The fate of Macy's Burlington space up in the air

Now that Macy's has announced it will be closing its downtown Burlington store in March, what's next?

It won't be replaced by another big department store, predicts Gene Beaudoin, director of retail development for Saxon Partners in Hingham, Massachusetts. 

"There are no natural tenants for 150,000 square feet on two floors," Beaudoin said. "You're going to either have to retrofit to apartments and retail on the first floor or office, apartments and retail on the first floor or some combination of that."

Beaudoin wouldn't speculate on the value of the property, but said the cost of retrofitting it for a new use would be subtracted from the sales price.

"Macy's has to acknowledge that it's not in move-in condition, because nobody would move into the space as is," Beaudoin said. "The buyer has to spend a lot of money to make the property profitable."

Beaudoin developed the Shaw's stores in Colchester and Berlin, and the Hannaford store in Rutland. He is also working on real estate projects in South Burlington.

More:Macy's closing its downtown Burlington store

The assessed value of the Macy's property is more than $11.1 million, according to the City of Burlington grand list. That assessment was done in 2005 and has not been contested, according to Burlington City Assessor John Vickery.

"Over 10 years out, the market changes, and by and large, the values have been increasing throughout Burlington," Vickery said. "That doesn't mean it increases for everybody."

A spokeswoman for Macy's said she couldn't answer questions about the building other than to say the company owns the Cherry Street property. 

Beaudoin said that once the store closes in March, Macy's will have one year to sell it before they have to write it off their books, taking a "fairly hefty loss."

"They'll be trying to release or sell the building to get it off their books," he said.

The logical buyer of the property, according to Beaudoin, is Don Sinex, of Devonwood Investors, LLC, who is building the $225 million Burlington City Place. The project is redeveloping the adjacent mall, which was formerly known as the Burlington Town Center. Demolition began last month.

Sinex did not respond to a request for comment as of 5:30 p.m. 

Macy’s announced Wednesday that it would be closing its Burlington store as part of at least 100 planned store closures. Emily Hawkins, director of Northeast media relations for Macy's, said Thursday that 65 employees work at the Burlington store.

More:Sinex sees ‘vertical rather than horizontal’ growth

Employees were also informed of the closure Wednesday.

The downtown store converted from a Filene's store to Macy's in 2006. The site was a Porteous department store before it became Filene's. According to city records, May Department Stores purchased the location in 1999 for just over $700,000. Macy’s Inc. acquired May Department Stores in 2005, according to Bloomberg.

Ron Redmond, executive director of the Church Street Marketplace, and Becky Cassidy, the organization's media relations person, both said Thursday that they were sad about Macy's closing but optimistic about the opportunities it presents.

"In many ways, this closing was inevitable," Redmond said. "We've been waiting for it, and now it's happened. We have many advantages in that we have a very successful and vibrant pedestrian mall that has really supported the downtown. The redevelopment has been helped by the presence of Church Street. ... We see good opportunity in the space being redeveloped in the redevelopment of the mall."

Redmond said his organization met with Macy's, and the building it occupies is in "great shape."

Several people inside the section of the mall still open Thursday expressed disappointment at the news of Macy's closing.

Charlie Finnigan, who has lived in Burlington for about 60 years, said he felt discouraged by the news and was worried about the greater economic ramifications for the city.

“They’re tearing this place apart, and it takes a while to put something up, and you can’t do business like that, having all kind of noise,” Finnigan said.

He added, “It seems like everything is moving out of Burlington. … This is a great city, we’ve got a great restaurant situation here in Burlington, but this is a real let-down.”

Allan Schwartz, who was visiting Burlington from Montreal on Thursday, said he and his family come down from Canada several times a year to shop. He said he was sad to hear that Macy’s was closing.

“That’s not going to help the city any, is it?” Schwartz said. “I guess everybody shops online now.”

Despite his disappointment, Schwartz said he was not surprised at the closing. He said some shopping centers in Montreal are also “hurting.”

“I guess it’s just a sign of the times,” Schwartz said.

Contact Dan D’Ambrosio at 660-1841 or ddambrosio@freepressmedia.com. Contact Elizabeth Murray at 651-4835 or emurray@freepressmedia.com.