The Magic Valley Mall is welcoming national retailer Kohl’s. The department store will be taking over the 68,700 square foot space that previously housed Sears. The parking lot and interior of the space are currently under construction. With Shopko’s recent closure, Kohl’s announcement signals a bright future for the mall and is expected to attract more shoppers.
Unsurprisingly, 2019 Retail net absorption has been heavily impacted by the three Shopko (285,400 SF total) and one Sears (120,800 SF) store closures. These combined closures have put the Retail market on pace for its lowest absorption since 2009 and net absorption could remain negative throughout 2019 unless some of these recent big-box vacancies are able to backfill. Additional big-box closures have not been announced, so total vacancy will likely remain steady throughout the remainder of the year.
"New data shows that more retailers are opening more stores than are closing them." ICSC just released a report by the IHL Group, that reviewed 1,660 national retail chains and that finds "roughly five retail chains are opening stores for every single retailer that is closing them this year... The firm also reports that the number of chains adding stores in 2019 has increased by 56 percent, while the number of chains closing them has decreased by 66 percent."
Don Day at BoiseDEV recently authored a significant "deep dive" article exploring Boise's options to best optimize future growth, titled "Where will Boise grow? Ownership, geography, affordability drive future plans."
The piece offers thoughtful insight into a myriad of considerations that impact Boise's present and future development. Interesting points made by the article include:
In an effort to evaluate the labor-market and general economic health for all the states and the District of Columbia, the Business Insider recently analyzed states' unemployment rate, job growth, per-capita GDP, GDP growth, average weekly wages, and wage growth.
The Shopko on 17th Street in Idaho Falls officially closed its doors last month. The former big-box retailer vacated over 90,000 square feet, driving up overall retail vacancy to 8.76%, the highest it’s been in 12 months.
Retail construction in the Treasure Valley has been minimal this year with the only active sector being single-tenant pad buildings. As construction costs continue to increase, many developers have found that single-tenant buildings (with a tenant in-tow) present far less risks than spec construction.
New single-tenant pads include O’Reilly off of Idaho Center Blvd., Del Taco in Caldwell, and PIVOT Lifestyle + Fitness Center at Ten Mile Crossing.
Idaho Falls brokerage services specialist, Brent Wilson was recently interviewed by the Post Register on the future of vacant retail space in the Eastern Idaho commercial real estate market. In the article, Brent mentions that there is interest in Idaho Falls’ vacant retail space. However, he expects the buildings to be reused in new ways.
“It’s what we call adaptive reuse,” Wilson said. “The businesses are going to be the experiential/entertainment-type of uses, golf simulation for one example. There’s also going to be multiple vocational schools occupying big box buildings.”
The food processing industry continues to grow in the Magic Valley. McCain Foods, the world's largest manufacturer of frozen potato products, recently celebrated the grand opening of their new 259,000 square foot facility in Burley, Idaho. The project began construction in February 2018 and is a roughly a $200 million investment.
Downtown Boise’s overall retail vacancy ended May at 3.7% - the lowest rate on record. Currently, the submarket sits with less than 34,000 SF of vacant space – smaller than the size of one big-box space.
Check out the retailers moving to Downtown Boise:
