On September 15th, Walmart launched Walmart+, an online paid membership service that will compete directly with Amazon Prime for the growing population of shoppers on the web who crave faster delivery options. The two loyalty programs hit similar price points: Amazon Prime is $119 per year or $12.99 per month, including a 30-day free trial, whereas Walmart+ memberships cost $98 per year or $12.95 per month, including a 15-day free trial. The programs also have similar benefits relating to selection and speedy delivery. This is only the latest flashpoint in this rivalry of retail titans, but another battle, again involving speedy order fulfillment is brewing and hints at where at least one battleground in this competition will be in the future: autonomous drone delivery.
In its race to the skies, Walmart is now partnering with two businesses, Zipline and Flytrex, to explore what drone delivery may look like in the future. Zipline currently operates mostly in Africa, delivering critical medical supplies into the rural villages of Ghana and Rwanda. Zipline has gained access into U.S. airspace as the FAA recently granted Zipline-operated drones the ability to distribute supplies to medical personnel in North Carolina. Meanwhile, Walmart’s pilot project with Flytrex will focus on the delivery of grocery and household products.
Despite these recent developments, Walmart trails Amazon in the drone delivery race. Amazon’s Prime Air delivery drone fleet recently received special approval from the FAA to operate “beyond the visual line of sight” (BVLOS) of the operator. Walmart’s drone pilot programs are a step in the right direction, but Amazon’s BVLOS approval puts it firmly a step ahead.
Despite the optimism in and current testing of autonomous delivery drones by companies such as Walmart and Amazon, there are several hurdles that will need to be cleared before drones are delivering products to shoppers on a regular basis. The FAA dictates that aircraft flight – including that of drones – must meet certain guidelines. As previously mentioned, one of the key rules for drones is the BVLOS regulation, or that all drone pilots, unless granted a special exemption, must always be able to see their drone while in flight.
FAA regulations also note that drones cannot fly above people without mitigating the risk of a fall or crash with parachutes and protective bubbles. This regulation is cumbersome and costly for manufacturers. Other FAA rules that Walmart and Amazon will struggle to overcome include weight and altitude limits for drones. The maximum weight for drones at take-off is 55 pounds and drones may never fly higher than 400 feet above the ground. For autonomous drones to effectively deliver products to customers all over the country, companies like Walmart and Amazon will need to innovate drone designs, or at least partner with drone manufacturers who can solve these problems.
The FAA’s “crawl, walk, run” approach to drone regulations leads many to believe that commercial drone delivery is still years away from becoming an effective, every-day alternative to gas powered vehicle delivery. As U.S. aviation authorities continue to develop rules and regulations to ensure safe transport, big companies like Walmart and Amazon will continue to develop their drones, test for safety, and add distribution centers. With 90% of the U.S. population currently within 10 miles of a Walmart and 50% of the U.S. population within 20 miles of an Amazon warehouse, these businesses will be ready to capitalize on the shipping speed and efficiency of drone delivery. Once they have crawled, walked, and ran, the next step will be flight.
Headlines of the Week
Here’s everything Amazon announced at its latest hardware event
From new Ring flying indoor drone cameras to an adorable new kids version of one of its most popular Amazon home products, Jeff Bezos’ Seattle retailer unveiled a slew of new hardware goodies just ahead of the holiday shopping season. Amazon kicked off its latest hardware showcase by unveiling a new version of the company’s Echo devices, which now include spherical speakers (with a version for kids featuring cute animal graphics). Ring also had plenty to pitch at the Amazon hardware show. The company’s TV platform got several updates. Last, but certainly not least, Amazon announced its new game-streaming platform, Luna.
Nike’s online business is booming — ‘digital is here to stay,’ CEO says
Nike is proving during the pandemic that its big bets in digital are paying off, as consumers are turning to its website and app in record numbers to shop for sneakers and workout apparel. For the past few years, the company has been pulling away from department stores and other wholesale outlets, instead investing in opening its own smaller neighborhood stores, called “Nike Live,” to serve as pickup hubs for online orders, alongside multilevel flagship locations dubbed “House of Innovation”. Even as most of its stores were reopened, Nike’s digital sales soared 82% during the fiscal first quarter, pushing revenue ahead of analysts’ estimates. Before the Covid-19 crisis, Nike had set a goal of having its e-commerce sales represent 30% of total revenue by 2023. But it has already exceeded that.
