The vast, mostly vacant parking lots around many malls and big box stores could be paved with gold.
Faced with shrinking sales, mall operators, big box stores — like Target, Lowe’s, Home Depot, Macy’s and JCPenney — and other anchor tenants have started to reimagine their acres of unused parking lots as redevelopment opportunities that could create new revenue streams, The Post has learned.
The stores and real estate companies are looking to either sell the land to a developer or rent it to complementary businesses — like restaurant chains — interviews with several companies revealed.
The country’s No. 1 department store, Macy’s, on Tuesday became one of the first to go public with such plans.
The chain said it has identified at least 50 of its 841 stores that are ripe for a parking lot makeover — or other type of real estate repurposing.
“We don’t need the massive parking lots that we had in the 1970s,” Doug Sessler, the head of Macy’s real estate division, told analysts during the company’s investor day on Tuesday.
In addition to developing parking lots, some retailers could perhaps shrink their operation to two floors in a three-story building — and lease the newly vacant floor.
“In the past, parking lot real estate was a sideline for many of these companies,” one real estate executive who represents major retailers and asked not to be identified, told The Post in a recent interview.
“It was never a high priority but, over the past 60 days, I have seen a sharp interest from them to discuss these lots,” the exec said.
A typical Macy’s store, for example, owns 20 acres of land, Sessler said.
Most municipalities require retailers to allow for five parking spaces per 1,000 square feet of retail, but increasingly that ratio is becoming “antiquated,” said Mark Hunter, managing director of retail asset services for CBRE. “Municipalities are relaxing these requirements because they are concerned about maintaining their tax base.
Some of the big box stores are hosting dedicated sites hawking their excess real estate — which they refer to as “out-lots” or “carve-outs.”
Target has listed a 1.5-acre out-lot outside a Waterloo, Iowa, store.
Lowe’s listed a nearly one-acre carve-out in Goldsboro, NC — one of 42 sites it is looking to develop. The end goal of these carve-outs is to drive more traffic to the stores, a Lowe’s spokeswoman said.
“We’ve done a fair number of transactions where a developer builds a car wash, Chick-fil-A or Chipotle on the site,” said Garland Hughes, a broker for the Providence Group, which represents Lowe’s sites in the Southeast.
Kimco Realty, which operates 500-plus shopping centers, said at a REIT conference this week that roughly 75 percent of their centers are underutilized.
“The question is, what do you do with this space?” said Christopher Pappas, director of corporate finance for Fitch Ratings. “People have their pencils out and are trying to figure out what sort of numbers they can squeeze out of their properties.”