Pop-up Stores, II

In Retail Thoughts on September 22, 2010 at 10:22 pm

Labor day is long gone and the buzz in the retail world is now about holiday shopping, predictions and trends. One of 2009’s hottest retail trends is looking even more relevant in 2010: pop-up stores.

I’ve come across several articles and blog posts in the last week talking about the Toys R Us announcement that it will open 600 pop-up stores by the end of October (it had 90 last year). NPR’s Weekend Edition just did a piece on the 19th about Halloween themed pop-up stores (NPR link) that will be occupying big vacant retail space for the next six weeks. There’s Ricky’s, Halloween Express, iparty (above pic is of the iparty pop-up on Boylston Street in Boston) and many others.

Those of you that have read my blog since the start know that I have very mixed feelings about pop-up stores. I wrote last February that “Pop-up stores haven’t fundamentally changed retail real estate yet but they have the potential to really shake things up – for good and bad.” Well, now 8+ months since this post, it is indeed looking like pop-up stores will bring about fundamental change to the retail real estate industry. And it’s not just in busted strip malls in suburbia — pop-ups are appearing in Manhattan, Chicago, LA, Boston and everywhere in between.

Here is what I previously wrote (and still believe) about pop-up stores on 02/03/10: (read more)

…eBay opened a “pop-up store” in NYC this past holiday season. eBay wasn’t alone. Pop-up stores hit Boston and many other major metro areas during the 2009 holiday shopping season. This retail trend is both interesting and problematic.

Pop-up stores fill spaces but don’t make places. Pop-up stores add minimal value to communities in the long run. They might add value to emerging neighborhoods by brining short-term buzz and attention but I’m typically not seeing pop-up stores used for this goal (the best and most valuable concept I’ve ever seen in this respect is the Puma City that was in South Boson last summer as part of the Volvo Ocean Race; art galleries are a bright spot as well). The upside for landlords is typically short term cash-flow and some activity in what would otherwise be dark space.  Good things? Sure. Ultimately though, from the retailer perspective, pop-up stores are dangerous. If I’m a tenant in a long term lease and an international retailer moves in for 6 weeks of the year, during the busiest weeks of the year and competes with me… well, I’m not going to be happy.

Andrea Chang of the LA Times is dead on in asserting that “Pop-ups’ move to the mainstream was born out of the recession: Desperate landlords are able to fill vacancies in their shopping centers, and nervous retailers can get space for a few weeks or months without signing a long-term lease.” (LA Times 10/17/09). Pop-up stores haven’t fundamentally changed retail real estate yet but they have the potential to really shake things up – for good and bad. Regardless, pop-up stores are a topic of interest to CityRetail. We fully recognize that a combination of short and long term uses are critical for the creation of exciting city places but we are cognizant of the fact that a balance must be struck. Farmers markets, seasonal beer gardens and food trucks are other exciting pop-up type uses but they must be examined as they relate to existing long term retail tenants…

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