Seven Years After Bankruptcy, Seven Unique Adaptive Reuses of Former Toys R Us Stores
Over 90% of former Toys R Us sites now have new tenants or -- in some cases -- new uses
On September 18, 2017 — 7 years ago today — Toys R Us filed for bankruptcy.
All 725 of its Big Box retail stores closed for good.
Over 30 MM square feet of commercial real estate was vacated.
But now more than 90% of former Toys R Us sites have new tenants or new uses.
While other retailers have re-tenanted ~80% of Toys R Us stores, over 100 sites have been repurposed for non-retail uses.
So 7 years after bankruptcy, let’s take a look at 7 unique and creative adaptive reuses of former Toys R Us real estate.
Uses that include a church, a collision repair shop, a U-Haul storage facility, a pediatric healthcare center, a Tesla dealership, a Veterans Affairs clinic and even multiple enclosed indoor car wash units!
Centerbranch Church — Bridgeport, West Virginia
From Toys R Us to a Church?
By 2018 Centerbranch Church in Bridgeport, West Virginia had outgrown its space.
Attendance at the 15 year old church had expanded from fifty to several hundred people per week and its space was spread across three different buildings.
Centerbranch wanted to consolidate operations in a single building with room for a larger sanctuary and an indoor play area for children.
So what could be a better space option than a 47,000 square foot former toy store?
It turns out that the Toys R Us building was also in a more central location for Centerbranch’s congregants and conveniently located at a highway exit.
So just one year after Toys R Us closed for good, Centerbranch acquired its building on a pad site of Bridgeport's Meadowbrook Mall for ~$2 MM.
It then completed a $3 MM renovation of the toy store into its new church campus.
Hertrich Collision Center — Salisbury, Maryland
From selling Toys to servicing vehicles:
The former Toys R Us in Salisbury, Maryland was converted into a collision center for the Hertrich chain of auto dealerships.
The Toys R Us building was modified to include repair bays, parts storage and a paint shop — and is one of more than two dozen Toys R Us-to-automotive conversions.
U-Haul of Annapolis, Maryland
Over a dozen former Toys R Us stores have been repurposed as self storage properties.
Including by U-Haul which completed an adaptive reuse of a 41,000 square foot Toys R Us store in Annapolis, Maryland.
The facility now offers climate controlled indoor self storage units and truck rentals.
And it is a prime example of U-Haul's business model which is to find sustainable ways to repurpose vacant Big Box buildings for its storage and truck rental operation.
U-Haul has been so successful at the former Toys R Us building that it even acquired an adjacent 900 unit storage facility to expand its offerings at the site.
Penn State Health Lancaster Pediatric Center — Lancaster, Pennsylvania
The former Toys R Us in Lancaster, Pennsylvania still serves children.
Only now it takes care of them.
The 47,000 square foot former toy store has been repurposed as the Lancaster Pediatric Center operated by Penn State Health.
Opened in June 2022, the Lancaster Pediatric Center offers 20 onsite medical and surgical specialties as well as walk-in care for children that live in Lancaster County.
Tesla Service Center — Akron, Ohio
In April 2022 Tesla opened a vehicle service center in a former Toys R Us in Akron, Ohio.
It is 1 of over 200 Tesla service centers in the U.S. — and 1 of at least 4 former Toys R Us buildings that have been converted into Tesla facilities.
But new vehicles cannot be sold at this site.
Ohio is one of several states where franchise laws ban or restrict direct sales by auto manufacturers like Tesla.
Per Ohio state law, Tesla can only have 3 sales showrooms in Ohio.
But it can operate an unlimited number of service centers in the state.
So this Tesla facility in Akron offers vehicle service but does not sell cars.
Department of Veterans Affairs Clinic — Des Moines, Iowa
The U.S. Department of Veterans Affairs opened a new primary care clinic in Des Moines, Iowa in August 2022.
The 42,000 square foot clinic supports Patient Aligned Care Teams (PACT), a patient-driven model that provides veterans with personalized, team-based healthcare that is focused on wellness and disease prevention.
The Des Moines clinic provides care to over 30,000 veterans in Central Iowa.
And it is a an adaptive reuse of a former Toys R Us.
Valet Auto Wash — Langhorne, PA, Rochester, NY and Syracuse, NY
The $15 Billion U.S. car wash market is growing fast.
New ground-up conveyor belt express washes are developed by Mister Car Wash, Driven Brands and others.
But not all conveyor belt washes are new construction.
Some are adaptive reuses of Big Box sites — such as former Toys R Us buildings.
One example is Valet Auto Wash in Langhorne, Pennsylvania — a fully enclosed car wash that features over 70 indoor vacuums, a dual conveyor belt “interior valet” service, and a Brilliance Wax Tunnel with buffing equipment and silicone wax.
And all services are provided within the walls of a ~40,000 square foot former Toys R Us building.
Not only that, but the Pennsylvania car wash is not even Valet’s only repurpose of a Toys R Us:
Valet Auto Wash has also converted former Toys R Us stores in Rochester and Syracuse, New York into indoor car wash units.
So why was the Toys R Us real estate in such high demand by retailers and others?
Excellent Locations — Toys R Us stores were located in dense, high traffic corridors, near major road intersections and with excellent access, parking and visibility. Stores were often adjacent to strong retailers in thriving open-air shopping centers and/or in “land scarce” areas with little new development opportunities. Just 12 of the 725+ stores were in interior malls.
Freestanding Buildings / Adaptive Re-Use Potential — ~37% of the Toys R Us stores were freestanding buildings. They generally had high ceilings, open floor plans, standardized column spacing and ample HVAC capacity suitable for a variety of uses. Most were unimpeded by restrictive use covenants or redevelopment prohibitions, enabling conversions to non-retail uses.
Market Share Capture — Toys R Us generated >$11 BB in sales of toys, clothing and furniture and many individual stores were profitable and generated significant high sales. Retailers that sold similar products had the opportunity to instantly capture additional sales and market share by locating in a Toys R Us that had a proven sales record and customer base.
The rapid re-tenanting and reuse of the Toys R Us real estate likely indicates that long term retail vacancies will be concentrated in functionally obsolescent properties with limited redevelopment flexibility (like many enclosed malls).
And as for the remaining retail real estate?
It may even be more in demand for a productive use…
Or a creative adaptive reuse!