Getting creative about creating space
For years, the narrative in retail real estate has centered on a lack of available space — and that reality isn’t changing anytime soon.
In many of today’s most sought-after markets, particularly throughout the Northeast, new development remains limited while retailer demand continues to grow. The result is a simple but pressing challenge: Where can expanding retailers go when there’s little to no space left to lease?
Increasingly, the answer is not about finding space — it’s about creating it.
In this environment, leasing has evolved into something far more strategic than simply filling vacancies. At Levin Management Corporation, we are seeing this firsthand across retail properties in some of the Northeast’s most supply-constrained markets. It has become, in many ways, a chess game. Owners and operators are thinking holistically about their centers—repositioning assets by moving pieces around, reconfiguring space, relocating tenants, and using key anchor opportunities to drive broader transformation and create centers that better align with how consumers shop, dine, and spend their time today.
Sprouts blossoms in Bridgewater
At Somerset Shopping Center in Bridgewater, N.J., for example, a former Christmas Tree Shops box presented an opportunity to do more than simply backfill space. By introducing Sprouts Farmers Market, the center gains a strong grocery anchor aligned with today’s consumer demand.
At the same time, the deal is serving as a catalyst for broader reconfiguration — moving existing retailers to optimize space, creating opportunities for additional national tenants, and expanding the presence of fitness and service-oriented uses. The result is a more productive and better-balanced merchandising mix across the property.
A similar strategy is playing out at New Jersey’s West Orange Plaza. There, the former Kmart was redeveloped into a 150,000-sq.-ft. Target, significantly elevating the center’s profile and traffic. That anchor transformation opened the door for additional growth, including the development of new outparcel space to meet strong retailer demand. Even before construction is complete, Phase I of the expansion is already nearing full occupancy, with leases signed or under active negotiation for new restaurants, fitness users, and service providers that will further strengthen the property’s role as a community shopping destination.
At Blue Star Shopping Center in Watchung, N.J., long-term planning also played a critical role. Space was reserved within the center for the development of a new ShopRite, which opened last April and now serves as a dominant grocery anchor. With that in place, the focus has shifted to reconfiguring the former space to accommodate Burlington and creating a new store for Marshalls.
The center has also upgraded its overall mix with stronger dining options, including Honeygrow, Raising Cane’s, and Taco Bell along with popular fitness and value-oriented tenants such as Planet Fitness and Five Below.
Tapping tenants that make centers stronger
These examples reflect a broader industry shift: today’s most successful retail centers are not static, but continually evolving to curate a tenant mix that better aligns with evolving consumer habits and expectations.
Importantly, this strategy is not limited to fully leased properties. While space constraints often drive the need for creative solutions, the underlying objective is larger: creating stronger, more relevant centers. That means identifying underutilized or outdated space, optimizing footprints, and introducing uses that drive both traffic and engagement.
For retailers, this shift underscores the importance of flexibility. Opportunities may not always come in the form of traditional vacancies, but rather through repositioned space within an evolving center. For owners, success requires looking beyond individual deals and taking a long-term view of how each leasing decision contributes to the strength of the overall asset.
In today’s constrained market, available space is no longer simply the starting point — it is often the result of strategic planning. By embracing reconfiguration and taking a comprehensive view of their properties, owners are not only responding to limited supply, but also creating stronger centers that are better aligned with today’s consumers and positioned for long-term success.
Matthew K. Harding is the CEO of Levin Management Corporation.