
The Samuel I. Newhouse Foundation said on Tuesday that it donated $1 million to the American Red Cross for the Hurricane Katrina relief effort. “We are happy to respond to the extraordinary relief challenges by supporting the humanitarian role” of the Red Cross, said Donald E. Newhouse, president of Advance Publications. The Times Picayune of New Orleans has been part of Advance Publications since 1962. WWD is also a unit of the company.