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From checkout lines to vaccine lines: Vacant big-box stores get new life as mass vaccination sites

Lauren Zumbach, Chicago Tribune on

Published in Business News

At a former Kmart store in Des Plaines, Ill., the parking lot was full and a steady stream of people walked through the building’s sliding glass doors.

No one was there to shop: what was once the last remaining Kmart in Illinois is now one of Cook County’s COVID-19 mass vaccination sites.

The store’s sign has been swapped for a banner announcing the vaccine site, and a member of the Illinois National Guard greeted people at the entrance Thursday morning. Racks of merchandise have been replaced by rows of tables and chairs where people check in and get their shots.

“Kmart has really changed,” joked Matt Demers, 39, of Chicago, after receiving his first dose of the Pfizer vaccine.

Spacious buildings, ample parking and easily accessible locations make vacant big-box stores good places to get shots in arms fast. That’s brought crowds back to some properties left empty even before the coronavirus pandemic heightened challenges for bricks-and-mortar retailers as people stayed home.

But vaccination sites are only a temporary fix for landlords trying to figure out how to reinvent spaces as retailers increasingly look to smaller stores and online sales.

“As retailers come back post-COVID, they’re not going to want to make that big investment in an anchor space,” said Victor Calanog, head of commercial real estate economics at Moody’s Analytics. “They’re not looking to cannonball back into the pool.”

The list of places in Illinois where people can get vaccines where they used to shop includes three former Kmarts, a Toys R Us in Joliet and Sam’s Club in Batavia. At Market Place Shopping Center in Champaign, there was so much demand the clinic expanded from a former Dressbarn to a second empty store, Gordmans. About 45,000 vaccines have been administered there since January.

Jean Luber, 63, of Chicago, said she was a little surprised to learn she would get vaccinated at an old Kmart, but impressed by the experience.

“It was run with militarylike precision,” said Luber, who was in and out in half an hour.

The store vaccination sites tend to be near major population centers, with plenty of parking and accessible, open spaces where officials can set up vaccination stations and design a flow of traffic, said Kane County board chair Corinne Pierog.

In addition to the former Sam’s Club in Batavia, Kane County has a site in a Carson’s in Aurora that has been vacant since the department store’s parent company, Bon-Ton Stores, closed all stores in 2018 after filing for bankruptcy.

“Instead of checkout lines, these adapted storefronts now have vaccination lines,” Pierog said.

In some cases, the properties’ former lives come in handy: At the Aurora Carson’s, fitting rooms provide space for anyone in need of medical attention after experiencing a reaction to the vaccine or those who want more privacy while getting their shot.

The question for property owners is what happens when vaccination sites are no longer needed.

Brookfield Properties is already in the process of securing new tenants to take over some of the stores hosting vaccination clinics at its malls, said Stephanie Brager, senior vice president of property management. But until then Brookfield, which owns Market Place, is in discussions about opening more clinics.

Some of those vaccine clinics are as small as 8,000 square feet and the two Champaign stores together account for about 40,000 square feet. Neither has been empty long: Dressbarn closed in 2019 and hosted a Spirit Halloween pop-up store last fall, and Gordmans closed in September.

Other empty stores getting a second life as a vaccine clinic are larger, and may be tougher to fill, said Moody’s Calanog, who got vaccinated at a former Sears in New Jersey.

 

The retailers that are expanding today, like dollar stores and specialty retailers, typically want much smaller spaces than those left by shrinking big-box chains and department stores, he said. Target, meanwhile, is planning to add 30 to 40 small-format stores this year.

Size has been a leasing challenge at another retailer-turned-vaccine site: the former Home Owners Bargain Outlet in Forest Park. The store has been empty since the home improvement retailer shut down all seven locations after seeking bankruptcy protection in 2018.

“It’s tough to figure out what to do with the depth of the space,” said Dan Hiffman, vice president at NAI Hiffman, who represents property owner Living Word Christian Center, a church at the shopping center.

Eventually the former store will likely be divided into smaller spaces for multiple retail tenants, he said.

Others will be converted into something entirely different.

The former Carson’s in Aurora was purchased by Storage of America about a year ago, and the company plans to turn it into a self-storage business with a couple of smaller spaces for retail tenants, said Rick Scardino, principal at Lee & Associates. While waiting to move forward on those plans, the owner saw an opportunity to “create some goodwill,” he said.

While the city might have preferred to see another retail tenant fill the space, many big-box stores like the former Carson’s will need to be adapted for new uses, he said.

“The United States has been way oversupplied from a physical retail standpoint compared with the rest of the world for decades,” he said.

Others may be converted to entertainment-focused businesses, a trend underway before the pandemic. While businesses relying on in-person events have taken a hit during the pandemic, they may bounce back because people will still want to gather in person, Calanog said.

The pandemic also accelerated the growth of online shopping. Only about 14% of all U.S. retail sales were made online in 2020, but online sales grew 32.4% compared with 2019, while total retail sales grew 3.4%, according to the Census Bureau. While that spike in sales prompted talk of converting shuttered stores to e-commerce warehouses, it isn’t a good fit for most properties, since it requires both large buildings and space for semi trucks to load and unload packages, Calanog said.

In the meantime, there’s one more reason stores are a good fit for vaccination sites: In several cases, property owners have been eager to make them available.

Brookfield Properties decided to offer space for vaccination sites rent-free. It was an easy call, Brager said.

“Our shopping centers really are an integral part of the communities they’re in, so it’s a pleasure for us to host these,” she said.

Even those charging for use of their space say they worked to get vaccination sites up and running fast.

Melody Winston, director of real estate at Living Word Christian Center, said she called local officials to offer the vacant space in Forest Park as soon as she heard vaccines were on the way.

Plans came together so quickly the facility was distributing shots before the license agreement for the vaccination site was signed, Winston said.

“I’ve got 100,000 square feet … and the place that was hurting was the West Side,” she said.

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