Chain retailer on south Iowa Street closing down quickly, creating another vacancy near Lawrence Target store
The story for Topeka-based Payless ShoeSource seems to be there is not enough Pay and whole lot more Less these days. That’s apparently the case in Lawrence, as the company’s one local store on south Iowa Street is closing quickly.
Employees at the Lawrence store at 3231 Iowa Street were telling customers this weekend that the store would close either on Dec. 27 or Dec. 28, depending on how quickly inventories were depleted. The store had begun a liquidation sale with all items priced 40 to 60 percent off.
Technically, employees were telling customers that Payless would reopen in Lawrence at another location. But the employees acknowledged the company had not found a new location in Lawrence, and that the closing of the Lawrence store was a rather sudden development.
A reopening may end up being the case, but you could also see how that might not happen. Payless is struggling as a company. From late 2016 to early 2017, the company closed about 900 stores. It came out of bankruptcy this summer, but area economic development leaders are still worried about its future. The company is attempting to sell its corporate headquarters facility in Topeka and pretty much won’t return calls from city and economic development leaders in that community, according to reports by the Topeka Capital-Journal. The company, though, has acknowledged that it is evaluating its structure. That involved laying off about 170 employees in November, which followed layoffs of about 165 workers in January.
That’s probably a bigger concern for Lawrence than whether the company operates a discount shoe store in the south Iowa corridor. There are quite a few Lawrence residents who work at the Topeka headquarters of Payless. Topeka and Lawrence don’t have many corporate headquarters jobs, so a Payless departure would be a blow.
The pending closure does worsen a bit of a bad look on south Iowa Street, particularly around the Target store. The Payless closing will result in at least the third empty building near the Target store. The former Pier 1 Imports building continues to be be vacant after that retailer closed in January. The former Steak ’n Shake restaurant building also remains empty. That restaurant closed in March 2016. That could be a sign that there is some weakness in the retail market, or it simply could be that those closed businesses still have leases outstanding on the properties.
Often, businesses sign leases for five or 10 years at a time. When they close, they’re still liable for those leases, and landlords of buildings don’t always spend much time or effort trying to find a new tenant if there is still an active lease. That leaves it to the closed retailer to try to find someone to sublease the property. Some of these chain retailers have enough problems that they don’t have much time to spend trying to find a retailer for their space in little old Lawrence. That’s why it appears Lawrence dodged a bullet when a deal emerged to redevelop the former JCPenney building after that retailer closed. (As a reminder, Hobby Lobby, Marshalls HomeGoods and Five Below are going into the former Penney's building across the street from Target.) Absent such a deal, that building easily could have sat empty for a long time because of such lease issues.
The Payless site, though, may be worth watching for something new. According to land records at the county courthouse, the property did change hands in 2017. The property is now owned by a Kansas City-based company that has ties to the commercial real estate firm RH Johnson Company, according to records from the secretary of state’s office. A separate company owns the property next door to Payless, which includes the old Pier 1 building. But that company also has ties to RH Johnson Company, according to the secretary of state filings. RH Johnson Company is the Kansas City-based commercial real estate firm that led a remodeling of Lawrence's Tower Plaza shopping center that included adding a Popeyes, a Pie Five pizza restaurant and other enhancements to the property.
I have no word that the company plans any major makeover for the properties near Target, but it does seem like something to watch. And if I hear of anything about a new location for Payless, I’ll pass that along too.