Hartford Business Journal

4 Hartford Business Journal | February 22, 2021 | HartfordBusiness.com Deal Watch By Matt Pilon mpilon@hartfordbusiness.com E mployers on the hunt for Class A office space may not think to check out the local shopping mall, but that may be changing in the age of COVID-19. The pandemic has battered the U.S. retail sector, driving bankruptcies and store closures to record highs. That's translated into some big, empty storefronts, and left real estate owners scratching their heads about how best to fill them. At two prominent Greater Hartford retail properties that are coincidentally right across the street from each other, new office space may be the desired solution. Brokers for the owners of the Corbin Collection shopping center in West Hartford and recently shuttered Lord & Taylor store at Westfarms mall just over the border in Farmington are working to find tenants who would repurpose tens of thousands of square feet of vacant retail space into office space. The pivot puts Greater Hartford in the center of a national trend — accelerated by the pandemic — that is reshaping the way landlords think about and use retail properties, experts say. "E-commerce started it, but COVID really got us thinking about how much retail we actually need," said Jason Beske, a senior planner with Virginia-based global design firm Stantec, who has studied examples of retail reuse in recent years. The bankrupt Lord & Taylor recently closed its Westfarms store, leaving vacant a 120,000-square- foot building once considered key anchor tenant space. Now, Canada-based Hudson Bay Co., which owns Lord & Taylor's real estate nationwide, is marketing the property through CBRE as a high-end office redevelopment or for medical offices. "I think the owner realized that large-scale retail stores may be a thing of the past and they are looking at this as an opportunity to repurpose it to something that would be unique in the marketplace as an office opportunity," said Michael Puzzo, a CBRE senior vice president in Hartford, who is leading the hunt for a large office tenant at the former store. CBRE is helping to repurpose shuttered Lord & Taylor locations in multiple states. Hudson Bay has branded the potential office space redevelopment as the "York Factory," with brochures showing an upscale, highly amenitized, modern office environment with an open layout, employee office pods, community space, a yoga and meditation studio and gym, among other potential perks. Puzzo said it's a large and rare Property Pivot Two prominent Greater Hartford retail sites eyed for new use amid industry shake up Corbin Collection owner Seritage Growth Properties is casting a wide net as it hunts for tenants for vacant former Sears space at the West Hartford shopping center. It has tapped Cushman & Wakefield Executive Director Joel Grieco (left), who specializes in the office market, and SullivanHayesNE broker Timothy McNamara, who specializes in retail, to pursue tenants. HBJ PHOTO | STEVE LASCHEVER offering in the region's office market, where new construction is almost nonexistent. However, York Factory will be competing with a glut of available office space in the market. Greater Hartford's office vacancy rate reached just over 20% at the end of 2020, the highest it's been in over a decade, according to CBRE data. "This is coming onto the market at a time when there are headwinds we're dealing with, but that said, there's nothing available in this market to this scale," he said. Forward-thinking tenants The Corbin Collection is a relatively new shopping center that debuted in 2018. New York-based Seritage Growth Properties redeveloped the site, which was the former long-time home of Sears before the retailer closed in 2017. Overall, the shopping plaza in the Corbins Corner section of West Hartford has been successful in luring retailers such as REI, Saks OFF Fifth, Buy Buy Baby, Cost Plus World Market and Shake Shack. It also has a Go Health Urgent Care clinic. But 45,000 square feet of space remains unoccupied and Seritage has hired brokers from Cushman Marty Kenny 2016 2017 2018 2019 2020 Announced store closures 805 2,863 1,586 4,299 4,974 Bankruptcies 26 36 29 27 70 Source: International Council of Shopping Centers; PNC RE Market Research Store closings and bankruptcies spiked in the retail sector in 2020, spurred in part by the COVID-19 pandemic. Pandemic spurred record retail contraction

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