VOL. 9 | NO. 9 | Saturday, February 27, 2016
EMPHASIS Commercial Real Estate
Poplar Opens Up
By Madeline Faber
The prized retail stretch of Poplar Avenue between Perkins Road and Interstate 240 is shaking up in a way the area hasn’t seen in several decades. Within the next two years, more than 230,000 square feet will be made available in what has historically been a tight trade area.
That figure includes the three-story Sears, the Kroger store at Poplar and South Perkins Road and a significant holding in the Eastgate Shopping Center off White Station Road between Poplar and Park avenues.
Real estate along the highly coveted Poplar corridor from Laurelwood shopping center east to Interstate 240 is going to feature large vacancies that come along once in a decade at best, local retail brokers say. And retailers are salivating at the prospect. (Memphis News/Andrew J. Breig)
“Any time you get any availability on that stretch it's a big deal, and when you get that size, it's a once-in-a-decade or once in several decades opportunity,” said Aaron Petree, vice president of brokerage with Loeb Properties Inc., noting the large Sears space set to close in mid-April.
The 175,400-square-foot Sears was built back in the 1960s. Oak Court Mall, Laurelwood and other surrounding shopping centers developed around the department store and have brought the changing tide.
“What’s around it has become very high-end, very nice, so it makes sense that the Sears should be redeveloped into something nice as well,” said Danny Buring, partner with The Shopping Center Group.
Since Seritage Growth Partners announced the closing of the Sears at 4570 Poplar Ave., speculation has focused around a Nordstrom Rack taking over the space. Nothing is firm yet, but The Shopping Center Group has said that the property will be filled soon. Real Estate Investment Trust Seritage, Sears’ holding company, has also listed the 21,160-square-foot Sears Auto Center for lease with the ability to subdivide.
Just east of Sears is the 28,041-square-foot Kroger, which was part of Kroger’s 2011 takeover of Shnucks. With a Kroger renovation recently completed just a mile away at Poplar and Truse Parkway, Kroger is looking to let go of the store at 576 S. Perkins Road.
Buring told The Daily News that grocery store will close on May 30 and will likely be filled by a single tenant.
Further east on Poplar before Interstate 240 is Eastgate Shopping Center, which is anchored by Fresh Market, Stein Mart and Bed Bath & Beyond. While specifics aren’t available yet, Buring said a big-box tenant will be leaving within the next 12 to 18 months and its space will likely be taken over by a best-in-class retail tenant that’s new to the market.
“The Sears and Kroger at Poplar-Perkins are very iconic pieces of real estate, and I hope that they'll really be a game changer for retail in the area,” Buring said.
“You’re replacing a 50-year-old, three-level dinosaur of a department store. There are some retailers that are really going to be a huge draw. They're going to have a bigger attraction and bigger draw than someone that's got three to four stores in town or someone that's in all these areas,” he added.
Petree said Class A tenants want to be in the best part of town. In the past, that meant building ground-up in the suburbs. With an eye turning back to urban density, redevelopment is the only option to get sizeable property near busy arteries.
The last time Poplar Avenue land opened up en masse was 10 years ago when the Ridgeway Trace apartments were razed to make way for the Target-anchored Ridgeway Trace shopping center. According to owner Weingarten Realty, the area’s traffic count at Poplar and I-240 is around 210,000 vehicles per day.