File photo of the former Clovis Costco location from 2018

published on May 3, 2018 - 2:17 PM
Written by David Castellon

A few decades ago, Valley residents longed for big box stores so they wouldn’t have to drive long distances to larger cities to shop for wide varieties of goods in one place.

Today, big box stores from Macy’s to Best Buy dot the Valley’s retail landscape, but with so many ways to shop these days — from being able to digitally try on and buy clothes to having shopping done for you, so all you have to do is pick up your purchases — so-called “brick-and-mortar” stores, particularly big box stores, seem likely to undergo some big changes.

Those big changes could involve getting smaller, said Rachel Orlando, a sales associate at Retail California in Fresno, which specializes in selling and leasing retail spaces.

“Big chains are going to downsize,” she said, noting the example of Kohl’s department stores, which are downsizing a “significant” number of stores.

Kohl’s is in the midst of a strategy to reduce the sizes of most of its more than 1,100 stores across the country in order to avoid store additional closures due to declining sales, as stores ranging from Sears to Toys R Us have done.

“Stores don’t need 80,000 square feet anymore,” said Orlando, echoing comments she made recently as one of six Valley real estate experts who spoke at the Fresno Economic Development Corporation’s 2018 Real Estate Forecast.

She said big box stores are looking at ways to exist in smaller retail spaces, about the sizes of those used by Burlington and Ross department stores.

Kohl’s already has made hundreds of its stores “operationally smaller” — some as small as 35,000 square feet compared to the more common 80,000-plus-square-foot models — generally by walling off unneeded space or moving to smaller buildings, according to news reports.

Kohl’s officials couldn’t immediately be reached to discuss what downsizing plans they may have for their stores in the Valley.

In conjunction with downsizing, Kohl’s is pushing its online sales, which has included having kiosks available in stores where customers can order goods not on the shelves and racks.

As this trend takes hold, it’s likely some big box stores here may become vacant, Orlando said.

“The biggest challenge will be what to do with empty boxes in undesirable locations,” said Orlando, citing the potential problems of filling the current Clovis Costco southeast of Ashlan and Peach avenues once its vacated after a new Costco is built across town, off Clovis and Shaw avenues, the city’s main retail drag.

Then there’s the case of the former Forever 21 store at the Hanford Mall, vacant since April 2016. While efforts are underway to erect an indoor trampoline park there, the new business would occupy only about 35,000 of the 85,000 available square feet.

“There is no blanket method on what to do,” Orlando said, noting that dividing big retail spaces into smaller ones could help in drawing tenants who don’t need all that space, but splitting a building can be costly — too costly for some property owners, unless they can line up “quality” tenants with good credit and potential staying power.

As such, Orlando said, property owners and brokers likely will have to work harder to fill big, empty retail spaces.

“Quality tenants are going to be harder to find,” she added, noting that fewer new retail concepts are emerging that might bring new types of businesses, though some existing businesses are looking to enhance the “cherish” aspects of retail.

“Cherish retail is the part that involves discovering great deals and socializing with others and finding experiences you can’t get anywhere else,” Orlando said.

Among the examples she cited is Starbucks opening “coffee bar” stores with more seating, decor and lounge-like atmospheres that encourage drinkers of coffee — or whatever other beverage they prefer — to sit down and relax rather than opting to grab a cup and go.

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