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Online Sales, Economy Upend Huntington Businesses

Waldbaum's store to shut Saturday, the latest in a string of retail closings.

When in Huntington Station in November, the move sent shock waves through the community. Yet it turned out to be the first ripple in a torrent of closings that have stunned residents and businesses alike.

Huntington Station takes another hit Saturday when the East Jericho Waldbaum's closes its doors after 40 years.

But it's not all doom and gloom, experts say. They see the closings as a fundamental shift in the retail market. The changes in a 2.5-mile stretch along  Route 110 and East Jericho Turnpike may even indicate positive trends in real estate prices, a convergence that could knock out old businesses while making way for new ones.

"We’re in a different moment in time in how people do business," said economic insider Steve Rossetti, referring to the battle big-box stores are fighting against online retailers.

Rossetti, who serves as secretary of both the Suffolk Economic Development Corp. and the Suffolk Industrial Development Agency, said more changes will come.

Since November, chain stores – often headquartered several states away – chose not to build or opted to close stores already here, including:

Lowe's, which, after beginning site work, decided not to build on the East Jericho Turnpike spot previously occupied by the Huntington Town House, November.

Barnes & Noble at the Huntington Shopping Center, closed at the end of December.

Toys R Us, at the same center, closed in January.

Harley Davidson Lighthouse, closed in January.

Penzey's spice store, near the Whitman shops, closed in January.

Blockbuster on East Jericho Turnpike  closed in February.

Waldbaum's, across the street from the Lighthouse, is closing Saturday after 40 years.

Even a in Huntington Station closed at the beginning of the year. Nearby, a Mandee's closed this week in Melville and an auto dealership recently closed in East Northport.

Huntington Station happens to be the victim of a much larger national pullback as chains consolidate, shutting down their least-productive stores or finding new leases too pricey. Around the country, overdevelopment and changes in technology and shopping styles are blamed for big-box store losses.

Huntington came off pretty well in a field study two years ago, according to Peter Lambert of the Suffolk County Planning Department, who said that the town showed a 9.4 percent vacancy rate compared to 12.3 percent in other parts of the county.

"I'm hoping Huntington is just part of the natural cycle (of change). It just happens to be a coincidental, dark period," he said.

One bright spot might be Walt Whitman Shops, which will announce its expansion details next week even as some long-term tenants, including Sbarro's, Zales Jewelry and McDonald's shut their doors.

Lambert said Simon malls have become more upscale than the non-Simon malls. "They are drawing from high income areas," Lambert said.

Town spokesman A.J. Carter said the mall upgrade is expected to change its assessment. A store vacancy doesn't affect the tax assessment as long as the building remains, Carter said. Even in the case of the Lowe's decision to pull out after knocking down the derelict Huntington Town House building, the assessment remains unaffected.

Carter said the town experienced a 3/4 of one percent decline in the tax base last year.

While several new stores may be on their way, the loss of some long-established businesses could continue.

When the closing of the popular Barnes & Noble store was soon followed by the shutdown of Toys R Us in the Huntington Shopping Center, many residents expressed concern about what was next. But the bookstore's closing was at least in part the result of a rent increase imposed by Federal Realty, the center's landlord. And so, too, Waldbaum's was identified as ripe for a rent increase when Kimco Realty bought Huntington Turnpike Plaza last year. Kimco said it expects to place another grocery store in the Waldbaum's space.

"We're probably going to see some changes in other sectors," Rossetti said. "You’ll see it in electronics, there will be some changes in that sector," and called Best Buy an example of "a sitting duck."

Part of the concern about the changing market reflects worries about the tax base.

Jim Kaden, president of the school board in the South Huntington school district, where most of the changes are occurring, said, "We’ve seen increasing tax assessed valuations declines pretty much every year for last 20 years.

"Every year that goes down everyone else's taxes go up," he said. "The problem we have in the town is that we have very little opportunity to increase the base."

