Amid A Wave Of Store Closings, Cities Ask: What Can Be Done With An Empty K-Mart?

Apr 12, 2017

Credit Sarah Fentem / WBAA

Last week, electronics and appliance retailer HHGregg announced it was shutting down all its stores, including one in Lafayette. It’s one of several large retailers leaving the area, and experts say filling those spaces could be difficult in a rapidly-changing retail climate.

Greater Lafayette has been spared the worst of the closings, with its J.C. Penney, Sears, Gander Mountain and Macy’s locations remaining unscathed. But it could get worse—so far this year, nine retailers have filed for bankruptcy, the same amount as all of 2016. Analysts blame the rise in e-commerce and changing spending habits.

Lafayette’s K-Mart store was one of the unlucky locations shut down last winter. The location on State Road 38 remains vacant—along with half of the adjacent stores in the Lafayette Market Place Shopping Center.

Purdue Retail Sciences Professor Richard Feinberg says it’s unlikely the owners will find a similar big-box retailer to fill the space.

There’s nothing really there,” he says of the southern end of the strip mall. “It’s perfect for finding a developer that would make it something else. But it’s not just Lafayette or West Lafayette, this is a national phenomenon.”

Feinberg says thanks to changing consumer habits, such as the rise of digital commerce, the likelihood of filling many such spaces with similar retailers is slim. But he says that doesn’t mean the buildings can’t be redeveloped.

Part of what’s happening is natural evaluation of retailing,” he says. “If your timeframe is 50 years—mine isn’t, I’ll be dead! But something good will happen there. The question is: when?”

Kaid Benfield, an author who has written extensively about the evolution of urban spaces, calls vacant big-box stores a “very real problem with few answers in the real world.”

It’s  “especially a problem in suburbs where most (not all) of these big boxes are located,” Benfield says. “If the local economy is robust, some of the sites—if not the buildings—can be rebuilt with housing or walkable, mixed-use developments,” he says. “That’s happening all over the suburbs of DC where I live.  But smaller and less booming communities are going to have a hard time, I think. “

Lafayette Economic Development Director Dennis Carson insists other towns might have a problem filling shuttered retail centers, but Lafayette is lucky:

Bigger spaces are, of course, a little more difficult to fill because of the size, there's a limited number of businesses." (The term "big-box store" refers not to the goods sold, but the architectural space itself: it looks like a "big box.")

Continues Carson: “But since we have a growing community, we haven’t seemed to have a big problem with filling those larger spaces.”

Yes, he adds, people are buying more online, but online stores might eventually want to open physical locations, too.

“We are seeing stores that do a lot of primarily sales online starting new brick and mortar as well too. Amazon, which has been exclusively online for years, not here, but on the west coast, opened up their first brick-and-mortar bookstores.”

Carson points out what happens to the vacant spaces is up to private landlords—cities have little control over the properties unless they fall into disrepair.

Lafayette’s Gordman’s store was slated to close after the company filed for bankruptcy last month, but was spared after another company bought part of the retail chain.