Apparel & Footwear
Ascena clears hurdle into final stretch of Ch. 11 reorganization
Ascena is headed into the final phases of its reorganization that will leave it a different-looking company. When all is said and done, Ascena’s go-forward footprint will consist of roughly 1,300 stores, though it is still negotiating with landlords, CEO Gary Muto said in a press release. Making up the retailer’s remaining stable of banners are Ann Taylor, Loft, Lane Bryant, Justice and Lou & Grey. In some sense, Ascena used the bankruptcy process to undo parts of an ill-fated expansion earlier in the decade. Under Ascena’s bankruptcy plan, it will get around $1 billion in debt relief by converting loans into equity in the company, turning control over to lenders in the process. The company said that the plan has the support of 95% of its secured term lenders, a key voting group.
Stitch Fix shares dropped by more than 14% in after-hours trading Tuesday as the company reported steep losses for the fiscal fourth quarter. The online personal styling service reported a fourth-quarter loss of $44.5 million, or 44 cents per share, compared with earnings of $7.2 million, or 7 cents per share, a year ago. Revenue in the quarter rose to $443.4 million, an increase of about 11% from $432.1 million a year prior after adjusting for an extra week in the fourth quarter of 2019. Stitch Fix’s active clients grew to 3.5 million, up 9% year over year. The company — a styling service that sells boxes of clothes that people pay to keep, or return, on a subscription basis — rebounded from a difficult fiscal third quarter. Sales dropped by 9% in that quarter as it was hampered by backlogged orders due to the coronavirus pandemic.
Ann Taylor parent sells Catherines for $40.8 million
Ascena Retail Group Inc., whose banners include Ann Taylor, Loft and Lane Bryant, is selling its plus-size Catherines brand for more than double what it was originally offered. In a filing, Ascena, which filed for bankruptcy in July, announced the winning bid of $40.8 million from FullBeauty Brands Operations LLC for Catherine’s intellectual property assets and e-commerce business. FullBeauty, whose portfolio includes various plus-size brands, outbid City Chic Collective Ltd., which had made a stalking-horse offer of $16 million. FullBeauty is owned by Apax Partners and Charlesbank Capital Partners. In its bankruptcy filing, Ascena announced plans to shut down Catherines and sell the brand’s intellectual property assets to City Chic. City Chic is now the back-up bidder, with a $39.9 million offer.
Crew is set to close all of its UK stores
American retailer J. Crew, a label known for its preppy style and A-list fan base (including perhaps most famously, former first lady Michelle Obama), is set to shut all of its UK stores. The company has announced the decision to close six stores and its UK headquarters after suffering financial trouble – and has decided instead to service UK customers through its global online platform. J. Crew has been struggling financially for some time but has been pushed over the edge by the Covid-19 pandemic, forcing the retailer to file for bankruptcy in May. It has not yet been announced how many of the brand’s 500 stores worldwide will close, but the decision has been taken to close all UK stores.
Athletic & Sporting Goods
Compass Diversified to Acquire Performance Fit Innovator BOA Technology
Compass Diversified, an owner of leading middle market businesses, announced that it has entered into a definitive agreement to acquire BOA Technology Inc., creators of the award-winning BOA® Fit System, delivering superior fit and performance in the Outdoor, Athletic, Workwear and Medical Bracing markets worldwide, for a purchase price of $454 million (excluding working capital and certain other adjustments upon closing). BOA was founded in 2001 with a revolutionary performance fit system that transformed how snowboarders “dialed in” their boots and offered a superior alternative to the traditional lace system. Nearly two decades later, the BOA Fit System has become the leading performance fit solution integrated into market-leading premium brand partner products across an array of segments, including snowboarding, cycling, golf, trail, hiking, mountaineering, running, court sports, workwear and medical.
Modell’s Submits Liquidation Plan
Modell’s Sporting Goods Inc. filed its Chapter 11 liquidation plan that calls for unsecured creditors to recover less than 1 percent of their claims. The retailer entered bankruptcy proceedings with a plan to liquidate all its 134 stores while continuing to explore a recapitalization of the business through a potential sale of some or all of its assets or equity investment to revive the business. The emergence of the pandemic particularly challenged efforts to find an investor and also delayed liquidation sales. On August 10, Retail Ecommerce Ventures, led by digital entrepreneurs Dr. Alex Mehr and Tai Lopez, acquired Modell’s intellectual property and other assets related to its e-commerce business, for $3.7 million.
