1. R. Michael Goman Acting Co-Director Center for Real Estate University of Connecticut November 2010

2. Scope of Retail in CT

3. November 2010 Retail: Consumer confidence: remains low Sales: remain mixed Women’s apparel at ‘04/’05 levels Shoppers returning: +3.7% to June Back to school – mixed Holidays ’10 – cautious optimism

4. November 2010 Retail: Hourglass effect: Luxury & Discount categories Reduced inventories: markdowns dropping Less focus on cutting expenses Anticipating top-line growth, again Newer store concepts being expanded

5. November 2010 Retail: Overall vacancy – September – 7.4% Slight improvement – Malls/Neighborhood centers Quoted asking rates continue to be down – 4.28% since Q3-09: $16.14 Q3-09 $15.57 Q1-10 $15.38 Q2-10 $15.18 Q3-10 Expanding retailers: PC Richards, Ulta3, rue 21, Sonic, Checkers, HHGregg, Tractor Supply, Lumber Liq., SYMS, dollar formats Market opportunities: gain better positioning – EMS, Costco, Target; smaller/local retailers

6. November 2010 Retail: Investment/sales activity: lots of buyers, few sellers A properties getting good cap rates C properties being sold at deep discounts B properties not moving: Bid/ask mismatch Further fallout expected: Operating defaults Maturity defaults Construction loans

7. November 2010 Retail - Factors to Watch: Absorption: adaptive re-use Development - <1% LY Fundamental changes in consumer behavior Aging Boomers: time focus: travel, learning Spending focus: comfort, health/fitness, hobbies, investments, retirement Priority of time = convenience CT’s shifting demographics

8. November 2010 Retail - Factors to Watch Less “indulgence” spending Internet retail Convergence of retail & bricks & mortar channels Consumer confidence & spending: Unemployment, housing prices, lost wealth, low wage increases Government policies/political turmoil

9. November 2010 Industry Issues: New government regulations/policies Cap & Trade IASB/FASB changes re: real estate leases V.A.T. Green: GBC Retail Streamlined Sales Tax CRE Act

10. November 2010 Summary - Challenges: CT’s demographics: a flat market Continuing vacancies Low demand Tenant concessions, shorter terms Projection: long, slow recovery

11. November 2010 Summary – Opportunity: Not much new development High barriers to entry Fundamentals: Leasing, management, marketing Demographics: CT’s solid, stable markets Sales productivity Redevelopment opportunities

12. R. Michael Goman Acting Co-Director Center for Real Estate University of Connecticut November 2010