Retail bankruptcies and closures blow Walmart-sized hole in Columbia Center area

In the near future, there will be enough empty space in Kennewick’s Columbia Center area to contain the Pasco Walmart Supercenter — and then some.

That may not be a bad thing.

On Thursday, Shopko confirmed plans to close its Kennewick and Prosser stores by May 5, making it the third major retailer to announce plans to depart from the area in the past year.

Shopko, based in Green Bay, Wis., filed for bankruptcy in January. The chain will close stores throughout the Northwest, including Washington, Oregon and Idaho, as it works to restructure its debt.

Sears will leave about 160,000 square feet at Columbia Center when it closes in March. Shopko will open up about 106,000 square feet. And Toys R Us left 38,000 square feet when it closed last fall.

All three filed for bankruptcy, reflecting shifting retail priorities and fierce competition from the internet and discounters such as Walmart and Target. 

Together, they add up to more than 300,000 square feet of retail space — more than enough to contain the 214,000-square foot Road 68 Walmart.

It’s a striking figure, but it could open the market to fresh, new ideas as well.

“Columbia Center is still king,” said Rob Ellsworth, senior commercial broker with the Tri-City office of SVN | Retter & Company.

He predicts the Shopko space, which the company leases from a California-based owner, won’t stay dark long.

Columbia Center ‘dynamite location’

Built in 1989, it is one of the few large retail spaces available near the mall that fronts Columbia Center Boulevard. It is neighbors to the thriving Ranch and Home store.

“There’s a reason Texas Roadhouse wanted to be on that corner,” Ellsworth said. “It is a dynamite location.”

It’s too early to speculate about what might go in, but the corridor has famously been without a grocery store for decades.

Simon Property Group, which owns Columbia Center mall, has not commented publicly on its plans to fill the Sears and Toys R Us spaces. Mall manager Barbara Johnson could not be reached Thursday.

But last fall, Dick’s Sporting Goods confirmed it will open in a 50,000-square-foot store where the former Regal Cinemas stood. It’s already under construction.

Forever 21, a popular clothing retailer, is moving into a 12,000-square-foot spot near Victoria’s Secret inside the mall.

Ellsworth said he remains bullish on Columbia Center. As the region’s major destination mall, it draws shoppers from throughout southeast Washington and northern Oregon.

Retail still strong

The numbers back it up.

Retail is a key driver of job growth in the Mid-Columbia. The industry employed 14,000 at the end of 2018, 250 more than the year before, according to the Washington Employment Security Department.

And Tri-Citians are spending more than ever.

Local cash registers rang up $1.33 billion in taxable retail sales in the first six months of 2018. That was 3 percent more than the first half of 2017, according to the most recent figures from the state Department of Revenue.

Closing stores still painful

The retail closures are still a blow. This week’s news that Shopko added the Kennewick and Prosser stores to its closure list drew more than 250 comments on the Tri-City Herald’s Facebook page.

Elsewhere in Washington, Shopko is closing stores at Lacey, Pullman, Quincy, Union Gap, Walla Walla, Wenatchee, Yakima and three stores in Spokane.

In Idaho, it is closing stores in Idaho Falls, Nampa, Orofino, Pocatello, and two stores in Boise.

In Oregon, it is closing stores at Bend, Eugene and Salem.

The full list is posted to the company’s restructuring information site, info.shopko.com.

Sears and Toys R Us

Sears Holdings , which owns Kmart stores, filed for bankruptcy in October as the Hoffman Estates, Ill.-based company struggled with heavy debt and falling sales.

The Tri-Cities Sears at Columbia Center was added to the closure list in late December, with a target closure date of March.

The Kennewick store is apparently not one of the 425 stores that will be saved after a bankruptcy judge approved a $5.2 billion asset sale Thursday.

Simon, the mall’s owner, reportedly sees the Sears locations as turnaround opportunities.

Analysts report the company submitted a bid for some of the Sears location in the bankruptcy auction, seeing an opportunity to bring in more profitable retailers.

Toys R Us closed its 800 stores, including the one at Columbia Center, in 2018.