Search sponsored by Coast Marketplace
Home Real Estate Real Estate Articles

Lots of uses for former Kmart stores, brokers say

Published on November 7, 2017 9:10AM

Last changed on November 7, 2017 2:01PM


While there is no word from owners regarding what is going to happen with the former Kmart store in Roseburg, there are plenty of potential uses for an empty big box store including new retail or even other sectors such as manufacturing.

The Kmart store on Northwest Stewart Parkway closed earlier this year, leaving an empty, retail building in what is a prime retail area for Roseburg thanks to the high levels of traffic moving past the store.

“That part of town is thriving,” said Jennifer Kramer, broker for Berkshire Hathaway Real Estate Professionals.

There is no word yet from the property owner, shown on county records as Invest West Alpha, of Santa Barbara, regarding what its plans are for the building. Invest West Alpha did not respond to phone calls and emails.

Kramer said a large building like the Kmart would be best marketed to another big-box retailer, though it could also be remodeled into smaller units.

One retail broker who has sold former Walmart buildings said big-box retail buildings have found new life as new stores or even manufacturing plants.

“We’re seeing some pretty good adaptive reuse,” said Alex Martinac, vice president and retail broker for CBRE, the commercial real estate and investment firm.

The potential uses range from revamping an existing building into smaller retail units, to tearing the building down and starting from scratch into a new retail center, to even remaking the building for use in other sectors such as manufacturing.

Martinac handled one deal where a former Walmart in Talent was turned into a manufacturing plant by a motorcycle company.

He noted that another, more retail-oriented possibility for a rural area like Roseburg would be a major outdoor sporting goods retailer such as Field and Stream.

While online sales may have to cut into big-box retail, some retail sectors that are lifestyle or experience-based, such as outdoor equipment retailers, are still going strong, and fears about online shopping displacing retailer are overblown, Martinac said.

“There’s certainly been disruption from the Internet. But a lot of categories are doing well,” Martinac said.

Proof of the momentum of some retail sectors was seen in Burlington, North Carolina, where a former Kmart was demolished within months after its closed in December 2016. It is being rebuilt as a new, 150,000 square foot retail center anchored by an Academy Sports + Outdoors store with a completion date in 2018.

One challenge specific to Roseburg could come from the lower sales of a rural area compared with a major metropolitan center. But Roseburg is in a good spot thanks to its wineries and its draw as a retirement community.

“It’s a very viable market, I think it’s got great potential,” Martinac said.

If the new use is retail, a large building may have to be sectioned into two or three smaller retail units in line with the trend toward 50,000- to 60,000-square-foot retail spaces, rather than the 120,000- to 150,000-square-foot space that a Walmart Supercenter might take up.

Martinac said the length of time that big-box stores stay empty varies. He has seen some developed quickly, and others sit vacant for a long time.



Marketplace

Share and Discuss

Guidelines

User Comments