Regymen to open fitness centers in Canada
The first Regymen Fitness location in Canada is set to open this month through a partnership between the Baton Rouge based company and GoodLife Fitness, the world’s fourth largest global fitness brand. GoodLife, which has more than 400 locations in Canada, has purchased a small stake in Regymen along with the rights to own and operate the brand across the country, said EK Navan, Regymen co-founder and chief strategy officer. This will lead to more than 200 Regymen locations opening in Canada over the next 5 years, Navan said.
Cosmetics & Pharmacy
Rite Aid beats expectations in Q2
Rite Aid’s second-quarter fiscal 2021 results beat Wall Street expectations as the retailer saw double-digit revenue growth and an increase in its market share while reducing its net loss. For the quarter ended Aug. 29, Rite Aid posted net loss of $13.2 million — a narrowing of $65.5 million from the prior-year period. Revenue totaled $5.98 billion, an 11.5% increase over the prior year’s Q2 driven by growth in retail pharmacy and pharmacy services revenues. In the company’s retail pharmacy segment, revenue grew by 4.4% year over year, with same-store sales up 2.5% from the prior-year period. Sales growth was driven by a 4.6% increase in front-end sales and a 2.3% increase in pharmacy sales. Front-end same-store sales, excluding cigarettes and tobacco, increased by 6.1% as its front-end market share saw 130 basis points of growth in dollars and 150 basis points in unit sales.
La Bouche Rouge Raises 2.5 Million Euros
Eco-luxury beauty brand La Bouche Rouge has raised 2.5 million euros of funding from Bpifrance and some business angels, the French public investment bank said in a statement. The investment is meant to help accelerate La Bouche Rouge’s digital strategy as part of its omnichannel reach; enter new markets with strong potential, such as China, and continue launching makeup and skin-care products. Thirty-six-year-old Nicolas Gerlier, a L’Oréal veteran, founded La Bouche Rouge in 2017 with the aim of creating the first cosmetics brand worldwide to ban microplastics and plastics from everything including product formulation, manufacturing and selling. Following a few years of research and development in its laboratories in France’s Cosmetic Valley, near Orléans, La Bouche Rouge came out with lipsticks containing no microplastics or ingredients Gerlier considered unhealthy. The lipsticks are also vegan, cruelty-free and in recyclable, refillable packaging. There’s a charitable component, too. Each time a La Bouche Rouge lipstick is sold, the brand supplies 100 liters of safe drinking water to the association Eau Vive International.
Discounters & Department Stores
Walmart to offer sellers credit lines through Goldman Sachs
Walmart on Tuesday announced that it will provide eligible third-party sellers with lines of credit offered through Marcus by Goldman Sachs. For now, sellers can apply for credit lines between $10,000 and $75,000, but the company plans to increase the maximum line of credit available for sellers in the future, according to the company press release. According to the Walmart Marketplace website, sellers can request funds as needed over a 12-month draw period with fixed interest rates ranging from 6.99% to 20.99%. Per the company press release, the most creditworthy sellers will have access to the lowest interest rates.
New Brands Now Available at Kohl’s with Curated by Kohl’s
As Kohl’s customers start their holiday shopping even earlier this year, our new Curated by Kohl’s assortment is being refreshed this fall with fourteen new brands, including everything from clothing with a cause, to inspired jewelry and cozy home goods. Based on popular demand, Kohl’s will also continue to offer current Curated by Kohl’s brands Lovepop, which offers laser-cut pop-up greeting cards, and Citrus & Lemon, a clothing collection that makes women feel comfortable and confident.
Target to hire 130,000 holiday workers, in line with last year, but jobs will focus on online orders
Target said Thursday that holiday hiring will be in line with last year, but it is rethinking its approach to roles for those workers to adapt to customers’ new shopping habits during the coronavirus pandemic. Twice as many Target employees will be dedicated to same-day curbside and in-store pickup of online purchases compared with the first half of the year. Distribution centers will have more workers than last holiday season to make sure stores don’t run out of popular items. Some workers will focus on safety and cleaning. And across stores, employees will be cross-trained so they can switch from task to task as needed, from disinfecting shopping carts to helping with curbside pickup during peak hours.
