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April 28, 2023 : Bed Bath & Beyond, which filed for bankruptcy on Sunday, has nearly 500 locations that could become available for other retailers to rent, with its stores closing in high-traffic suburban areas. Given the convenience and proximity to growing communities, these retail spaces could be attractive to doctor’s offices, grocery stores, off-price retailers, and hybrid store gyms. With vacancy rates for shopping centres falling to 5.6%, off-mall spaces have become a hot commodity, and the demand for physical spaces continues to grow. Retail real estate had a banner year in 2022 in the US, with Coresight Research finding that major retailers opened roughly 2,500 new stores.
The surge in demand is driven by several factors, including the growth of off-price players, such as Dollar General, and retailers adding technology to better understand customer behaviour. Kimco Realty, a real estate investment trust with 27 Bed Bath stores in its portfolio, has confirmed that it already has tenants lined up to fill most of these locations, including off-price, full-price, entertainment, grocery, furniture, and automotive or appliance stores. Retail industry watchers expect retailers to continue expanding at a similar pace this year, even as interest rates rise and the economy gets choppier.
