More than a year after the Rite Aid on East Saginaw Street near the Frandor Shopping Center was vacated by the national pharmacy chain, the just over 11,000-square-foot building is poised to house six new tenants.
The property owner, Bloomfield Hills-based Lormax Stern Development Company, has leased all but about 3,000 square feet of the newly subdivided building to restaurants Shake Shack, Smoothie King and Wing Stop, and retail store Batteries Plus. There’s room for up to two more tenants, Drew Ford, the owner’s marketing director, said.
Taking an existing Rite Aid and subdividing the space is an investment, area commercial real estate agents say. It hasn’t and won’t happen with all of the empty Rite Aids left standing in Lansing, East Lansing and Okemos, and in smaller outlying communities, including Eaton Rapids and St. Johns.
But in highly trafficked areas, it can make sense, and the cost was worth it for the Saginaw Street property, Ford said.
“The visibility along Saginaw Street was very important for some of the tenants who are going into the space,” he said.
Rite Aid’s decision to close all its stores in Michigan after a 2023 bankruptcy filing left over a dozen storefronts or buildings empty in Greater Lansing. Here’s a look at what has happened to the properties, and why real estate agents think some have been easier to redevelop than others.
Former pharmacies become restaurants, retail space
The Saginaw Street building isn’t the only former Rite Aid property that’s already spoken for in Greater Lansing.
Sheetz, a popular Pennsylvania-based chain of convenience store/gas stations, wants to build its first area location at the northeast corner of East Saginaw Street and Abbot Road in East Lansing on property that houses a former Rite Aid. Sheetz is under contract to purchase the property.
The company has said the “restaurant with a drive-thru and four gas pump islands with eight pumps” at 111 E. Saginaw St. will employ 30 to 35 people.
A former Rite Aid on East Lake Lansing Road near Costco in East Lansing already has reopened as a Dollar Tree.
Another, located inside Brookfield Plaza along East Grand River Avenue, is being redeveloped to house retail and restaurants. New tenant RJ’s Burgers & Ice Cream Co., a restaurant chain based in Jackson, is slated to take about half the space.
UM Health-Sparrow opened a new pharmacy, urgent care and occupational health services center inside a former Rite Aid on the southeast corner of Michigan and Pennsylvania avenues over a month ago. The project required a full demolition and rehabilitation of the interior.
Redevelopment in smaller markets could be challenging
Redeveloping Rite Aid locations in smaller communities or at less visible properties will be more challenging, said Carson Patten of Martin Commercial Properties.
It’s unlikely that owners will subdivide vacant buildings that aren’t in high-demand areas.
“The ones that are tough are the ones in smaller markets where you might not have as much retail activity,” Patten said. “In well-trafficked locations, it’s easier to achieve that because there is more interest from retailers.”
A former Rite Aid on Cedar Street in Delhi Township will be sold at auction in mid-December. The over 11,000-square-foot building on nearly 2 acres is “ideal for a variety of uses, including hardware, discount retail, medical services, and more,” according to the auction listing.
“It’s an indicator that when you sell something at auction, it starts at a much lower bid, and it usually transacts for lower than the property is valued for,” said Samantha Le, senior associate with Martin Commercial.
The move is understandable, considering the area isn’t as densely populated as Lansing or East Lansing, she said.
Patten and Le said the buildings in smaller communities that are still vacant could suit the needs of an urgent care or regional beauty supply retailer. That’s what happened in Owosso where the local hospital, Memorial Healthcare opened an urgent care and pharmacy in a former Rite Aid.
None of what’s happened to the area’s former Rite Aid properties has surprised Le.
“Retail is always adapting,” she said. “But it’s interesting how flexible some landlords have been.”
Contact Reporter Rachel Greco at rgreco@lsj.com. Follow her on X @GrecoatLSJ.
This article originally appeared on Lansing State Journal: Vacant Rite Aids are seeing new life. What’s filling the space
Reporting by Rachel Greco, Lansing State Journal / Lansing State Journal
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