Big boxes are crumbling around us

[TulsaGoldenHurriCAN]

I think the statements that big box retail is dying or collapsing are overstated (the large department store model may very well be on the way out).  The real issue is there is simply way too much retail space.  Not only are online sales eating into brick and mortar businesses, but there has been way too much brick and mortar built over the last decade.

I agree that big box retail is not completely dying or collapsing so quickly, but we are talking long-term changes here. Just like when people talk about what will all of the Semi-Truck drivers and cab drivers do when driverless cars replace them. In-store retail is on the decline and within the next couple years in-store retail will be at least a 10% down from it's peak. Not catastrophic, but that represents billions in dollars of sales that won't be there for brick and mortars and who knows what the ceiling is for online sales? I could see that reaching 30% eventually.

Think of the major retail areas that have sprung up in Tulsa in the last decade: Owasso along 169, Broken Arrow east of Bass Pro, Memorial from South Tulsa into Bixby, and Tulsa Hills/Walk.   A decade ago, big box retail in those locations simply did not exist and folks in those areas traveled to Woodland Hills/71s & Memorial, 41st & Yale and 21st & Yale to do a much of their shopping.  Now, each of those areas essentially has all the same types of stores/restaurants and everyone stays closer to home.  In that same decade, Tulsa area's population growth hasn't come close to matching the growth in retail square footage. 

Did those areas really create much new retail sales growth or did they simply siphon it from other areas? I see a lot of empty storefronts in strip malls all over Broken Arrow and these places probably added to the decline of Promenade and hurt other new places like Midtown Village off I44 which has only Bed Bath & Beyond. I think it is a combo of too much new retail square footage (perhaps the larger issue to date?) and declining demand due to online sales.

It seems like the model for retail is to build new to create a new posh shopping center by the highway that is nicer than other shopping centers so people will want to flock to it instead, usually with a popular chain anchor tenant new to the area such as REI/Bass Pro/etc. These new places create a buzz for a while and the area may thrive for a decade or two with high rents until it turns into just another retail area and dies off as it deteriorates. All the while, all of the dozens of other retail strips suffer with declining rents, declining buildings and declining customers and many parts of town end up looking like post-apocalyptic strip mall grave yards (See: East Tulsa, Admiral blvd).

[johrasephoenix]

Also, a lot of shopping center developers are "merchant builders."  They build the same thing over and over again in different markets, in this case big box shopping centers, usually with cities leaping to provide public infrastructure for extra sales tax revenue.  

That model generally requires a pre-packaged plan they can slap down on a greenfield site with a few minor adjustments.  It's Model T Ford style development.  It doesn't fit well with buying an existing shopping center and rehabbing it, or dealing with a pre-existing urban neighborhood.

So development keeps sprawling south because that is where the greenfield sites are.    

I'm also going to take a wild guess that a lot of the semi-abandoned shopping centers in Tulsa like 41st & Yale have environmental issues that cookie cutter developers don't want to deal with.  That much parking with that much vehicle run off for that many years is likely to have caused some problems.

@Artist - I agree that downtown needs a marquee retail street - Michigan Avenue in Chicago, Newbury Street in Boston, King Street in Charleston.  I think Tulsa's issue is that its best, most intact streetwall - Boston Avenue - is also its most intense office/commercial street.  A lot of those storefronts will have highest and best uses that target office workers instead of shoppers/visitors.  In those other cities I mentioned, the premier retail street is always near the CBD/Financial District but never actually in it.  But in any case you're right - retail/entertainment has to be tightly clustered if it is going to become more than the sum of its parts.    And I still hope it becomes Boston Avenue because that's my favorite street in all of Oklahoma.  

[TulsaGoldenHurriCAN]

Also, a lot of shopping center developers are "merchant builders."  They build the same thing over and over again in different markets, in this case big box shopping centers, usually with cities leaping to provide public infrastructure for extra sales tax revenue.  

That model generally requires a pre-packaged plan they can slap down on a greenfield site with a few minor adjustments.  It's Model T Ford style development.  It doesn't fit well with buying an existing shopping center and rehabbing it, or dealing with a pre-existing urban neighborhood.

So development keeps sprawling south because that is where the greenfield sites are.    

Yeah, that is what I call "Copy & Paste America" and has done a great job making countless communities look like anywhere else. They package the same 4-8 big-chain tenants and get them to agree to place locations in X number of places. They build there and are able to undercut locals on rent thanks to the tax abatements or kickbacks from the city (and location, thanks to charitable city counsels!) and the chains are able to undercut local places (volume, nice/new store thanks to funding, etc).

These places feel so generic as do the establishments that typically fill them which are often devoid of local flavor or personal touch. Many Americans love that sort of stuff like what they did in Owasso. Sure it looks nicer than the alternative (deteriorating strips), but shuts all the little guys out of business in favor of huge corporations. Is this a good sustainable future which will be fruitful to continue to invest in? Is this the sort of society we want? Too late to ask that. It is what we have.

