Retailers are on track to open more stores than they have since 2018

Chains like Dick’s Sporting Goods, Five Below, Sephora, T.J.Maxx and Ulta Beauty are growing their store portfolios, fueled by strong cash reserves, prime available spaces and flexible lease terms. As many retailers’ online sales have surged, more stores are needed to provide omnichannel service, said Dick’s president and CEO Lauren Hobart. “Stores are the hub of our omnichannel experience, providing over 800 forward points of distribution for digital fulfillment. In fact, during the fourth quarter, our stores enabled 90 percent of our total sales and fulfilled over 70 percent of our online sales, either through ship-from-store, in-store pickup or curbside.” Dick’s plans to open 12 stores this year.

So far in 2021, U.S. retailers have announced 3,199 store openings and 2,548 closures, according to Coresight Research. The firm tracked slightly more store openings last year, 3,298, but a lot more closures, 8,953. 2021 openings are already on pace with 2018 and 2019, according to Coresight. Retailers opened 3,747 stores in 2018 and 4,548 in 2019.

5 retailer updates

Fabletics will open 24 stores — in Alabama, Arizona, California, Iowa, Kansas, Maryland, Massachusetts, Michigan, North Carolina, Oregon and Texas — in 2021, bringing its footprint to 74 locations. “Our members have missed the in-store experience, and we’ve found they are eager to return,” said co-founder and CEO Adam Goldenberg. “Personalized experiences that make in-store worth the visit are more important than ever.” The new stores will include fitness boutiques in which trained sales associates will demonstrate at-home rowing machine equipment from Hydrow. The expansion kicked off this month with a relocation and redesign within Mall of America.

Teen-focused discount chain Five Below, which added permanent Five Beyond sections to 140 stores in 2020, plans to double that number this year. Five Beyond features more-expensive merchandise that broadens the retailer’s customer base. The store-within-a-store concept will be in 30 percent of the Five Below fleet by the end of 2021, according to president and CEO Joel Anderson.

Military-themed apparel retailer Grunt Style is opening two stores this month, one in its hometown of San Antonio and the other in Carol Stream, Illinois. The company plans to open more stores on and near military bases nationwide.

Brand management firm WHP Global has purchased a controlling interest in Tru Kids Brands, owner of Toys R Us and Babies R Us. WHP says it eventually could open physical stores under each brand.

Dollar General forecasts its same-store sales will contract by between 4 and 6 percent 2021 after climbing 16.3 percent in 2020. From Feb. 27 through March 16, its same-store sales decreased 16 percent year over year. Dollar General plans to open 1,050 stores this year, about the same number as in 2020.

Simon seeks investors abroad

Simon is raising money from international investors who believe in the future of the U.S. mall business. The REIT plans to raise $894.6 million selling unsecured notes, due in 2033, on the Luxembourg Stock Exchange. The offering is expected to close on March 19. Simon will use the funds to pay off debt.

New fund for necessity-based shopping centers

Developer Greenberg Gibbons raised $100 million in private equity for a fund to buy properties with value-add potential in East Coast, Southeast and selected Midwest markets. Investors include high-net-worth individuals, family offices, institutional investors and Greenburg Gibbons itself. According to CEO Brian Gibbons, plans for the fund have been in the works for more than a year but accelerated due to the pandemic. “Due to operational and investment challenges affecting retail shopping centers caused by COVID-19 and other e-commerce trends, we saw a rare opportunity to leverage our team’s expertise by acquiring necessity-based shopping centers well below replacement cost and at significant discounts to historical valuations.”

This time last year

These were the stories dominating headlines 12 months ago this week.

COVID-19: Where the retail real estate industry is headed
Recession and recovery: The shape of the economy through 2020
ICSC asks members to help lobby Washington for industry aid
ICSC chief takes to national media to urge federal support for retail real estate
Trump signs historic $2 trillion CARES Act into law
U.S. retail sales rose year-over-year in February
Who’s building what, where

The latest retail property deals

ElmTree Funds acquired four parcels of land comprising Knoxville, Tennessee’s former East Towne Mall from Millertown Pavilion LLC for $221 million. The deal makes way for an Amazon last-mile delivery fulfillment center that will open in 2022.

Medipower Public Co. will buy six Philadelphia-area grocery-anchored shopping centers totaling 741,902 square feet from Brandolini Cos. for $115 million. The properties are Lionville Shopping Center, Hamilton Square Shopping Center, Spring Towne Shopping Center, Dreshertown Plaza, Marketplace at Westown and Limerick Crossing. The grocery anchors are Giant, Acme, Aldi and George’s.

Buchanan Street Partners bought Fountain Valley, California’s E405 Euclid Shops, a 91,517-square-foot flex/showroom retail center, from a Southern California-based family trust for $24 million. Tenants include furniture retailer Cort, Guitar Center and Sherwin-Williams. SRS National Net Lease Group represented the buyer and the seller.

RELATED: Brands restart showroom engines

The 66,000-square-foot Central Plaza Shopping Center in Lake Elsinore, California, traded for $22.6 million. Faris Lee Investments sold seven pieces to seven buyers. Marshalls, Five Below and Skechers each are single-tenant, net leased buildings. Panera and Miguel’s Jr. each are single-tenant, net leased buildings with drive-thrus. The other two assets are an Ulta Beauty and a two-tenant pad occupied by Pieology Pizzeria and Ono Hawaiian BBQ.

Colony West Group LLC and C-Lef Partners LLC sold the 87,000-square-foot Colony West Shopping Center in Little Rock, Arkansas, to Midland Atlantic Properties for $8.5 million. Tenants include Kroger, Simmons Bank, Senor Tequila and bike store Trek.

Jackson Investment Group and McCormack Development sold two multitenant retail properties in Fort Wayne, Indiana, for a combined $11.8 million to a private investor based in Mexico City. The 14,271-square-foot Shops at 407 is occupied by 5-Star Nutrition, CoreLife Eatery, Comcast, Mission BBQ and Wingstop. Tenants at the 12,939-square-foot Corner Shoppes include Blaze Pizza, Red Wing Shoes, iCryo Recovery & Wellness, T-Mobile and Stanton Optical. Hanley Investment Group represented the seller, and Quantum Real Estate Advisors represented the buyer.

The Kent Mall LLC purchased Rustburg Marketplace — a 46,700-square-foot, Food Lion-anchored shopping center in Campbell County, Virginia — from Rustburg Ventures LLC for $4.7 million. Tenants include Family Dollar, Virginia ABC, Domino’s and Subway.

Mount Pleasant, South Carolina’s Shops at Gregorie Ferry Landing — an 11,125-square-foot property occupied by Panera, TD Bank and Heartland Dental — sold for $7.4 million in a 1031 exchange. SRS Real Estate Partners represented the buyer, and Oswald Cooke & Associates represented the seller. All three tenants have signed long-term, triple-net leases.