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Retail Markets With the Most Promise

Monday, 7 Dec 2009 | 12:46 PM ET

Even retail is bigger in Texas.

Christmas tree in Galleria Mall in Houston, Texas
Panoramic Images | Getty Images
Christmas tree in Galleria Mall in Houston, Texas

Using a software tool called MarketPulse, Pitney Bowes Business Insights has determined the ten U.S. markets that it expects hold the most promise for retailers over the next six quarters.

Topping the list is Austin, Texas, which the firm cites for its "consistent healthy growth" in gross metropolitan product and personal disposable income.

"Austin tops our list in all of the retail sectors we examined for sustained retail sales growth," the company said. "As we look forward to the next six quarters, Austin also places in the Top Five markets for all retail sectors we examined."

With the exception of Baltimore, which ranks second, the remaining top five cities also are in Texas. They are: Houston, in third; Dallas, in fourth; and San Antonio, in fifth place.

"The Texas markets have been very resilient throughout the recession," said Devon Wolfe, the company's managing director of Americas strategy and analytics for retail, restaurants and real estate.

According to Wolfe, the housing market never overheated as much as boom markets of California and Florida.

"They never had the housing calamities or the dive in employment," Wolfe said.

The job market is an important factor. In fact, the expected increase in government jobs was a key part of the forecast for Baltimore, helping to lift it to its second-place position, and also for Washington, D.C., which ranked sixth.

Both Seattle and Kansas City, benefited from having a diversified employment base.

"Although Seattle's employment continues to soften from the growth seen in 2007 and 2008, this market was able to maintain respectable comparable sales for the last six quarters in all retail sectors," the company said. Looking ahead, Seattle should continue to see increases in its gross metro product.

A full rankings follows:

Most Promising Retail Markets

Ranking Location
1. Austin, Texas
2. Baltimore, Maryland
3. Houston, Texas
4. Dallas, Texas
5. San Antonio, Texas
6. Washington, DC
7. Seattle, Washington
8. Kansas City, Missouri-Kansas
9. Providence-New Bedford-Fall River, Rhode Island-Massachusetts
10. Columbus, Ohio
source: Pitney Bowes

To compile the research, Pitney Bowes Business Insight used MarketPulse to analyze current and forecasted macroeconomic and demographic data and sales history. For this listing, the firm looked at sales results for the past six quarters and then estimated the sales growth for the large metropolitan markets over the next six quarters.

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