Once an agreement is finalized, it usually takes 18 to 24 months for the new retailer to open. The company has previously opened gyms at former stores of two brands that filed for bankruptcy: Toys ‘R’ Us and Sears.Ī real estate investment trust that owns nine Bed Bath & Beyond stores, Federal Realty, is currently talking to chains like TJX, Burlington, Ross, Nordstrom Rack, Container Store and others about moving into Bed Bath & Beyond spaces.
“Bed Bath and Beyond sites are interesting to us, and we are exploring available opportunities with our franchisees,” a spokesperson told CNN. Chip Somodevilla/Getty Imagesīut it’s not only retailers looking for space and enjoying growth.ĭiscount gym Planet Fitness is opening about 200 new gyms a year. TJ Maxx and other discount chains are growing. In fact, despite high inflation and a pullback in retail sales, physical store openings exceeded closings last year for the first time since 2016, according to Coresight Research.Īnd so far store opening announcements have outpaced store closures this year, the firm says, with Dollar General, Family Dollar, Dollar Tree and Five Below at the top. Other companies are using their stores to ship online orders to customers, which can be more efficient than delivering orders from warehouses. Growth has been most pronounced in the discount segment of retail as shoppers on tight budgets search for low prices. In some cases, landlords are also eager to replace old Bed Bath & Beyond leases because the company was paying below-market rent in certain locations, Telsey Advisory Group analysts said.īed Bath & Beyond has fallen to the “retail apocalypse” over the past decade, but many chains are still growing. “There is good interest for Bed Bath & Beyond stores that are closing given desirable locations” and an average size of around 30,000 square feet, retail analysts from Telsey Advisory Group said in a note to clients.
The company's store closings will create opportunities for other chains to replace Bed Bath & Beyond. Plus, the majority of its stores are in the suburbs of mid-size and large cities and are under 50,000 square feet, all of which are attractive qualities in retail as brands trend toward smaller spaces to save on rent, labor and other overhead.Ī closed Bed Bath & Beyond store this year in Larkspur, California. The company has stores in all 50 states, with the most in population-dense areas in California, Texas, New Jersey and Florida. So Bed Bath & Beyond has a lot to offer prospective tenants. Store space is incredibly scarce at the moment, and that’s an ongoing trend: Total new commercial retail real estate construction reached a new low in 2022 for the third consecutive year, according to CBRE.Īnd for existing spaces, the retail space vacancy rate fell to 4.9% at the end of 2022 - the lowest level since CBRE began tracking the market in 2005. “So many of our most productive locations were formerly Circuit City or Toys ‘R’ Us or Sports Authority.”Ĭommercial construction and vacancies at record lows “For us, the biggest source of new store locations comes from other retailers closing stores,” Burlington CEO Michael O’Sullivan said on an analyst call in February. Particularly in a tight commercial real estate market, bad news for one brand means opportunity for another.
It will not take long for retailers to occupy those spaces.” “A lot of great real estate is going to come available into a market where there’s been no vacancies. “E-commerce scared a lot of people off from building retail,” said Brandon Isner, the head of retail research at CBRE, a commercial real estate firm. Anthony Behar/Sipa USA/APīed Bath & Beyond was a retail pioneer. People walk past the entrance to a Bed Bath & Beyond retail store along Sixth Avenue in New York, NY, September 4, 2022.
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