Retail · Backfill demand
Joann Put 18.5 Million Square Feet on the Market. Who Took It
Joann liquidated more than 800 stores in 2025. The backfill tells you which tenants are actually expanding.
Joann filed for its second bankruptcy in under a year in January 2025 and, failing to find a buyer, wound down after more than eighty years. The liquidation brought roughly 18.5 million square feet across some 800 locations to market at once, most of it in suburban neighborhood centers, in the chain's typical 22,500 square foot format.
That is the exact box, in the exact location, that the current crop of expanding retailers wants.
Who moved
Burlington took 45 leases in a single court filing, spread across California, Texas and New York, with proposed cure amounts ranging from nothing to about $58,000 per site. Hobby Lobby and Boot Barn took others. The pattern repeats what happened with Bed Bath & Beyond, where Burlington alone assumed roughly 64 leases, and with Party City a few weeks earlier.
CoStar's read at the time was that most former Joann locations would be leased within a year, on the back of tight retail conditions and almost no new supply.
Why lease assumption is good news if you are the landlord
This is the part that surprises people. When a retailer assumes a lease out of a bankruptcy estate, three things happen in the landlord's favor.
The acquirer becomes responsible for cure costs, the amounts the bankrupt tenant owed you when it filed. They become responsible for rent, insurance and charges immediately, before they open a single store. And because they are assuming an existing lease, there is no requirement for you to fund a tenant improvement allowance.
Compare that to a normal re-tenanting, where you pay the allowance, the commission and the downtime. A lease assumption gives you a stronger covenant at the same rent with none of the cost.
The catch
It only works where the real estate is good. Roughly 40 percent of Joann's locations sat in REIT and institutional portfolios, nearly double their 21 percent share of retail overall, and those are, on average, the better centers. Space in weaker centers did not clear at auction and reverted to landlords who then had to do the work.
Which is the honest summary of this whole cycle: bankruptcy is an opportunity if you own well-located real estate, and an expensive problem if you do not.
If the space reverts to you: Vacant pharmacy box model models the allowance, downtime and capital plan. If it does not, Strip Plaza underwriting shows what the recapture is worth.
Related notes
How to read this. These are working notes. Figures come from public reporting and from the models on this site, and market conditions change, check anything time-sensitive against the source before you rely on it. Nothing here is investment, tax or legal advice, and no note is a substitute for diligence on a specific property.
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