Leases for nearly 500 Bed Bath & Beyond stores as well as a handful of distribution centers and warehouses are about to go on the auction block as the retailer begins liquidating as part of its bankruptcy.
A&G Real Estate Partners on Tuesday said it will be marketing 475 Bed Bath & Beyond and Buy Buy Baby retail leases nationwide in its role as the firm's real estate adviser. In addition, A&G and JLL plan to market a data center that the retailer owns in Claremont, North Carolina, as well as nine leases for distribution facilities in California, Georgia, Pennsylvania, Nevada, New Jersey and Texas.
The auction bidding process must still be approved by the U.S. Bankruptcy Court for New Jersey, where Bed Bath & Beyond filed for voluntarily Chapter 11 bankruptcy protection late last month. The Union, New Jersey-based retailer is looking to start an orderly wind-down of its operations, while conducting a limited marketing and sale process to solicit interest in some or all of its properties.
This year so far a number of troubled retailers — some still reeling from the pandemic and from consumers later tightening their purse strings — have sought Chapter 11 protection, most recently a company that Bed Bath & Beyond once owned, Middleborough, Massachusetts-based Christmas Tree Shops.
Bed Bath & Beyond's demise will put vacant real estate on the market, but a number of retail analysts and brokers have said the company has prime store locations that will probably attract off-price retailers, dollar stores, discounters and other growing chains such as grocery stores.
As of its Chapter 11 filing, Bed Bath & Beyond said it had 360 namesake stores and 120 Buy Buy Baby locations.
The banner stores slated for auction, located in 48 states and Washington, D.C., range in size from 18,000 to 92,000 square feet, according to A&G. The Buy Buy Baby stores, located in 37 states, are 14,000 to 63,000 square feet.
“There are many desirable, strategically located stores with both high visibility and traffic,” A&G Co-Founder Emilio Amendola said in a statement. “Moreover, these leases represent an incredible opportunity for an array of operators nationwide, due in part to the tremendous diversity of size ranges in play.”
A&G expects strong interest from national, regional and local players, according to Managing Director Mike Matlat.
“With limited new construction, acquiring leases at auction is an efficient way for junior anchor tenants to meet growth goals by back-filling second-generation space,” he said in a statement. "Landlords are among the likeliest bidders for these leases. They’re looking forward to getting vacant spaces back, either to backfill them with single large-format tenants or subdivide them and re-lease them to multiple, smaller operators.”
The warehouse and data-center locations range in size from 189,000 to more than 1 million square feet, according to A&G.
"Several of these well-located facilities boast below-market, fixed-rent leases with one or more renewal options,” Matlat said.