PHOENIX - Barely three weeks ago, Joal Watson's business dream came true.
She opened the doors of Boutique 610 near the corner of Alma School and Queen Creek roads in Chandler.
Watson scouted several locations in the Valley before settling on a space flanked by two vacant storefronts.
Those storefronts didn't bother her, nor did the potential closing of a Target store and the loss of a Bashas' supermarket just across the street.
"Looking at other stores closing, they tend to be a little more big box, so I was happy to put in a smaller business," Watson said.
Watson's clientele -- women looking for high-end, one-of-a-kind clothing and handbags -- aren't necessarily affected by the high traffic from big box retailers.
But the same can't be said for Dave Goode. The New York native opened Buono's Pizza just across the street from Watson six months ago. Then he watched as Bashas' closed its store just a few doors down.
"Very busy corner, very busy shopping center some nice quality merchants like Bashas' in here. Obviously that's been dashed," Goode said.
Goode doesn't believe he has been here long enough to take advantage of Bashas' customers, but he knows the lack of traffic will make it more difficult to bring in new customers in the future.
"I'll survive," he said.
Across the Valley, dozens of business owners are wondering about their future too, as big box retailers and anchor tenants close their doors, even in places like Chandler's Ocotillo area, which can boast a high percentage of residents with discretionary income.
According to the latest report from CBRE Richard Ellis, in just one year, the amount of vacant big box space rose from 5.5 million square feet to 8.4 million square feet, a 52 percent increase.
By the end of the 3rd quarter, there were 285 available spaces of more than 10,000 square feet, up from 204 a year ago.
Experts say it illustrates an old adage: "retail follows rooftops."
As the housing market continues to sputter, it will bleed over into the commercial market. According to the Ellis report, the Valley's retail vacancy rate rose to 10.9 percent in the third quarter, up 57 percent from a year ago, and marking the ninth straight quarter of increased vacancy rates.
What's alarming to market watchers, however, is the number of big box vacancies.
Developers often seek out an "anchor tenant" when developing retail space, ensuring an established name will attract traffic volume to lure smaller businesses.
When that big box becomes vacant, it's notoriously difficult to find a new tenant, and it can spell trouble for the smaller stores left behind.
"Those existing businesses that are adjacent to the anchor, that may have relied on the anchor tenant ... they may have an existing customer base, but it may be more difficult to draw new customers," said Kevin Schuck, of CBRE Richard Ellis.
Just like the housing market, Schuck sees a slower recovery outside of the Loop 101 and 202, where housing values are particularly depressed.
Ellis analysts note consumers are also tightening their belts across the board, saving more and spending less on clothing and consumer goods.
Register and receive Ellis reports
