What will happen to the hundreds of shuttered Kmart and Sears locations around the country? The retail locations formally occupied by these tenants will be repurposed or redeveloped to meet current market demands, with the exact use or concept to be dictated by the individual trade areas of which these locations lay. Most of these former Sears and Kmart boxes are old and functionally obsolete, ranging between 100,000 – 200,000 SF and in many instances includes a 2-story structure. The physical composition of these old retail footprints makes it very difficult to retrofit the existing to meet the format of successful retail in today’s current environment. In many instances, landlords are thrilled to recapture their space from these tenants. Most of these leases are old with rates that are artificially low, below the standards of today’s market. This presents landlords with an opportunity to add value their real estate, secure new users at market rental rates, create new synergy within their tenant mix to draw more traffic, ultimately better utilizing their properties.
Real Estate formally occupied by Sears and Kmart is in high demand. Landlords are excited to recapture their space back from these tenants and have an opportunity to redevelop or repurpose their assets. It presents landlords with a chance to create value and bring their rents up to market with new and exciting uses for these locations. Fitness concepts are a hot target for landlords with these vacant retail boxes. With health in such high demand, fitness uses are mainly internet resistant and create large amounts of foot traffic which stimulates surrounding retail at these properties. Value Retailers, Restaurants, Grocers, and Medical Users are all considering the closed stores as well as Entertainment Concepts and Movie Theater chains. It will be exciting to see what landlords choose to do with these spaces. Each property and market will be different, and landlords are essentially being given back their brush with an opportunity to paint on a blank canvas.