On a freezing, snow-covered Friday in early March, Andy Graiser and Emilio Amendola are standing in the parking lot of a suburban Long Island strip mall, ruminating on the evidence of drastic changes to the retail sector over the last 25 years.
One side of the strip houses a 10,000-square-foot Ulta Beauty next to Tilly’s, DressBarn and Modell’s. In 2012, when the pair started workout firm A&G Realty Partners, based in Melville, N.Y., that same space was almost entirely occupied by a Barnes & Noble. Going back further, a Tower Records and a Pergament paint store.
“From what it looked like before to what it looks like now, you never would have expected this,” Amendola says of the mix of stores and restaurants that now make up the strip mall. Left unsaid and largely unseen is the fact that he and Graiser have played a role in driving that transformation by helping retailers extricate themselves from underperforming stores, negotiate rent reductions and optimize their real estate assets.
In today’s ultracompetitive climate, retailers are finding themselves with limited options for expansion. Industrywide, net new-store growth is virtually nonexistent. Consider that U.S. shopping center space grew by an annual average of 169 million square feet from 2000 through 2008. For the last five years the pace has slowed to less than 50 million square feet per year.
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