Business Buzz
By Rich Baehrle
We are witnessing a substantial shift in the retail industry from bricks and mortar to online retail, leaving behind vacant stores.
It has become too convenient for the consumer to buy virtually any item online. However, this comes with a price, a big price with store closings and job losses on the local level. It is a zero-sum game. For every winner there will be a loser.
Personally I try to shop local the best I can knowing this will support our neighbors and businesses.
I recently visited the Hamilton Mall. It was sad to see all of the iconic stores that have vacated the mall including Sears and JC Penney, which combined to occupy more than 300,000 square feet. I counted more tha 20 vacant stores.
I spoke with some of the merchants and they indicated that there simply are too few shoppers. It is virtually a ghost town some days.
The Hamilton Mall is not the only center experiencing this shift. It is occurring throughout the country with enclosed malls. However, many retail malls are reinventing themselves by repositioning into many different entities such as office, residential and creative recreation components. Mall owners can’t afford to just sit back and pray for retail. It will most likely not happen. It’s time to get creative.
I also traveled over to Hamilton Commons. While they have not experienced the same percentage of vacancy as the Hamilton Mall, they are feeling the pain as well.
I counted seven vacant stores with such names as Famous Footwear, Lane Bryant, Famous Dave’s, Cacique and the latest Bed Bath and Beyond. This retail center should consider diversification as well.
Sometimes the difficulty the owners experience is that there are restrictive covenants prohibiting the owners to lease to nontraditional businesses. Some centers are entertaining cannabis businesses, but many of them have an issue where they cannot lease to cannabis businesses due to federal regulations associated with financing.
One retail center that seems to be doing well is English Creek. They seem to have found success by integrating non-retail businesses such as Shore Beauty School, Southern Jersey Family Medical, Luxuria Day Spa and other office uses. It seems to be working well as they have very little vacancy. The combination provides a nice synergy.
The bottom line is the owners of these properties need to get creative and start thinking outside the box. Also we, the consumers, need to do our part and get off line and support our local businesses.
If we don’t, stores will continue to go out of business and the value of the properties will diminish, which will ultimately result in tax appeals. Eventually it will mean residents will pay more in property taxes.
Time to stop, shop, play and stay in Atlantic County.
Rich Baehrle, of Berkshire Hathaway Fox and Roach, can be reached at 609-266-6680 or 609-641-0011. Email richardbaehrle@gmail.com or see www.getrichinrealestateSJ.com
