Tenant forecast brightens along U.S. 224

At least 26 storefronts are vacant along U.S. Route 224 in the township.

By DON SHILLING

VINDICATOR BUSINESS EDITOR

Despite mounting vacancies,

better days seem likely along U.S. Route 224 in Boardman.

Two empty stores — the former Carter Lumber and Kids ‘R’ Us sites — have businesses moving in, and other deals are pending.

Local deal makers say retailers remain interested in Mahoning County’s busiest shopping corridor, but no one is moving fast because of the uncertain economy.

“These deals keep dragging on,” said Bradley Nair, who manages the Boardman Plaza. “What used to take six months to a year now takes 18 months to two years.”

He’s confident, however, that the plaza’s 35 percent vacancy rate will be reduced over time. WP Realty of Philadelphia, which bought the plaza in 2007, is in final negotiations with two prospective tenants.

Two other businesses plan to open along Route 224, signaling a possible reversal in the growing number of vacant storefronts.

Petco is opening in early February in the Kids ‘R’ Us site, and Raphael’s School of Beauty Culture has bought the former Carter Lumber site for $750,000. It plans to move its Boardman school there from Market Street this summer.

Bill Kutlick, a commercial real estate broker who arranged the sale, said he’s working on three other deals for new tenants in the area of Route 224 and South Avenue.

A deal for a 4,500-square-foot space is in the final stages of lease negotiations, but the other two are further from completion, he said.

Kutlick said he’s 80 percent confident the deals for a 30,000-square-foot site and a 50,000-square-foot site will happen. As he worked on those deals in the past year, vacancy signs have continued to sprout.

Big retailers Circuit City and MVP Pool and Spa closed last year as did several smaller ones.

In addition, large stores that closed in 2008 — Linens-N-Things, Value City Department Store and Poland Furniture Accessories — remain vacant.

Route 224 has 26 vacancies from West Boulevard to Interstate 680.

Kutlick said, however, that he isn’t discouraged as he takes a long-term view of the retail corridor.

“We have what retailers are looking for. Youngstown has a lot to offer because rents are extremely attractive, and the population density is still there,” he said.

He said electronics retailers are looking at the street, and he described the Value City location as prime real estate because of the high traffic count at the South Avenue intersection and the nearby I-680 exit. “It’s ground zero,” he said.

Retailers with sound business models will succeed here, he said.

Chains have closed stores along Route 224 because of their corporate problems, not because they were having problems in this market, he said. Circuit City and Value City were doing well here, he said.

As national retailers take their time on opening new locations, Kutlick predicted the area will have a shuffling of the retail deck. Businesses such as Raphael’s will move onto Route 224 from secondary locations, and those secondary locations will be filled by businesses that are now in lesser retail areas, he said.

Chris Boring, owner of Boulevard Strategies, a Columbus consulting company, said 2010 appears to be a good climate for entrepreneurs and one segment of the retailing industry that is doing well — pet stores.

Fashion sales dropped 20 percent during the recession, but sales of clothes for pets went up 100 percent, he said.

“We aren’t buying clothes for ourselves, but we’re buying clothes for our pets. How did that happen?” he said.

Entrepreneurs are moving in to vacant spaces for two reasons, he said.

First, many baby boomers have lost their jobs and are looking to do something they are passionate about. Second, big chains are reducing their store sizes and carrying more private labels, which means vendors are getting squeezed off store shelves and are looking for new retail outlets.

By and large, though, retailers are wise to be cautious, Boring said. The economy is improving, but increases in consumer spending will be slow.

“A new frugality has taken place in the minds of consumers. They are not going to spend like they did before. The credit-card party is over,” he said.

Local businesses agree that times are still tough, but they see reasons to be optimistic about 2010.

Ron D’Alesandro, owner of La-Z-Boy stores in Boardman and Howland, said sales started to pick up this fall after a bad spring and summer. Sales were up 7 percent in October, 27 percent in November and 20 percent in December.

“We’re starting to see some confidence in people who are coming in,” he said.

Lori Bortmas, manager of Party Max in the Shops at Boardman Park, said strong sales at Halloween and New Year’s helped the store finish with sales even to 2008. “We were pleased with that,” she said.

She’s hoping for a better year in 2010 but added that consumer behavior is hard to predict.

“Everyone who came in before New Year’s [Day] had a smile on their face. Whether that was just because 2009 was over, I don’t know,” she said.