Retail may be sizzling in New York City, but industry experts anticipating the rise of online shopping are predicting brick-and-mortar retailers will reduce the amount of square footage they lease across the U.S. in the next few years.
Megastores like J.C. Penney and Macy’s announced major store closings recently, and Sears is now set to close its flagship Chicago store after shuttering hundreds of stores, according to NBC News. Retailers across the U.S. are expected to shrink their stores by one-third to half of their current size in the next five to 10 years, said Michael Burden, a principal with Excel Space Retail Services, to NBC. With retail rents soaring to more than $1,000 per square foot in New York City shopping meccas like Soho and Lower Manhattan, the pressure to downsize is even greater.
“I believe we’re going to hear a lot more announcements in the coming months,” of retailers shrinking their presence, Burden said to NBC. It’s “an indication that there is a shift in the retail environment and it’s one that will continue.” [NBC News] – Angela Hunt