Retail data still strong
Local economy tries to thwart recession
By John Loesing  newstip@theacorn.com

The slumping Conejo Valley housing market can expect little relief in 2008, a stark contrast to the area's retail business environment, which continues to see signs of growth and prosperity, experts said last week at an economic forecast breakfast in Westlake Village.

Because commercial real estate builders, unlike their counterparts in the residential sector, did not add excessive inventory during the past five years, the vacancy rate for stores and restaurants remains low and businesses are growing. Retail vacancies are only about 2 to3 percent in the area between Agoura Hills and Thousand Oaks, and the vacant land to build new stores is scarce, the experts said.

"Everyone wants to invest where they live and this where they want to live," commercial real estate broker Rick Principe said at the annual outlook conference put on by the Thousand Oaks/Westlake Village Chamber of Commerce.

Lack of inventory is the commercial sector's major concern, Principe said.

Even though the Marie Callender's restaurant on Thousand Oaks Boulevard went out of business, another tenant is ready to step in, he said.

The Promenade in Thousand Oaks will undergo a $12-million face lift that includes the addition of two restaurants, said Rick Lemmo of Caruso Affiliated, the shopping center's owner.

New commercial projects opening this spring include a neighborhood shopping center for Dos Vientos in Newbury Park and an eight-building, 450,000-square-foot office complex in Westlake Village.

In Agoura Hills, several businesses will be opening soon at the large, multistore furniture mart on Canwood Street.

Lemmo forecasts a strong year for Conejo Valley retailers.

"Will our percentage of increase be less than the year before? Yes, but there will be an increase," Lemmo said.

Demand for luxury goods in the high-income Conejo Valley region remains strong, he said, and talk of a recession isn't much heard. "A soft landing for us is just not as much of an increase," Lemmo said.

A strong retail sector helps negate the poor showing by homes, said Philippa Klessig, Westlake Village mayor.

"We are not buffeted by the state's financial storm," Klessig said. "We don't have to wait for a great uncle to die to get funds."

The city's sales tax revenue has doubled from 1997 until the present, she said, and during the coming year Westlake Village will invest $4 million on public improvements.

Thousand Oaks Mayor Jacqui Irwin gave a similarly optimistic forecast for her city's economy.

While T.O.'s sales tax revenue is off 2 percent compared to last year--due mainly to a slump at the auto mall--the city's retail vacancy rates are near historic lows, Irwin said.

Residents said in a survey that the business they'd like to see come to town the most is a bowling center, Irwin said.

Concerning employment, the job layoffs at Countrywide are mainly affecting Westlake and Simi Valley, not Thousand Oaks, Irwin said.

Keynote speaker John Paglia, Pepperdine assistant professor of finance, warned that even though the area's unemployment rate remains well below the countywide level of 5.7 percent, recession is still a concern.

"People get nervous about their jobs and they constrict their spending activity," Paglia said.

The biggest worry locally is the steady decline in home values. The Conejo Valley's drop of 15 to 19 percent in single-family median prices exceeded the county's decline of 13 percent in 2007, a report from Pepperdine's Graziadio School of Business and Management shows.

At what point the prices will stabilize is anybody's guess.

"It seems like a bottom is called month after month," Paglia said.