Area Sees 2.9-MSF Growth in Retail Supply

GREATER BOSTON-Retail supply in this area has increased by 2.9 million sf to over 164 million sf, according to a report released by Finard & Company LLC, a Burlington, Massachusetts-based commercial real estate firm. The report, which covers the changes from the third quarter of 2000 to the third quarter of 2001, indicates that the increase in retail supply here is driven mainly by the expansion of a number of dominant retailers in the market including Wal-Mart, Target, Home Depot and Lowe’s.

The report also notes that the vacancy for retail space has increased by two million sf with the vacancy rate rising from 7.3% last year to 8.3% this year. According to William Beckeman, a partner at Finard & Company, the increase is not drastic. “Its what you would expect,” he tells GlobeSt.com. “An influx of retailers cushioned the blow” of those who left.

Beckeman points out that Bradlees, the discount retail chain that went under last year, can account for nearly all the increase in the vacancy rate. Nearly all the Bradlees leases are being taken over by Kohl’s. But there are potential closures down the road with Kmart, Ames and Service Merchandise all faltering. “We expect Kmart and Ames to close some stores but it’s unclear how many,” says Beckeman. But he adds that if Ames or Kmart survive as ongoing entities its unlikely that the area will see much liquidation.