Signs of the times
Local retail landscape is changing as chains close - and it's not over yet
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BURLINGTON - Even as cars jostled for spaces at the Burlington Mall on a recent morning, there were troubling signs nearby. Inside, Sharper Image had been deleted from the tenant roster. Across the street, the block letters of a Mattress Discounters sign hung above an empty store, another victim of a Chapter 11 bankruptcy filing.
And around the corner on Middlesex Turnpike,
Pockets of empty stores are appearing in the Boston suburbs, the result of a string of bankruptcy filings and closures that have retailers, landlords, employees, local officials, and even shoppers - as they hold tighter to their wallets and scout for going-out-of-business sales - all worried. With analysts already fretting about a slow holiday shopping season, many retail and real estate specialists warn that the worst is yet to come nationally and locally.
"W e're cautiously watching the horizon," said D. Anthony Fields, Burlington's planning director, optimistic that most area stores will weather the prolonged downturn or recession without needing to close, even if revenues slow.
Outside Tweeter one day this month Thomas Lally, a customer for decades, lamented the closing of the Massachusetts-based consumer electronics chain and the scaling back of Starbucks.
"I think it means we're in for a little bit of a long haul," said Lally, a 69-year-old from Billerica who is retired from Belmont's police force. "It's one thing for the low end to be closing up, but when you start seeing the high ends, I think it's an ominous sign."
Over the last decade especially, big-box stores and chains flourished. Seeming to sprout ever larger, they clustered in new buildings near malls and highway exits and along multilane roads, luring credit-card-carrying suburbanites who powered a heady era of consumerism that paused, only briefly, after the attacks of Sept. 11, 2001.
"After that it became patriotic to shop, because we were going to show them that we were going to spend ourselves into oblivion," said Patricia Edwards, a national retail analyst based in Seattle. "And we did it really well, too."
Now, mounting bleakness for retailers has commentators in some parts of the country pronouncing the demise of an era in suburban shopping - with people in big SUVs going to big stores to buy stuff for big houses - and warning of a landscape littered with empty big-box stores and scarred shopping plazas.
Around Boston, analysts predict a slowdown, but not devastation. But if the future does not hold major changes for shopping patterns and habits, it almost certainly will bring more liquidation sales and vacancies.
"Anyone who doesn't think there will be additional vacancies is kidding themselves," said Joel Kadis, a partner with Linear Retail Properties, which acquires and operates shopping centers in eastern Massachusetts and southern New England, holding a portfolio of a few dozen plazas ranging from 10,000 to 125,000 square feet. "Most people think it's going to get worse before it gets better."
Retail insiders and analysts talk about the United States being "overstored."
"In a better economy, everyone can survive, but in a more challenging economy, you see the fallout," Kadis said, pointing to weaker companies in multiplayer categories - Circuit City compared with
The stronger ones survive, but maybe not thrive: Bed Bath & Beyond's stock has dropped to its lowest point in nearly a decade, on fears of same-store sales shrinking for the first time in the company's history; that's already the case for same-store sales at Best Buy, the credit rating of which Standard & Poor's recently downgraded to a notch above junk.
Retailers selling necessities, especially discounted necessities, are faring better than those peddling discretionary goods. Natick-based
The Boston suburbs are less "overstored" than other parts of the country, because of scarcity of land, population density, and permitting challenges, Kadis said. "It's not like the Sun Belt, where you keep moving down to the next tract of housing and you throw up another [shopping] center," and where many more vacancies will occur, he said.
Jonathan D. Miller, a New York-based analyst and author of the annual industry outlook "Emerging Trends in Real Estate," said strong malls and "power centers" - meaning the plazas with multiple big-box retailers that have sprouted near regional malls - will weather the difficult years with some vacancies, but weaker malls and centers could become empty.
"Over time, with an improved economy, Americans will buy again, and malls will thrive again. . . . It's just not going to be in the next two or three years," said Miller, whose guide, published last month by the Urban Land Institute and PricewaterhouseCoopers, predicts a bottoming out in 2009, with floundering to continue at least into 2010.
When retail rebounds, it will be in a changed landscape, Miller said. Types of stores and shopping centers will evolve and be reinvented, just as they have coming out of past downturns and recessions, with new concepts for the size, nature, and layout of malls and plazas.
In the meantime, consumers can expect more sales and closings, and the mixed emotions that accompany them. But problems with major chains are unlikely to dramatically alter the suburban shopping experience, said Virginia Postrel, the author and blogger who writes the "Culture and Commerce" column for The Atlantic, including a 2006 piece "In Praise of Chain Stores."
"I really don't think Circuit City going out of business has an impact on anybody's life as a consumer, as opposed to as an employee or supplier," said Postrel, who has praised chains for making more choices available in more places, at better prices, while challenging "cosmopolites" who equate a sense of place with locally owned businesses, instead of terrain, weather, and culture. "I can't think of any retailer that's gone out of business recently where I thought, 'Oh, that's really bad. People won't be able to get X.' "
Outside the already closed Linens 'n Things on a recent morning in Burlington, would-be shoppers passed by or paused to look in the windows.
Irene Petri, a retired paralegal from Arlington, said she was concerned by the closings and what it meant about the economy, though the loss of some bothered her more than others; she cited Fabric Place, once a seven-store regional chain, which is closing its final location.
Petri, a 71-year-old who grew up in post-war Germany, said the lone bright spot might be a return to frugality and saving.
"My concern is that people run up so much on their credit cards and they obviously do not concern themselves with how to pay for it," she said.
But others approaching the store seemed buoyant.
"Big-business chains that are going out of business don't bother me," said Jacqueline Carder, a 46-year-old Billerica homemaker and licensed EMT. Carder, who came in search of deep discounts, returned to her car, instructing another shopper to do the same.
"Go to Building 19 1/2. Do you know where that is?" she said, referring to the nearest branch of the chain that resells liquidated, overstocked, and gently damaged merchandise.
"All the stuff here is probably [there]."
Eric Moskowitz can be reached at emoskowitz@globe.com. 
