RETAILING : Competition Among County Retailers to Increase This Year, Forecast Says

Orange County retailers will have to fight harder for shoppers’ dollars this year, but there still should be plenty of business to go around, Laventhol & Horwath said last week in its annual forecast.

The accounting firm cited a slowdown in the growth of household income in 1988, at least in the early part of the year, as one reason for the tougher competition. In addition, consumer spending increased at a slower rate during 1987.

On the other hand, the report notes, “substantial new household income” should continue to grow, positioning Orange County as one of the nation’s best retail markets this year, the report states.

With major face lifts and expansions planned at several Orange County malls, retailers will have to pay more attention to frills such as unusual merchandising and layouts, Laventhol said.

Val P. Keller, retail specialist, said retailers also can expect a stabilization in rental rates and a slight upswing in vacancy rates because of record retail construction over the past two years. That upswing, in turn, should bring a more favorable tenant market in the last half of 1988.

Keller noted that a large chunk of the county’s development and retail inventory is concentrated in neighborhood and community shopping centers.

In 1987, Orange County had almost 70 of those mini-shopping centers, which typically are 100,000 to 250,000 square feet with promotional anchors such as Circuit City, Price Club or Home Depot, chains that emphasize high volume and discount. Another eight centers contain more than 250,000 square feet.

“What’s really making them go is dual-income households,” Keller said. “Now that women are working, they’re looking for convenience when doing their shopping. Instead of driving to the nearest mall, they’d rather see a neighborhood community center have the same shops.”