Neiman Marcus Group plans store layoffs in pivot to e-commerce
Neiman Marcus Group on Wednesday “began a reorganization of our Neiman Marcus and Bergdorf Goodman store associate structure,” and plans layoffs of “selling and non-selling associates,” a company spokesperson confirmed on Thursday. The spokesperson declined to say how many people or which locations are affected. The changes are “substantial,” according to Women’s Wear Daily, which first reported the news after obtaining a letter from CEO Geoffroy van Raemdonck to vendors. Some involve restaurant workers who may be hired back eventually, according to WWD’s report.
Emerging Consumer Companies
Art of Sport raises $6 million
Art of Sport, the Los Angeles-based unisex personal care brand, announced a $6 million funding round designed to fuel its retail expansion. The investment was led by CircleUp Growth Partners, with participation from Mark Cuban, Lightspeed Venture Partners, Bam Ventures, Darco Capital, and NBA veteran Wilson Chandler. The brand is currently sold on its own website, on Amazon, and in Target, and is planning to expand to other retailers. The company hopes to do in the skincare and grooming category what Nike has done in apparel.
Daring Foods, plat-based chicken brand, raises $8 million
Scotland’s daring Foods, maker of plant-based chicken, announced an $8 million Series A. The investment was led by Maveron and will further its mission to remove chicken from the food system. The company also announced the launch of its new product, Breaded daring Pieces. Founded in 2018 and launched in the U.S. in 2019, daring’s chicken products are made of five simple ingredients.
Laird Superfood, the plant-based food and beverage brand founded in 2015 by its namesake, professional surfer Laird Hamilton, made its public debut on the New York Stock Exchange. The company saw $13.1 million in revenue in its most recent fiscal year, and although it’s available in more than 5,500 stores, the majority of sales came online. The company makes a line of creamers, coffees, and hot chocolates with plant-based ingredients and no artificial flavors or colors.
Grocery & Restaurants
Congressional leaders from Washington state, Illinois and Pennsylvania took aim at third-party delivery operators this week, calling for the Federal Trade Commission to investigate the companies for alleged unfair practices tied to fee structures amid consolidation in the sector. “COVID-19 has made restaurants increasingly reliant on food delivery platforms as measures to reduce the spread of the virus continue to limit in-person dining,” according to the Sept. 22 letter signed by U.S. Representatives Jan Schakowsky, Mary Gay Scanlon and Pramila Jayapal. The leaders said the FTC needs to scrutinize the “harmful impact” these companies have on small businesses and consumers. The leaders said independent restaurants are especially vulnerable amid recent consolidation in the delivery sector.
The Crack Shack to reach up to 50 locations with Savory investment
After opening the first The Crack Shack to overwhelming success in San Diego, founder Mike Rosen began expanding the modern fried chicken concept to new markets. But Rosen realized the growing pains of building restaurants to scale. Now, those details are in the hands of Savory. The $90 million growth fund, created earlier this year, announced plans Tuesday to invest in the six-unit Crack Shack. Over the next four to five years, Savory plans to expand the Southern California-based brand to up to 50 units in five to seven new markets including the Midwest. The fund’s investment comes with leadership guidance from industry veterans. The team will assist Savory’s portfolio of brands with real estate selection and negotiation, leadership training and development, supply chain/procurement, human resources, accounting, strategic financial planning, facilities management and sales and marketing.
FAT Brands completes acquisition of Johnny Rockets from Sun Capital Partners for $25 million
Global franchising company FAT Brands — global franchising company and owner of Fatburger, Hurricane Grill & Wings and Ponderosa and Bonanza Steakhouses — has completed the acquisition of retro diner brand Johnny Rockets that was first announced in August. The acquisition, which was valued at $25 million, increasing the company’s securitization facility to $80 million. The acquisition will bring the total number of FAT Brands franchised and company-owned restaurants to 700 internationally, with annual sales of $700 million. As previously announced, former Johnny rockets CEO George Michel will not be continuing on with the company, and instead FAT Brands CEO Andy Wiederhorn will be heading the brand.
Home & Road
Herman Miller to unveil new store concept that leverages work-from-home trend
Herman Miller is expanding its retail presence. The design-driven office and home furniture company plans to debut a new retail format dedicated to high-performance “task” chairs and other products that support the home office. The first locations are expected to open in fall. The stores will carry the full-range of Herman Miller’s home office product categories. “We are currently seeing unprecedented sales across these categories,” said Debbie Propst, president of Herman Miller Retail. The stores are a direct response to our collective need, which has been building over time and heightened by the pandemic, for more versatile home environments and our customer’s desire to test drive these highly-considered products in person.” Herman Miller made the announcement on the heels of strong first-quarter, with revenue and earnings that blew past Street estimates.
