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New Stores Are Still Opening Despite The Pandemic

LEILA FADEL, HOST:

Something remarkable is happening in American retail. Despite the devastation of the pandemic, people are still opening brand-new stores. That's true about major chains but also about small shops. NPR's Alina Selyukh reports.

ALINA SELYUKH, BYLINE: On a gray, dreary February day, Marguerite Adzick looked out on ice caps floating off a desolate beach along the Jersey Shore. Coronavirus was surging again. And she had just told her investors she was about to sign a lease on her first brick-and-mortar clothing store.

MARGUERITE ADZICK: And they were just, I think, speechless (laughter).

SELYUKH: Adzick's small retailer Addison Bay did well online. It sells fashion forward athletic gear, puff sleeve sweatshirts perfect for Zoom, tie dye lounge sets for lockdown comfort. But a physical store in a world before mass vaccinations...

ADZICK: I think me even saying it out loud convincing to people was a little, like, comical. But we ran the numbers. We knew it would work.

SELYUKH: This is one of the parallel universes of American retail in 2021. It's become a world of seemingly contradictory trends. Legendary chains went under when Americans stopped buying clothes at the peak of the pandemic. Real estate firm CoStar group counted a record 12,000 store closures last year. But this year - for part of the year, anyway - store openings actually outpaced closures.

KENNY MINZBERG: We'll be opening a store in Tampa in the next couple of months. We opened in both Chicago and Detroit. We're also opening in Minneapolis.

SELYUKH: Kenny Minzberg is chief operating officer of Psycho Bunny, a seller of menswear reimagined with an edge - pops of color, bright brands and the logo that's part bunny, part skull and bones. The company went into the pandemic with five stores, then it tripled the fleet - now plans to have 29 stores by the end of the year, all of them in malls.

So it's the middle of the pandemic. And you guys are saying, let's sign a contract with, like, a bunch of malls right now.

MINZBERG: Pretty much, that's what we did. Yeah. We did see enough of life coming back to normal in call it May, June and July of 2020 that gave us the sense that people are pretty set in their habits. People are going to go back to shopping malls. It may take a little bit of time. But it's going to happen.

SELYUKH: There's a reason why retail is among the largest American employers. Minzberg says he remembers reading stories of cooped up shoppers driving for miles to outdoor malls just for a sense of normalcy.

MINZBERG: We also started to see immediately in any market that we opened an increase in our online business in those markets.

SELYUKH: And if you were going to bet on shopping as an American pastime for your business, the pandemic upheaval actually created some new opportunities. Enough retailers were going out of business that landlords got more accommodating, offering new tenants maybe discounts on rent or early exit options if shoppers did not return.

MINZBERG: There are two or three retailers that I think we've taken a couple of their stores in various locations.

SELYUKH: Coresight Research, which tracks announcements of store openings, has counted over 4,500 so far this year. Dollar store chains top the list, supermarkets and discounters like Aldi and Target, Burlington and Footlocker, beauty stores like Sephora - even Amazon is rumored to be planning, essentially, a department store, which brings us full circle to the beach town of Avalon, N.J., where Marguerite Adzick stared at the icy bay, thinking back to last summer, mid-pandemic, when she had tested the water for her first store while pregnant.

ADZICK: We decided to do pop-ups under tents on street corners, like, outside coffee shops at, like, 6 in the morning. I was there literally two days before I was delivering my child.

SELYUKH: Addison Bay, the online store, had gotten lucky with the right clothes for the pandemic needs, with the warehouse being close enough to Adzick's home that she could walk and ship out the orders herself. And then the summer pop-ups showed people were still eager to shop in-person. That's how Adzick did the math that convinced her to sign the lease for the retail space that suddenly became available in that gray, dreary month of February.

ADZICK: I wanted to say no. I truly was like, I'm not ready for this. And it was too good of a deal. I couldn't say no.

SELYUKH: Addison Bay's first store opened Memorial Day weekend to a line down the block in the rain.

Alina Selyukh, NPR News.

(SOUNDBITE OF BEACH FOSSILS' "MOMENTS") Transcript provided by NPR, Copyright NPR.