[TulsaGoldenHurriCAN]

@Artist - I agree that downtown needs a marquee retail street - Michigan Avenue in Chicago, Newbury Street in Boston, King Street in Charleston.  I think Tulsa's issue is that its best, most intact streetwall - Boston Avenue - is also its most intense office/commercial street.  A lot of those storefronts will have highest and best uses that target office workers instead of shoppers/visitors.  In those other cities I mentioned, the premier retail street is always near the CBD/Financial District but never actually in it.  But in any case you're right - retail/entertainment has to be tightly clustered if it is going to become more than the sum of its parts.    And I still hope it becomes Boston Avenue because that's my favorite street in all of Oklahoma.  

That would be great if Boston could develop into that. I think perceived parking (and inability to park hundreds of cars easily) has kept big retail out of that strip and made retail demand there slow. So many shops have opened and closed in that area.

Maybe the Block surrounding Santa Fe Square will have to be the marquee retail street. The Boxyard gives a good start to building a retail area along with the main Blue Dome (Detroit-Elgin-1st-2nd) block as another bookend. That area has some of the biggest hustle and bustle downtown and is set to really pick up with the PAC lot and Santa Fe projects. It could end up being the best little urban district in Oklahoma and be enough of an experience to pull in the kinds of crowds that keep retail feasible. There are so many events throughout the year that could boost foot traffic and sales (St Patrick's Day, Blue Dome Arts Festival, Tulsa Tough).

[Cats Cats Cats]

With the tepid population growth in Tulsa (if there even is any growth) the new shopping centers and such that we have are basically just thinning out the customer base or drawing it to a new area leaving the older areas to suffer.  Add to that internet purchasing eating up a percentage. 

With all the restaurants opening it is the same thing.  There aren't a lot more people showing up they are just going different places. 

[saintnicster]

JC Penney in Tulsa spared for now

Tulsa World

Department store chain J.C. Penney announced the 138 stores it's closing Friday morning, and Tulsa was spared the loss of another department store.

Ponca City, Claremore and Stillwater weren't, however, as the retailer pulled back from some smaller Oklahoma markets. The company is also closing a location in Altus.

The nationwide closures will impact about 5,000 employees nationwide, the company said.

JC Penney said most of the stores will begin the liquidation process April 17.

The pull-back from JC Penney is mostly in smaller markets, which is a departure from the long-time strategy of the department store. The brand, like Sears, was known for being in small cities across the U.S.

[BKDotCom]

Looks like pending doom for Woodland Hills' Sears  (all remaining sears' actually)

http://www.newson6.com/story/34979739/sears-may-shut-its-doors

[Tulsasaurus Rex]

http://www.fox23.com/news/tulsa-neighbors-near-51st-and-harvard-concerned-by-closing-businesses/499493308

Lots of big box failure at 51st & Harvard. That whole area needs to be bought up and redone in one big mega-project.

[BKDotCom]

http://www.fox23.com/news/tulsa-neighbors-near-51st-and-harvard-concerned-by-closing-businesses/499493308

Lots of big box failure at 51st & Harvard. That whole area needs to be bought up and redone in one big mega-project.

If "lots" = K-mart and Reasors
"Country Club Plaza" (the strip where Reasors is) could use an update...   Perhaps an REI.  right off of the interstate....
Hobby Lobby and Mardel is an improvement to the former K-mart location.

Perhaps a grocery store would do better in the old Hobby Lobby spot.

mega-projects tend to produce cookie cutter strip malls with generic big-box.

[PonderInc]

Legalize pot, and all these places would become greenhouses. 

http://www.denverpost.com/2014/03/10/pot-growing-warehouses-in-short-supply-as-demand-for-legal-weed-surges/
http://www.denverpost.com/2015/10/19/marijuana-industry-drives-denver-metro-areas-real-estate-recovery/

[Bones013]

Construction dumpsters and contractor sign at the former Mardel's on Harvard.

[Tulsasaurus Rex]

Construction dumpsters and contractor sign at the former Mardel's on Harvard.

Anyone know what's going in there?

[heironymouspasparagus]

Looks like pending doom for Woodland Hills' Sears  (all remaining sears' actually)

http://www.newson6.com/story/34979739/sears-may-shut-its-doors

They have been walking dead for years...that is the price for going the Harvard School of Business MBA route...  You cannot "cut cost" your way out of a bad situation as the sole solution.

[Bones013]

Anyone know what's going in there?

Joel Coggins is the contractor. His Facebook photo album has a lot of pics of Rustic Cuff build-outs. Coincidentally, happens to be the same building that Rustic Cuff used for a pop up  shop on Black Friday last year.  But, who knows? 

[BKDotCom]

But, who knows? 

Here's hoping
https://www.youtube.com/watch?v=4BUDwj_mXKE