In Greater Hartford, a return to stability may be in sight.
Vacancy: Total retail space in Greater Hartford totaled 37.1 million square feet at the end of the study, a small decrease from the 37.2 million square feet reported last year. Some spaces converted to non-retail uses or were demolished, contributing to the negligible decline in inventory. The most salient point regarding total inventory in the region is that there was virtually no net change.
New retail construction continued to move at a snail’s pace as most developers remained on the sidelines. Existing conditions in the market may be playing a large part in their decision. The better news is that following a few up-and-down years, the vacancy rate in Greater Hartford fell to 11.3%, its lowest level since 2009, a significant drop from the 12.0% vacancy rate in 2012. This equates to a reduction in the level of vacant space of 282,300 square feet. Still, occupancy levels need to improve substantially before we declare a healthy retail climate in the region.
Size Classifications: While vacancy showed improvement in 2013, it was not all good news. Only in the 50,000 square feet and higher categories do vacancy rates fall below double digits. Most troubling is the Under 2,500 square foot classification, in which vacancy inched up from 18.9% to 19.1% during the year.
Greater Hartford did show marked improvement in the store size ranges from 2,500 to 9,999 square feet, but trended higher in the 10,000-24,999 square foot range. Among the more prominent names closing stores in this size range were Rite Aid (2), Planet Fitness, Petco, Restoration Hardware, and Nike. In some cases, tenants relocated to smaller units.
|Greater Hartford, CT study area|
Among towns with the highest vacancy rates, East Hartford and Berlin again have the dubious honor of ranking firts and second, finishing at 23.8% and 23.1%, respectively. It’s disconcerting that both rates are somewhat higher than last year. New Britain and East Windsor also ended the year above 20%. Hartford ranked fifth at 16.3%, declining 220 basis points. Among towns with the lowest vacancy rate, Wethersfield leaped from fourth to first, coming in at 4.2% in 2013. The abutting town of Rocky Hill finished second at 5.3%, inching ahead of Enfield, which ended at 5.4%.
Retailer Activity: Walmart Neighborhood Market, with its first entry into Greater Hartford, a 59,700 square foot store in West Hartford, took the top spot for incremental space in the region. Kohl’s ended in second place with the addition of its new 58,966 square foot store in Berlin, its first smaller prototype in the region.
LA Fitness opened a 35,100 square foot health club in Farmington, good enough to rank third. Sleepy’s and Subway tied for the lead in the number of new stores in Greater Hartford with six apiece. Boost Mobile and Chipotle each added four stores. Gold’s Gym closed two Enfield locations, reducing its retail space by 37,200 square feet, the highest level in the region. TJ Maxx and Sears Hardware were the only other retailers to decline by more than 25,000 square feet. Better Bedding exited the region by vacating four stores which were acquired by Sleepy’s. Midas Muffler and Liberty Tax Service each closed three stores while several retailers closed two units.
The full report contains much more detailed information on these categories and more. Stay tuned!
Bob Sheehan, Vice President of Research
The KeyPoint Report examines the retail real estate marketplace for Greater Hartford, Connecticut, with a focus on changes between June 1, 2012 and July 31, 2013, a 14-month span. This report provides an analysis of changes in the region's retail activity and examines supply, vacancy and absorption, retailer activity, and market composition by store size and retail categories. The Greater Hartford market includes 26 cities and towns and represents more than 835 square miles and approximately 812,200 persons, equating to 22.6% of the Connecticut total population. The KeyPoint Report for Eastern Massachusetts/Greater Boston and TheKeyPoint Report for Southern New Hampshire have been released, and are available at KeyPointPartners.com.