The latest liquidation casualty is Toys R Us. Along with Babies R Us stores, this chain vacated 30 stores and more than 1.0 million square feet of retail space across the three regions covered by KeyPoint Partners’ proprietary GRIID: Eastern Massachusetts/Greater Boston, Southern New Hampshire, and Greater Hartford.
Needless to say, this was a severe blow to the entire toy industry. Some of the retailers who have already benefited from the fallout should be obvious: Walmart, Target, and Amazon picked up much of the business. But others such as Michael’s, Costco, Party City, Kohl’s, JCPenney and Five Below are also taking advantage of the toy expenditures that became available following the liquidation. The result, as reported by NPD Group, was that toy manufacturers experienced a drop in revenue of only 3.4% since that time. However, while the toy industry may have survived the fallout, Toys R Us landlords are again left scrambling to fill the space. So how are they doing so far?
Property owners have found replacements for 13 of the 30 vacancies to date. The first replacement stores to open back in August were Pottery Barn Warehouse Outlet at Northborough Crossing in Northborough, which filled the Toys R Us box, and Raymour & Flanigan at Shoppes at Blackstone Valley in Millbury, taking the former Babies R Us.
Two retailers have acquired multiple units left behind by Toys R Us. PGA Tour Superstore opened its first Boston area store in February in the vacant Toys R Us store at Northshore Mall in Peabody, MA and also acquired the Babies R Us store in Braintree at the Marketplace at Braintree, MA, scheduled to open in June. Ocean State Job Lot acquired three former Toys R Us stores, the first of which opened this month in the Salem, NH store. Another April opening is scheduled for later this month at the former Toys R Us in Campanelli Park in Brockton, immediately north of Westgate Mall. The third unit should open later this year at Town Center West in North Dartmouth.
Gardner Outlet Furniture, which operates its original store in Gardner, added a second location in March, taking the former Toys R Us unit at The Mall at Whitney Field in Leominster, MA. Woburn, MA recently approved permits to allow Launch Trampoline Park to move into the Toys R Us unit at Horn Pond Plaza where Whole Foods is an anchor. Woburn will be the fifth location in Massachusetts for Launch, expected to open later this year. Similarly, Edge Fitness will occupy the Toys R Us space in West Hartford, CT at Corbin’s Corner by year-end. Sullivan Brothers Toyota Nissan acquired the Toys R Us store in Kingston, MA, located opposite its existing location which it plans to expand. At this time, the only other Toys R Us store that appears to have found a replacement is the Dedham Mall unit in Dedham, MA. Although there is no tenant announced, Wilder is indicating that a deal is pending for the store, located adjacent to the new At Home store, which recently filled a portion of the vacant Sears.
This leaves 17 Toys R Us boxes still vacant, although among those are many quality locations which should find prospects soon enough. Some of the stronger shopping center locations include Shoppers World in Framingham, where both Toys and Babies remain idle; Gateway Center in Everett; The Manchester Collection and Plaza at Buckland Hills, both in Manchester, CT; Webster Square and Nashua Mall, both in Nashua, NH, and others. We’ll be tracking these vacancies and will let you know about them in our upcoming 2019 KeyPoint Reports, which should be rolling out over the summer months.
Bob Sheehan, VP of Research,