BUSINESS OUTLOOK: MAY EXEC: RETAIL SALES `SOFT'

Some economists say the recession ended in April or May, but many retail businesses that depend on consumers may disagree.

"The softness in the retail market is continuing," said William E. Grafstrom, who doesn't see any quick cure for an ailing economy in the U.S.

"A lot of retailers have had some difficulties during the past year," said Grafstrom, chairman of May Centers Inc. Grafstrom was a visitor to West Park Mall in Cape Girardeau Wednesday. "Consumers are still cautious and they've curtailed some of their spending."

Grafstrom, and Roger D. Burghdorf, senior vice president, director of leasing for May Centers, are visiting May Center properties.

"We feel that it's important to visit with the people who lease from us," said Grafstrom.

May Centers Inc. has 26 centers throughout the U.S.

"There were some bright expectations this year," said Grafstrom. "But, there's still a high level of uncertainty."

Grafstrom said he had a wait-and-see attitude about the economy for the rest of the year.

"I know there's some optimism that things are improving, but we could be looking at another year before we start to see a turn-around," he said. "You can pick up the Wall Street Journal almost any day and read about some plant closing, or some company making employee layoffs."

One Southern Illinois community received a double jolt recently. According to the Journal, 200 people were laid off earlier this year at SnyderGeneral Corp. at Red Bud, Ill. In July, the area received an economic boost when the 200 workers were recalled. But two weeks ago, depression set in again when the plant was sold to a Canadian firm which has said it will shut down the factory.

The U.S. economy "shrank" at a 0.5 percent annual rate during the second quarter, according to final figures. The government had initially estimated 0.4 percent growth, then re-evaluated its forecast to a 0.1 percent drop.

"Things like this dampen all consumers confidence, and a lot of people hesitate to spend," said Grafstrom. "They find ways to economize on what they do buy."

He added that some retailers are even cautious about the Christmas season at this point.

Grafstrom said he was seeing some positive things, however, in Cape Girardeau.

Burghdorf said no less than 20 stores in West Park Mall have increased sales in excess of 10 percent during the past year. "In fact, some of these businesses saw increases of up to 30 percent, and a couple even more," he said.

Grafstrom said, "Overall, the mall's sales here are up about 5 percent over a year ago. Other May properties 26 in the U.S. and other mall developers are running closer to the national average of 1 to 2 percent below last year."

"Some retailers are doing very well," said Grafstrom. "What we're seeing is that newer companies, and those with new ideas and promotions show good performances."

"Limited and Gap have shown very strong performances at West Park Mall," he said. "Lerner New York, a division of Limited, is proof that retailers, which provide new and fresh merchandise and ideas, attract consumers. Lerner recently doubled its size here, and during the first week of reopening, led its district in sales."

Several other stores at West Park Mall will receive new looks within the next year.

"One of the things we're looking at is the location of a new `Everything's A Dollar' store here next month," said Grafstrom. "They're working now to get everything ready for opening late this month or in early November."

Burghdorf said, "Several companies here are in the process of remodeling and expanding their leases." He mentioned Radio Shack, Payless Shoes, Waldenbooks, Camelot Music, Carimar Jewelers, and A & W Root Beer.

"We're also working with more than 20 additional tenants who have indicated an interest here," said Burghdorf.

He added that 78 of the 91 stores in the mall are filled. "Counting the larger anchor stores, about 90 percent of the space at West Park Mall is occupied," said Burghdorf.

Grafstrom and Mall Manager Anthony (Tony) Stephens commented on the recent opening of Illinois Centre Mall in Marion, Ill., and expansions at University Mall in Carbondale, Ill.

"Sales at this mall are good," said Grafstrom. "The three anchors Famous Barr, Venture, and JCPenney are strong, and we don't see any differences for the future."

Stephens said, "People come to Cape Girardeau for four big reasons. They come here for West Park Mall, they come for the city's great medical facilities, they come for the university, and they come for the variety of restaurants we have here.

"I don't think people will be changing their habits," added Stephens. "Our regional impact will remain."