Shopping Centers Today

DEC 2018

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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Page 21 of 99

22 S C T / D E C E M B E R 2 0 1 8 22 S C T / D E C E M B E R 2 0 1 8 A s Sears Holdings starts closing stores, many retail landlords are looking forward to shed- ding the decades-old Kmart and Sears lease rates they say have inhibited property performance. Over the years, the company's pres- tigious name helped secure•extended lease terms, which in some cases now include low-to-mid-single-digit rents, according to•Marcus & Millichap. Such landlords as•Kimco and Simon are predicting•higher lease rates as they bring in new tenants and rede- velop the recaptured spaces. A Marcus & Millichap•report says the abundance of space that could potentially come online may be advan- tageous to some markets. The Bay Area, Boston and New York City could all benefit from an increase of empty storefronts to accommodate growing chains there. Baltimore's relatively large Sears footprint of some 1.3 mil- lion square feet could help that market, because its retail vacancy rate is below 4 percent and developers are opening about 500,000 square feet of new retail space•annually, according to Marcus & Millichap. On the flip side, the firm says such metros as Chicago and California's Riverside–San Bernardino could be negatively affected by an avalanche of available space, given that•vacancy rates in those areas are expected to be at 6.2 percent and 8.7 percent, respectively, by year-end. Q The 10 markets with the most Sears stores New York City 23 25 5.96 million Los Angeles 18 7 3.46 million Philadelphia 9 11 2.24 million Washington, D.C. 11 7 2.38 million Chicago 9 8 2.16 million Riverside–San Bernardino, Calif. 9 8 2.16 million Miami-Dade 9 6 1.97 million Boston 7 5 1.56 million San Francisco–Oaklanbd, Calif. 6 5 1.41 million Dallas–-Fort Worth 9 0 1.40 million U.S. total 370 316 87.62 million Source: Marcus & Millichap SEARS KMART TOTAL STORES STORES SQ. FOOTAGE Markets with the largest Sears footprints T H E C O M M O N A R E A LE A S I N G

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