Retail Inventory and Vacancy: Total retail space in Greater Hartford currently totals 37.6 million square feet, a nominal increase of 25,600 square feet from last year - in today’s environment, limiting new development should be regarded as means of stabilizing brick and mortar vacancy which has remained at frustratingly high levels for nearly a decade now.
Unfortunately, the region was unable to reduce vacant square footage during the past year, remaining virtually the same. While some retailers targeted Greater Hartford in their expansion plans in 2017, this growth was offset by a number of store closings, and bankruptcies in some cases, which resulted in the vacancy rate remaining unchanged at 11.1%. Although significantly below the peak level of 13.1% in 2013, shifting spending habits toward online purchases continue to impact retail real estate in Greater Hartford as it generally has across the U.S. As a result, net absorption in the region was nominally positive this year at 24,800 square feet.
Size Classifications: During 2017 changes in vacancy rates among size classification were mixed. First the good news: two size segments between 10,000 and 49,999 square feet showed significantly lowered vacancy rates, the latter (25,000-49,999) by 3.3 percentage points. The 2,500-4,999 SF vacancy rate also declined by 100 basis points. The bad news is that the 50,000-99,999 SF classification had a jump in the vacancy rate from 8.0% to 10.8%, impacted by two big box closings, Sears in Enfield and Bob’s Stores in Manchester. The other segment to experience a significant rise in the vacancy rate was the 5,000-9,999 SF classification, increasing 190 basis points. The remaining three size ranges experienced little to no change. Although Sears closed a store in the 100,000-199,999 SF bracket, the site was already earmarked for redevelopment and, as a result, Sears is not reflected as vacant space in the data.
Regarding vacancy, lowest rates were found in Newington and Rocky Hill, both under 4.0%. Farmington, Plainville, and West Hartford follow, respectively. Among towns with the highest vacancy rates, only East Windsor finished above the 20% level, coming in at 24.6%. The vacant Walmart and Showcase Cinema buildings are the biggest culprits impacting retail vacancy in this community. The top ten towns have vacancy rates of 10.0% and higher.
Retailer Activity: Key Bank led all retailers in square footage gain this year by acquiring First Niagara Bank. Included in the 300-branch acquisition were 20 locations in Greater Hartford, including 72,500 square feet. Jump Off Trampoline Park was a distant second with its second Connecticut location in Manchester, occupying a former Mill Store. Dollar General added three stores and 24,500 square feet. Key Bank is also the leader in added store count with its 20 branch locations. Metro PCS added 9 stores, continuing its steady expansion. Dollar General also ranks third in this category with three new stores.
Sears continued its downward spiral, contracting by 242,600 square feet with store closings in Enfield and West Hartford. While the Enfied store remains vacant, West Hartford is under redevelopment and will be called The Corbin Collection, which will include REI, Saks Off 5th, and Buy Buy Baby among others. The First Niagara Bank sale removes this namesake and its 72,500 square feet from the region. The closing of Bob’s Stores in Manchester ranks this retailer third in square footage decline. First Niagara also led the pack in store reduction with 20 locations. Radio Shack closed its remaining four units, placing it in a tie with Ruby Tuesday for second place.
Bob Sheehan, Vice President of Research
BSheehan@KeyPoint Partners.com
The KeyPoint Report examines the retail real estate marketplace for Greater Hartford, Connecticut, with a focus on changes between August 2016 and August 2017. 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. The complete report contains much more detailed information on these categories and more, and will be available soon at KeyPointpartners.com.
KeyPoint Partners’ GRIID™ database maintains detailed information on virtually all retail properties in three key regions: Eastern Massachusetts, Southern New Hampshire and Greater Hartford, Connecticut. These markets encompass approximately 44% of all retail space in New England. GRIID™ has information on nearly 262 million square feet of retail space and approximately 60,000 retail establishments. The KeyPoint Reports contain a summary and analysis of market trends and activity for each studied area.
The KeyPoint Report on Southern New Hampshire 2017 is available now, as is the KeyPoint Report on Eastern Massachusetts/Greater Boston 2017. The KeyPoint Report on Greater Hartford, CT 2017 will follow soon. Visit KeyPointPartners.com.