Lowe’s rolling out pickup lockers chainwide
Lowe’s Companies is expanding a new self-service option for customers picking up online orders at its stores. The home improvement giant plans to install pickup lockers at all its 1,700-plus U.S. stores by the end of March 2021. The self-service lockers are already in place in select Lowe’s locations, including Charlotte, Philadelphia and the tristate area of New York, New Jersey and Connecticut. In the coming weeks, the rollout will expand to Florida, Washington and Texas. Lowe’s plans to have the lockers installed in most major metro markets by Thanksgiving. Lowe’s is leveraging the retail locker solution from package management technology provider Parcel Pending by Quadient. Here’s how the system works: After a store employee stages an online order, the customer receives an automated email notification with a one-time user barcode. The customer then completes the pickup by scanning the barcode at the locker using their smartphone without having to wait in line, receive assistance from a store employee, or engage with a touchscreen or keypad.
Jewelry & Luxury
Tiffany, LVMH Butt Heads in First Court Hearing
At a Sept. 21 hearing, counsel for Tiffany and LVMH differed strongly on whether the two parties’ 2019 merger agreement should go through as planned, as a Delaware judge said the case will go to trial in January. Tiffany had wanted the case heard in mid-November, given the deal was set to close on Nov. 24. Its attorney, Richard C. Pepperman, partner at Sullivan & Cromwell, argued that the ongoing uncertainty has left Tiffany in limbo, as the deal requires LVMH consent to any senior-level Tiffany personnel moves, as well as material contracts, like leases.
Diamond Price List Hopes to Be Industry-Wide Resource
A new diamond price list hopes to become an industry-wide resource that will tally data from many different sources. The Natural Diamond Price Guide, developed by fintech company Uni.Diamonds, is calculated using price data from 90 manufacturers and dealers as well as online exchange Idex. That amounts to 1,200 searches a week, representing about $5 billion in inventory. The hope is to bring more major players on board, says UNI’s CEO, Mahiar Borhanjoo, a former De Beers sales director.
Coronavirus and luxury retail: Shopping for used Hermes, Cartier in Covid era
No matter what it’s called — resale, re-commerce, luxury consignment or pre-loved — the market for secondhand fashion was booming before the Covid-19 pandemic upended the lives, and financial security, of millions of people. All those clothes in your closet? The ones you haven’t worn in years, but just can’t bring yourself to get rid of, or even donate? Well, how about selling them? A growing number of consumers in recent years were beginning to view the items in their wardrobe not just as a means of expressing their personal style, but as valuable, tradable assets.
Office & Leisure
Party City to open 91% fewer Halloween pop-ups this year
Party City plans to open just 25 pop-up stores under its Halloween City banner this year as it navigates a holiday disrupted by the pandemic, according to a press release issued Tuesday. The number of stores represents a 91% reduction compared to last year’s announcement of 275 Halloween pop-ups. Hiring for the holiday declined at a slower pace. For this year Party City plans to hire 20,000 temporary employees for the Halloween season, which is down 20% from 2019. A company spokesperson said that each store would have four to five additional employees compared to previous years to assist with omnichannel services, such as curbside and buy online, pickup in-store. Even if 2020 were a normal year, Party City would face a challenging Halloween this year. Last year brought a steep decline in its Halloween City sales. Its performance during October was so surprisingly bad it sent investors fleeing when the company announced it.
Playboy explores deal to return to the stock market
A deal with a blank-check firm – referred to on Wall Street as a special purpose acquisition company (SPAC) – would result in Playboy’s return to the stock market, nine years after it went private in a $207 million deal led by its late founder Hugh Hefner and private equity firm Rizvi Traverse Management. Since then, the company’s print sales have fallen further. The COVID-19 pandemic compounded its challenges, leading Playboy earlier this year to stop printing the magazine, ending a nearly seven-decade run on newsstands that began in 1953 with a debut issue featuring Marilyn Monroe. Playboy is working with an investment bank to engage in discussions with a potential SPAC buyer, the sources said. A deal, if one is reached, would give Playboy access to money it needs to finance growth initiatives that it otherwise might not be able to tap, one of the sources said. Hefner, who founded Playboy in 1953, died in 2017 at the age of 91. His family sold a 35% stake in Playboy to Rizvi Traverse for $35 million in 2018, according to PitchBook data.
