1 of 2 surviving Kmarts is in … the Hamptons? 

The blue light is shining bright in the Hamptons.

Discount retailer Kmart has closed all but two of its U.S. stores in recent years. One survivor is, curiously, in Bridgehampton, one of the richest towns in the country, where Hermès bags and Lamborghinis don’t draw a second glance and the median home price is nearly $4 million.

Kmart’s woes have been well documented. In 2018, some 13 years after it combined with Sears, the holding company filed for Chapter 11 bankruptcy. One year later, Sears’ parent, Transformco, purchased the assets and began systematically wiping out stores before they bled the coffers dry.

More than 2,000 Kmart stores were operating in the early 2000s, including Long Island locations in West Babylon, Farmingville, Bohemia and Huntington. Just two besides Bridgehampton’s remain: Miami and Westwood, New Jersey, the latter of which plans to close by October.

Somehow, the Kmart at the Bridgehampton Commons shopping center on Montauk Highway seems immune to the wave of closures. Low prices and a lack of competition have kept shoppers from all tax brackets coming back, East End real estate pros told The Real Deal.

“It’s supply and demand,” said Carol Sharks, a Sag Harbor-based real estate salesperson at Corcoran. “In the Hamptons, any sort of discount item is hard to come by. Not everybody in the Hamptons is the 1 percent, and they need places to shop too.”

It’s not just service workers or New York City day trippers flocking to the Bridgehampton retailer, either. “It’s a mix,” she said of the Kmart clientele. “Everybody likes a good deal.”

“Even billionaires go to Kmart,” said Compass real estate agent Hal Zwick.

“For the year-round population, there’s nothing as far as anything reasonable for clothing and home accessories,” Zwick said, noting that Bridgewater Commons’ big-box stores Kmart, King Kullen and Marshalls fill the need for stores that are accessible to everyone.

“Bridgehampton Commons is more of a suburban, middle-class type place. The year-round population does not shop at the villages,” Zwick explained, referring to the high-end boutiques in East Hampton and Southampton.

Kimco Realty Corp. owns the 32-unit Bridgehampton Commons, which has been open since 1973, according to county records. The Kmart opened in 1999, four years after former tenant Caldor filed for bankruptcy. It shelled out $7 million to assume Caldor’s lease, Newsday reported.

Kmart and King Kullen, a budget-friendly Long Island-based grocery chain, are the largest tenants at Bridgehampton Commons, combining for more than 150,000 square feet.

“Even billionaires go to Kmart.”
Hal Zwick, Compass

A Kimco representative verified that despite the flood of Kmart closings around the nation, the store’s lease is not for sale.

Kmart isn’t the only bargain store in demand at the shopping center. The adjoining TJ Maxx and Marshalls have gained a cult-like following on social media, with users spotting heavily marked-down designer bags and shoes.

In one instance, high-end purses selling on Moschino’s website for $300 were priced at around $100 at the brick-and-mortar location, Insider reported.

Should Bridgehampton’s Kmart ever go away, it probably wouldn’t be hard for Kimco to fill the space. Sharks, of Corcoran, has heard many folks wish for a grocer such as Target or Trader Joe’s to come to the South Fork. The nearest Target is in Riverhead, nearly 30 miles from Bridgehampton Commons; the nearest Trader Joe’s is in Lake Grove, more than 40 miles away.

But there’s no guarantee that Kmart’s space would go to a grocer — or a store of any kind. In Riverhead, the Feil Organization leased nearly 40,000 square feet of a former Kmart space to the Suffolk County Department of Social Services. At least two entertainment centers have been born out of former Kmart shopping centers in New Jersey, according to NJ.com. And a former Walmart in Riverhead went to a supplier of restaurant equipment.

Space and zoning don’t typically allow for grocery stores in an area like Bridgehampton, which has low retail inventory, said Zwick, adding that commercial development isn’t encouraged by local officials.

“Everybody wants Trader Joe’s, that’s a fact,” Zwick said. “Trader Joe’s needs more space. … We can’t accommodate that.”

Read more

Tri-State

Kimco pays $375M for Long Island shopping centers

Tri-State

Kimco books Barnes & Noble in Bridgehampton

Tri-State

New Jersey kisses last Kmart goodbye