Strong economy helps soften blow of closings
Area malls exploring ways to fill space held by Sears, Elder-Beerman.
Sears announced it will close a third location in this region — this time in Piqua — leaving three area malls with giant empty retail spaces.
The Springfield Sears store will be the only Sears Holdings location left in the area when the store in the Miami Valley
Centre in Piqua is scheduled to close in February. The Dayton Mall store will close Nov. 25, and the Mall at Fairfield Commons store in Beavercreek will close sometime in December.
The Sears closures come in the wake of Elder-Beerman closing its large department stores at the same malls in August.
Sears Holdings, which also owns Kmart and has been closing stores for years, recently filed for Chapter 11 bankruptcy protection in late October. The company has announced a total closure of 228 stores since this summer.
While the closures will cost the region hundreds of jobs, the current economy is helping to minimize the effects with low unemployment and increased consumer spending.
“It’s never nice to lose a job, but it is true that there are a lot of job openings right now, so certainly those people should feel confident that they will be able to find a job,” said Michael Lipsitz, an economics professor at Miami University’s Fisher School of Business.
The bigger concern is if sales from the bankrupt Sears don’t transfer to other retailers in the Miami Valley, but instead move to online retailers, which would ultimately lead spending out of the region. That could cause tax consequences without the money moving through local governments and fewer people spending while unemployed immediately after Sears closes, Lipsitz said.
“You might just think about it as a moving around of money rather than a loss in particular,” he said. “But it might look like a loss to Ohio.”
But there is a benefit. “There’s some sense that Sears’ business model wasn’t working anymore,” he said. “Hopefully that’s being replaced by business models that are better for our community.”
That business model could include a larger focus on e-commerce that is shaping the current retail landscape. Ideally, that new business model finds a way to employ locally, Lipsitz said.
It could also contain experiences, which are increasingly becoming common in outdoor and indoor shopping centers as consumer shopping habits change.
“(The Piqua Mall) does have some unique opportunities to bring in something that would be unique and entertainment-like,” said Tim Echemann, principal with Industrial Property Brokers in Piqua.
The Mall at Fairfield Commons in Beavercreek has found success with the entertainment concept, planning to split the Sears space into entertainment concept Round 1 and The Room Place furniture store. But the Dayton mall is still working through plans to fill its space. The Elder-Beerman spaces at all three malls are also empty.
“Anticipating that this would happen, we’ve been working with some prospective tenants for quite a while actually. Sears’ troubles are well known and this closure was expected,” said Bill Staebler, the director of retail development for Mid-America, the owner of the Miami Valley Centre Mall.
Both the 100,000 squarefoot Sears location and the Elder-Beerman box at the Piqua mall have seen a interest from multiple parties, he said. But it’s not likely that the public will see any movement on the spaces for a few months since Sears isn’t expected to close until February and retailers have put expansion on hold while they focus on holiday sales.
“These are tough times in retail. We all get that,” Staebler said. “But we’ve owned the mall for 25 years, and we’re going to stick it out. We like the location, we like Piqua, we like the market.”
He said Piqua is particularly attractive because of its hotel, parking space and a location that is visible from Interstate 75.
And Piqua is in a thriving part of the state for a mall, though it is rural, said Tim Echemann, principal with Industrial Property Brokers in Piqua. It’s the right distance from Dayton to have a steady customer flow, especially with the growth of nearby Troy, while also being far enough away that residents choose to stay in the community rather than travel to Beavercreek or Miami Twp.
“The other thing that is really going in its favor is that the economy, with the election and what’s happened, we’re not going to see big changes to the economy and it’s going so strong right now that there’s never been a better time to land an opportunity for the space there.”