Another longtime shopping magnet disappeared from the city’s landscape two weeks ago when the Kmart store at 7201 Pendleton Pike closed its doors after three decades.
The department store that once bustled with a diverse crowd of patrons and its gas station now sit in eerie silence.
“In December, we had announced that between 100 and 120 locations nationwide would be closed due to poor performance and cost reductions,” said Kim Freely, a spokesperson for Kmart, which is owned by Sears Holdings Corp. “That store was one of those locations on the list.”
The Kmart was the last business to shut down in the now desolate shopping mall that sits near the intersection of Pendleton Pike and Shadeland Avenue, directly east of Interstate 465. A neighboring Fashion Bug and Payless shoe store in the mall had closed earlier. Nearby, tall weeds have begun to overtake a vacant Denny’s restaurant.
The Kmart’s Eastside neighborhood is among several in the city witnessing a mass exodus of businesses from retail centers.
Mike Saldago is someone who understands the kind of economic pain these departures can bring. He manages a Revol Wireless location in the North Eastwood Shopping Center near the intersection of 38th and Post.
Although the center still has several shops and a restaurant, it is blighted by a vacant Big Lots department store, which closed earlier this year, as well as an old Kroger and shoe store. Saldago’s business is sandwiched at the east end of the center between the closed Big Lots and the shoe store.
“It gets a little lonely over here sometimes,” Saldago said. “When the big businesses leave, a lot of our potential customers go with them. It hurts those of us who depend on a lot of traffic.”
Across town, Aaron Dodd and his friend Momo-Seih Kandakai enjoy an animated conversation as they carry their bags of lunch and walk near the Northwest Shopping Center on West 38th Street.
At one end are several stores, while the other end has vacant structures, including a closed Circuit City with a decaying parking lot, an abandoned Kroger store and a grassy area that was once home to Olive Garden and Ponderosa restaurants.
“I guess the competition just became too much for the places that closed,” Dodd said. “There are so many places people can go around here. You can go around the corner to a Meijer or Wal Mart to easily get what you want.”
Why goodbye?
Depending on whom you talk to, the two main reasons businesses leave certain areas are economics and crime.
Kmart, for example, explained that its Pendleton Pike location was closed because it was one of many that were underperforming, due mainly to declining sales in the consumer electronics and apparel categories, as well as lower layaway sales.
“Given our performance and the difficult economic environment, we had to implement a series of actions to reduce on-going expenses, adjust our asset base, and accelerate the transformation of our business model,” CEO Lou D’Ambrosio said in a statement. “We expect these store closures to generate $140 to $170 million of cash as the net inventory in these stores is sold. We also expect to generate additional cash proceeds from the sale or sublease of the related real estate.”
Calls requesting closing information from the corporate headquarters of Big Lots in Columbus, Ohio, South Carolina based Denny’s and Darden Restaurants of Lakeland, Fla., which owns Olive Garden, were not returned by press time.
In a press release, the owners of Circuit City noted that all of its locations had been closed due to bankruptcy. Its products are now only sold online at circuitcity.com.
John Elliot, a spokesman for Kroger, said its locations on West and East 38th streets were shut down because their business plans were not met.
“Each store operates as its own profit center,” Elliot said. “There are business goals they are expected to meet, including financial measures and customer service measures. Despite remodeling and other significant investments, these stores could not be turned around. They had been underperforming for a long period of time.”
Elliot added that the store on East 38th Street had been in the bottom 10 among Kroger’s 2,500 stores for 11 years before it was finally closed.
Some observers, however, speculate that crime has driven some businesses away from certain neighborhoods. At the North Eastwood Shopping Center, Saldago and Revlo Wireless employees use the protection of a security guard. He speculates that crime led to the closure of the neighboring Athlete’s Foot store.
“It had been robbed three times,” Saldago said. “Who could blame them?”
In addition, the nearby Kroger had witnessed a shooting in its parking lot shortly before closing in 2009.
Elliot said when Kroger closed its stores on West and East 38th streets, speculation arose from the media, customers and elected officials that the decision was prompted by crime.
“That was not the case,” Elliot said. “Admittedly, the East 38th Street store had a history of higher than average crime, but there are other stores in the company that incur high security costs from shoplifting and other crimes and yet they’re still open because they are successful stores.”
Making the adjustment
Ironically, some of the residents of areas with departing businesses are not heartbroken about seeing them go.
Kandakai has friends who live on the Eastside and have already adjusted to the loss of the Kmart there by shopping at a Wal mart located further east in Lawrence.
Kandakai, who lives on the Westside, said he used to shop at the Circuit City and Kroger at the Northwest Shopping Center, but has since found other nearby places to find goods.
“We have a Save-a-lot not far from here, and the Meijer is like a grocery store and department store in one place,” Kandakai.
“This is not a bad area, so my guess is everybody who left was just not getting enough business,” said Nyaneka Toriey, who works at a restaurant in the shopping center. “The good thing is that we can go around the corner and get what we need. The bad part is that these closed buildings don’t look good in our neighborhood at all.”
Next week: What city officials and neighborhood groups are doing about declining shopping centers.