There are some signs of new business in Huntington Station recently as an auto dealership opened on Oakwood Road and construction workers were busy at the Toys R Us and Barnes & Noble stores. In January, opened across the street from the mall; Berry Healthy Cafe opened near the vacant  Barnes & Noble.

Rossetti and others remain optimistic about what will come next. "The saying I have is that there’s a person for every seat," he said. "When it comes to a good commercial area, as soon as someone goes out someone else is willing to take a chance."

kath March 03, 2012 at 01:15 AM
Your article would lead one to imagine a doomsday scenario. You fail to mention that although these storefronts are presently empty, there are plans underway right now to occupy them . In fact,Best Yet is planning on taking over the previously occupied Waldbaums in the next two months. Perhaps your article should have been more concentrated the greedy landlords and their responsibilty to the community which their store occupies,rather then a scenario of empty storefronts meant to scare the residents of this town.
skip March 03, 2012 at 01:47 AM
Greedy landlords? How so?
Been Around March 03, 2012 at 03:08 AM
I'm not sure about where blame really lies, but school districts are at the mercy of the Town of Huntington in terms of assessed valuations. Aside from annual declines in real estate valuations, over all, this seems to be a rather murky or even hidden process, rather than one in which we can be comfortably reliant. A part of me, without having evidence, somehow suspects that there is some collusion between landlords, developers, real restate attorneys, and politicians (not only at Town Hall, but in the Democratic and Republican Party machines, as well). In other words, the taxpayers and the students and the districts are screwed.
kath March 03, 2012 at 03:31 AM
@ Skip, ToysRus lost their lease as did Barnes and Noble. Those two stores have always had a base and they performed quite well. The landlord didnt want them there anymore so that they could bring in high end retailers who they can charge much more per square foot. Simple.
belloq March 03, 2012 at 04:17 AM
Michael's is not "upscale" so I wonder when they will be forced to close too. Very sad situation. And where exactly near Huntington or Commack is the next nearest mall to WWM- Smithaven is 30 minutes drive; Roosevelt Field is 30 minutes drive? When did LI become podunkville where we have to drive long distances to find the things we want/need? I had to drive 40 minutes from the Commack area to find the nearest Toys R Us for a gift, and Target/Walmart just don't cut it for toy selection. The astounding divergence between the wealthy and the average is increasing. The story above is the result.
BillLongisland March 03, 2012 at 09:20 AM
Where oh Where are our "esteemed" political leaders ? Somehow I don't think "the Economy" is hurting them.
Hikerr March 03, 2012 at 10:01 AM
Pam, this was a well written article. Thanks and I hope more Patch reporters take note.
Free 2B Me March 03, 2012 at 01:44 PM
All of what has been observed here is in connection with an interesting intersection point in this economic cycle… the philosophies of retail distribution and real estate management. While the discussion of the real estate cycle is often focused on property values, little is discussed about rent. Property owners historically DO NOT reduce rents in the bottom of an economic cycle. I know that this may seem counterintuitive to average investors. Large commercial property owner 101 would prefer a large space to be vacant for an extended period before committing to long term reduced cash flows. Terms on rentals of these properties are for multiple years and often include concession for renovations. It is in those concessions wear some flexibility can be found, but not in the rent. Conversely, retailers will look to improve revenue in the bottom of the cycle by reducing prices (aka profit margins) and gain earnings on increased volume. When a lease matures, these dogmas conflict at the bottom of the economic cycle and result in vacant properties. Huntington does not hold the exclusive on this aspect of the economic cycle. The darn shame in this is the loss of jobs. Realize too that there was a ton of job creation during the expansive times a mere 7 years ago. Each cycle is a watered down reflection of the prior period. We are coming off a period of great excess. We are already 4 years into the negative space, but this, like all things, shall pass.
Amy March 03, 2012 at 02:26 PM
