Walgreens, CVS, and Rite Aid have been closing locations since 2022, with hundreds more scheduled to be shuttered in 2026.
The question becomes, what happens to all of that space?
A recent article in Urban Land Magazine explained that these empty spaces offer multiple opportunities for savvy real estate owners and investors. “The real estate often sits in prime locations, and many of these brick boxes remain operationally flexible,” the article said.
Additionally:
- As developers take on smaller-format retail, stand-alone junior box formats—such as empty retail pharmacies—can be ideal for second uses.
- The sites are located at busy corners with heavy vehicular traffic or on grocery-anchored pads with heavy foot traffic. The article noted that they can serve as shadow anchors or as standalone pads.
The article suggested that backfilling can be a viable option for controlling costs and accelerating speed-to-market. “It avoids demolition costs, accelerates occupancy, and leverages existing infrastructure,” according to the author. Dollar store tenants, healthcare users and thrift operators have backfilled some of these spaces.
On the other hand, razing the site and commencing ground-up construction can be ideal if the land on which the building sits is highly valuable. Still, demolition also requires entitlements, environmental studies and the potential of extended timelines and overextended budgets.
The article predicted that backfills will occur in areas with tight retail supply. At the same time, redevelopment will take place in dense urban locations and high-value suburban intersections where land exceeds replacement costs.
“The stand-alone pharmacy era may be fading, but the underlying real estate is as valuable as ever, and just entering its next chapter,” the article concluded.
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