Albertsons closing: Loss of anchor sets malls, centers adrift

By Alicia Wallace
Longmont Ledger

This fall, Boise, Idaho-based Albertsons LLC decided to close two stores in Boulder County, including one in the Westview Plaza at 1750 Main St. in Longmont.

Mark Rosneck owns the EmbroidMe shop at 1716 N. Main Street in Longmont, in the same mall where Albertsons recently closed its store. He says his shop is a destination business that won’t be effected much by the loss of Albertson’s.

The empty anchor issue is not unfamiliar to Boulder County shopping destinations as some malls and centers have been negatively impacted by changing retail dynamics — notably large retailers trimming their store base or succumbing to bankruptcy.However, the recession and a weak retail environment create twists for Westview Plaza and other regional centers with dark anchors, some say.

“It’s the old Catch 22,” said Mark Rosneck, owner of the Embroid Me custom embroidery shop in the Westview Plaza. “Somebody has to be looking for a space in north Longmont. … But there’s an awful lot of big spaces around throughout the city.”
A ‘shocking’ loss

Despite the neighborhood grocery closing, Rosneck said he is quite hopeful for the success of his business. The 1-year-old shop is a destination retailer, he said, adding that his business is buoyed by the workers and trades people that frequent the nearby Chipotle and Five Guys Burgers and Fries.

“They’re actually looking for ways of differentiating their small businesses,” through Embroid Me’s offerings including promotional products, screen printing and personalized gifts, Rosneck said.

A few doors up at Westview Liquors, co-owner Kim Bui said she was “shocked” about Albertsons closing.

Bui estimated her 6-year-old store might take a 20 percent to 25 percent hit in foot-traffic because of the Albertsons departure. However, she said she remains optimistic because of her business’ longevity, the continued support from its regulars and its locale on U.S. 287.

Nearly 60,000 square feet of contiguous space could be hard to fill even in a healthy economy, so the vacancy is complicated given the recession, said Brad Power, director of economic development for the city of Longmont.The space, he speculated, could end up being carved into smaller-sized spaces.

“The pace at which retailers are developing new locations has slowed down everywhere; we’re not immune to that,” he said. “The (Westview Plaza) is pretty strong otherwise.”

Power cautioned that there could be a lot of work left in the commercial real estate and retail sector, which were not only negatively hit by consumers and businesses pulling back on spending, but also the credit crunch and subsequent crisis.

“This community, though, has really set the stage for trying to be a proactive as possible,” Power said.

Albertsons’ closure will impact the Westview center and people’s shopping patterns, Power said. He said grocery dollars should remain in the city and could be bolstered by the potential arrival of natural groceries including Sunflower Farmers Market and Sprouts Farmers Market that are eyeing locations off Hover Road and at the Twin Peaks Mall, respectively.

In recent weeks, however, the Sunflower deal has become less certain, as the developers of a property adjacent to The Home Depot on South Hover Street squabble with the city.

Longmont isn’t alone in facing the departure of an anchor store. Lafayette lost its Albertsons,

and during the past year, a number of large and anchor-worthy retailers including Macy’s, JC Penney and Sears have closed hundreds of stores and others, including Circuit City, Mervyns and Linens ‘N Things went bankrupt.

A tenuous economy also is forcing healthier retailers to rethink their strategies, Ryan Severino, an economist for real estate research firm Reis Inc., wrote in an Oct. 15 report.

“Retailers that would have otherwise expanded to capitalize on the depressed environment are delaying expansion plans until after the holiday season, hoping to obtain even more attractive lease terms from battered landlords,” he said. Reis officials project increasing vacancy levels and negative effects on rent for neighborhood and community centers through 2011.

“We have yet to observe any unexpected systematic resumption in hiring and strength in consumer spending that might lead us to revise our projections with amore optimistic bent,” Severino said.