Great article, Pam. I don't know if you can answer this, but do you know why Lowe's is pursuing the lot in Commack (I believe I read that somewhere) and leaving Huntington Station in the dust? Also do you know what stores will be replacing Toys R Us and B&N?d
Free 2B Me March 03, 2012 at 03:02 PM
Lowes will not comment, but it is clear that the site in Commack has a higher traffic count and requires far less property development. Lowes also practices a market strategy defined by Vernon Hill at Burger King of building close to your competition. Regardless of tax breaks and other incentives, the breakeven projections (on a fully funded basis) have to be earlier for Lowes at the Commack location compared to any undeveloped parcel. At least they were good enough to raze the catering hall before tightening their shareholder value strategy. Free 2B... me
Pam Robinson (Editor) March 03, 2012 at 03:33 PM
Thanks, Amy. I wish I knew more about what's coming in but Federal Realty had told us earlier that it planned to split the Barnes & Noble space into a few smaller stores. I think that with the mall going upscale, we're going to see something a pretty direct impact on what goes in to that center. While there are rumors that more current tenants will be leaving, absolutely no one who knows is talking publicly right now.
Pam Robinson (Editor) March 03, 2012 at 03:37 PM
Excellent point, Free2B'. There's still a lot of grading work to be done on the former townhouse site so yes, Commack is further ahead.
Pam Robinson (Editor) March 03, 2012 at 03:39 PM
Next week is going to be interesting--we should know much more next week about the mall's plans. Other than Vera Bradley, I don't know who's coming in but the mall has raised its sights since the days of toy stores and fast-food shops.
Concerned Resident March 03, 2012 at 09:59 PM
Heard the same thing about the mall from a few people working there. Their plans include more upscale shops. One name mentioned was Prada.
Seeing Eye March 03, 2012 at 10:24 PM
I spoke with Lowes management at their Farmingdale location 3 days after they made the decision to abandon the Jericho Tpke site. I was told that local property owners were demanding the town require Lowes to construct elaborate decorative retaining walls and landscaping. To appease this vocal minority, the town added this onerous caveat to the Lowes Certificate of Occupancy requirements. Given this several million dollar increase in construction cost, Lowes made a business decision and decided to cut their losses. The Town of Huntington is responsible for this. One can only imagine how much this would have added to our tax base. They killed the goose that laid the golden eggs.
Gene March 04, 2012 at 03:06 PM
Good job Huntington. Your loss is someone else's gain.
Mr Middle March 05, 2012 at 12:36 PM
I am curious to know why this information wasn't reported in the media. There is nothing wrong with making sure the site is appealing. I guess we should put an oil refinery on that land. It will lower gas prices and provide jobs. Thats what most people want, right? I would like to know why the town seems impotent in dealing with abandoned buildings. These eyesores like the Indian restaurant on West Jericho Turnpike or the two vacant auto repair shops on New York Avenue in Halesite have been around for years and bring down the whole neighborhood. Tear em down and send the bill to the landowners.
Pam Robinson (Editor) March 05, 2012 at 12:43 PM
Mr. Middle, if you're referring to the retaining wall comment, we heard a similar rumor while we were preparing this story. The town says it's not true.
Dan N. March 05, 2012 at 08:45 PM
So the mall and the B&N shopping center will no longer be places I can afford to shop, as a Huntington Station resident. The locals will have to go elsewhere to buy affordable goods.
TM March 05, 2012 at 11:53 PM
Well, can't afford to live in Huntington and can't afford to shop in Huntington either!
Jay March 12, 2012 at 12:58 AM
What exactly is going on with the WW mall and the adjacent B&N / ToyRus properties?? Why is it being kept secret? Why is it left up to "hearsay"? Why isn't it public knowledge? It all seem a bit suspicious and very unnerving to all of us who reside in the surrounding neighborhoods.
Pam Robinson (Editor) March 19, 2012 at 04:17 PM
Jay, we've asked both mall and realty companies to let us know. We're still waiting but until they're ready to tell us, there's not much we can do.
Idnar March 28, 2012 at 01:19 AM
Where did you here Michael's is closing? I have not seen that any where.

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