As more stores close, Twin Cities suburbs wrestle with future of big-box stores

Never mind the drab green carpet and old fitting rooms, leftovers from the empty store's previous life. What mattered to Brandy Gilbert were the cavernous ceilings — perfect, she thought, for a zipline.

The warehouse? Great for pallets of water and Gatorade. The sprawling parking lot? Ideal for the thousands of visitors that Gilbert figured would venture to the shuttered Sports Authority store in Coon Rapids after she transformed it into an adventure park.

"I could see it," said Gilbert, who now owns Minnesota's only Urban Air location, which opened last year and offers attractions like trampolines, climbing walls and a ropes course.

As thousands of big-box stores go dark nationwide, husks of once-shiny retail spaces are sitting empty across the Twin Cities, touchstones of the changing realities of retail. But signs of life are stirring as cities and brokers work to fill big boxes and smaller "junior boxes" with either new retailers or new uses, from schools to adventure parks to fitness facilities.

Some cities are taking a more aggressive redevelopment approach, actively courting desired tenants or even reducing derelict stores to rubble. Others are joining what real estate analysts describe as a growing movement to split the mammoth spaces into more bite-sized pieces.

That's the case in Blaine, where at least seven spaces either sit empty or will soon be closed. Work is now underway to subdivide two big-box stores for new tenants.

"It's difficult to find anybody that needs to take up that much space. You have to work hard and find the right match," said Erik Thorvig, Blaine's economic development coordinator. "We're working our best to get the spaces filled because we know vacant buildings can eventually be a drain on the area."

A record-breaking 110 million square feet of retail space nationally has been slated for closure so far this year, according to real estate research firm CoStar Group, which has been tracking such totals since 2008.

The growing list of troubled retailers reads like a cheerless stack of sales catalogs. Chains like Toys 'R' Us, Herberger's, Kmart and Sears account for much of the recent churn, including at least 20 Minnesota stores already marked for closing this year. That's on top of structures already left behind by the likes of Sports Authority, Rainbow Foods and Circuit City.

As they await redevelopment, lifeless stores can become much-maligned eyesores on the municipal landscape.

"It's just an absolute disaster," said Charles Marohn, president of the Brainerd-based nonprofit Strong Towns, which promotes smart growth in cities. "It's like a big black hole in the middle of a community that has all this cost and relatively little tax base."

Critics of car-centric sprawl say American retail is already massively overbuilt, leaving cities on the hook for maintaining the infrastructure around big-box stores even after they go dark. When a retail giant comes to town, the city makes a "forever commitment" to maintain the roads, sidewalk, pipes, sewer and stormwater systems that it requires, Marohn said.

There's a clear first step, he said, in tackling the big-box dilemma: "We have to stop building these things."

In some suburbs, expanding retailers are scooping up existing structures rather than breaking ground on fresh ones. Companies like Hobby Lobby, MN Home Outlet, HOM Furniture and Hy-Vee have taken over vacant buildings in New Hope, Brooklyn Center, Woodbury and Coon Rapids.

Empty stores in prime locations are getting snatched up first, said Brad Kaplan of Colliers International, a commercial real estate company with offices in the Twin Cities. But years may pass before new tenants coax some empty stores back to life, often for less traditional uses.

An old Rainbow Foods will soon be resurrected as a special education school in Inver Grove Heights. Eagle Brook Church bought an old Kmart in Anoka in 2016 and transformed it into a new campus. More than a decade ago, the Hennepin County Library's Eden Prairie branch moved into a renovated Lunds grocery store.

Some cities let market forces decide what reuses come to town. Others are more assertive.

Two retail sites in Brooklyn Center have been guided by a hands-on approach. A shopping center anchored by Walmart replaced Brookdale, the major shopping center that lost its luster years ago and was largely torn down in 2011. The development, known as Shingle Creek Crossing, was boosted by city tax incentives.

Nearby is a 32-acre site that once housed Brookdale Square, which included a strip mall, movie theater and Ford dealership. Brooklyn Center's Economic Development Authority bought and cleared the property in two phases starting in 2008. City officials envisioned a walkable, mixed-use area and waited for the right suitor; in March, they struck a preliminary agreement with Minneapolis-based Alatus to redevelop the site.

"The city was very proactive," said Meg Beekman, community development director.

As consumer habits change, city officials say they've seen an influx in "experiential" businesses moving into vacant stores, including fitness studios and entertainment hubs.

That's what Gilbert had in mind when she overhauled the Sports Authority in Coon Rapids. Families now zigzag through the once-vacant store, climbing, jumping and swinging through attractions inside.

"Everybody leaves tired," Gilbert said.

In nearby Blaine, a vacant Gander Mountain soon will be remodeled for a similar use. The building is being subdivided for several new tenants, including a family amusement center with a casual eatery, bumper cars, laser tag, mini-bowling and other games. Blaine officials say they're adapting the city's zoning code for less traditional uses.

Across town on a recent afternoon, crews were tearing into the facade of a long-vacant Kmart, readying it for three new tenants that include an Xperience Fitness gym and Auto Zone.

But stores still in need of new uses sat just down the road near Northtown Mall. Yellow "Going out of business" banners flagged Herberger's plight, while a handwritten "We are closed" sign was propped in the front window of a darkened Toys 'R' Us.

When residents wondering what's next contact City Hall with their concerns, Thorvig said he often tells them the same thing: "It's not unique to Blaine."

Hannah Covington • 612-673-4751