Big-box stores becoming big empty boxes

OREM — At a former Home Base store in Orem, beer bottles litter the parking lot and boards cover the windows. The 150,000-square-foot building has been empty so long, the paint on the outside walls seems to be fading.

In the last few years, hundreds of big box stores have been abandoned across the country. Some, like the Home Base store, were abandoned by bankrupt chains. Others, like the Wal-Mart store in American Fork, were left behind for bigger digs.

What city leaders across the Wasatch Front are learning is that big-box stores are not easy to fill once they go empty. Orem now has 350,000 square feet of empty big-box space, the most the city has ever had. Provo has two large grocery stores that have been empty for more than a year.

"People look at these empty buildings and they think, 'Why doesn't someone just move there?' Well, economically, it just doesn't make sense," said Marc Cohen of Commerce CRG, which has sold more than 800,000 square feet of empty retail space in the last two years, most of it big box stores. "It's hard to improve existing property. Sometimes there are lease issues to deal with. It can get very expensive, and retailers want to keep costs low."

Rather than moving into a building that would require extensive renovation, or tearing down a store and starting over, retailers often choose cheap, virgin land, Cohen says, which explains the explosion of retail growth in Lehi, American Fork and Lindon.

Vacant big boxes aren't just an eyesore, they sometimes attract crime and drive down property values. And while land owners still pay property tax, shuttered businesses no longer provide jobs or generate sales-tax revenue.

"From a retail standpoint, the No. 1 priority for economic development is to fill empty spaces," says Brad Whitaker, director of Orem's economic development office. "No one wants to see an empty box."

Orem has aggressively worked to fill its empty spaces, Whitaker says, offering incentives and aid to interested retailers. For Orem, the biggest incentive to offer is location.

"With all the growth to the north, it's a different era. But we think with our central location in the county, we're still king of the roost," Whitaker said. "We try to stay in front of developers and real estate agents, to let them know where the empty boxes are and to make sure we're in their minds."

In Orem, construction work is under way to remodel Carillon Square, a 138,000-square-foot strip mall that is 30 years old. A vacant Ross Dress for Less, which moved to another location down the road, was demolished to make way for a new Best Buy store. The 35,000-square-foot electronics retailer will anchor the strip mall.