After 6 months and $1.8 billion, Quibi wants a new owner. That will be a hard sell.
Quibi was supposed to be revolutionary: A video service that was supposed to fill the gap between YouTube and HBO by bringing short, “premium” clips starring celebrities like Liam Hemsworth and Chrissy Teigen to your phone, for a price. But that was in the spring. Now, Quibi might be headed to a fire sale: Just six months after launching — and after raising $1.8 billion — Quibi has started looking for a buyer. It’s a stunning admission that the high-profile service hasn’t found enough traction to continue on its own. Quibi CEO Meg Whitman and Quibi founder Jeffrey Katzenberg have already pitched at least one potential acquirer in the last week, industry sources told Recode. The Wall Street Journal previously reported that Quibi was considering options including a sale, raising more money, or going public by backing into a shell company.
Technology & Internet
Shopify says ‘rogue’ employees stole data from merchants
Shopify Inc. said two employees stole data from more than 100 merchants, potentially exposing the personal information of consumers who shopped on web stores that use the company’s ecommerce software. “Rogue members” of Shopify’s support team were involved in a scheme to obtain customer transactional records from some of the merchants, the company said in a blog post that noted fewer than 200 sellers were affected. Shopify terminated the two employees’ access to its network and the company is working with the Federal Bureau of Investigation and other international agencies that are investigating what it called “criminal acts.” The hacked stores may have had customer data exposed, including emails, names, addresses and order details, the company added. Complete payment card numbers or other sensitive personal or financial information were not part of the incident, Shopify said.
Commerce technology firm Salsify gets $155 million
Salsify Inc. reports strong growth in demand for its technology that helps brand manufacturers display accurate and engaging product content across multiple digital selling channels. Its investors are backing up its growth strategy with $155 million in new venture capital announced today by Salsify and Warburg Pincus, which led the Series E funding round. Salsify serves “some of the largest and most discerning global brands and retailers,” said Vishnu Menon, managing director, Warburg Pincus, in a prepared statement. “The company’s strong track record, paired with a talented leadership team has positioned it well for the increase in demand for digital shelf solutions.”
Trump approves TikTok deal. But big questions remain
Who controls TikTok? Is the social media platform safe? Has a US ban been averted for good? President Donald Trump’s attempts to force a quick sale of popular Chinese-owned video app TikTok produced a tentative deal over the weekend that would see Oracle and Walmart take a minority stake in a new US company that will operate TikTok. The US Department of Commerce pushed back a threatened ban on US downloads of the app by one week, to the end of the day on September 27. But as the companies race to finalize the proposal, crucial questions over data security, national interest and the deal’s structure remain unanswered. What is clear is that the fight over TikTok is bigger than who owns an app popular with Generation Z. It’s also about the future of US-China relations, and the rough new terrain businesses are forced to navigate as tensions between the world’s two biggest economies ramp up.
Finance & Economy
Retailers have started paying rent again but are still fighting with their landlords
Month by month, retailers are starting to pay more rent as states lift shutdown orders and consumers become more comfortable venturing out to shop during the coronavirus pandemic. But negotiations, sometimes heated, continue between tenants and landlords. Tensions keep brewing, as mall and shopping center owners grapple with retailers looking to close stores permanently, downsize or try to rewrite contracts in their favor. And the pressures are likely to roll into 2021, with the start of the year typically drawing a fresh wave of retail store closures as companies reevaluate their brick-and-mortar footprints after the holidays. Less than a third of companies paid at least 75% of June rent, according to a study released by the National Retail Federation and the investment bank PJ Solomon. By July, the number of rent payers had almost doubled to 65%, it said.
U.S. new home sales rise to near 14-year high
Sales of new U.S. single-family homes increased to their highest level in nearly 14 years in August, suggesting the housing market continued to gain momentum even as the economy’s recovery from the COVID-19 recession appears to be slowing. The Commerce Department said new home sales rose 4.8% to a seasonally adjusted annual rate of 1.011 million units last month, the highest level since September 2006. New home sales are counted at the signing of a contract, making them a leading housing market indicator. July’s sales pace was revised upward to 965,000 units from the previously reported 901,000 units. Economists polled by Reuters had forecast new home sales, which account for more than 10% of housing market sales, slipping 1% to a rate of 895,000-units.
