The big boxes gave, and the big boxes took away.
They took away a little more space than they gave back to the market for retail space here in the last half of last year, according to brokers for CB Richard Ellis-Oklahoma.
Five new leases for big stores were signed, and a library system bought one former store, absorbing a combined 141,800 square feet; but three stores closed, kicking a combined 121,058 square feet of space back onto the Oklahoma City area market, said brokers Mark Inman and Stuart Graham.
The upshot, in terms of available leasable retail space, is that the market tightened by 2 percent, or the equivalent of about one big store: 20,742 square feet, they said.
Graham and Inman have prepared six-month updates on big-box retail space since mid-2010, when the effect of the national recession was being felt with numerous closed national store chains.
Inman and Graham found 1,036,175 square feet vacant in 26 stores in their survey of spaces 18,000 square feet or larger. That was one fewer closed store but a decrease of 17 percent in total dark space since their first report, which counted 1,248,800 square feet.
“Interestingly, the deals done over the past six months are not isolated to a particular segment of the retail spectrum. The deals represent a range of rents and landlord contributions,” Graham and Inman reported. “Thrift stores made aggressive deals on long-held vacancies in Edmond and Yukon. On the higher end, Marshall's leased 25,000 square feet at one of the market's hottest retail corners, Memorial Road and Pennsylvania Avenue.”
Inman called the mix of deals “encouraging.”
“While headlines might be captured by the entry of national retailers like Sunflower and Marshall's, the absorption of space that might be considered more difficult is just as crucial for the overall health of the marketplace,” he said. “Deals for Class B space produce liquidity for landlords to improve their properties or seek additional investment in the market.”
Areas of opportunity
New vacancies include a 46,011-square-foot former Best Buy near Crossroads Mall, a 55,242-square-foot closed Homeland supermarket at Interstate 240 and S May Avenue and a 19,805-square-foot closed JoAnn's Fabrics at NW 63 and Northwest Expressway.
“The most challenging of the new vacancies may be perceived to be the large box abandoned by Best Buy on the periphery of Crossroads Mall. Fortunately, knowledge of the vacancy has been in the market for some time, and potential users have been identified,” the brokers wrote. “It is likely this location will be repositioned for nonretail use.”
One chain new to the metro-area leased two big-box spaces the second half of 2011: Sunflower Farmers Market, which opened last summer near NW 63 and May Avenue and soon will open near Second Street and Broadway in Edmond. Pioneer Library System bought a former Borders bookstore at Interstate 35 and Main Street in Norman.
Inman and Graham wrote that while national chains are expanding cautiously if at all amid lingering effects of the recession, Oklahoma City remains an oasis of opportunity. They said they expect six new retail projects to be built in the first half of this year. They won't immediately affect present inventory because they will be either new tenants entering the metro area or existing stores expanding their presence here.
“The benefit will come from the strengthening of certain retail corners and attention brought to the nearby vacancies,” they wrote.