Retail brands that sell comfort-oriented home products, whether it be office furniture, bedding, chairs or couches, are in a great position for retail expansion in the future. More Americans, especially millennials with young families, are accepting the fact that the working-from-home trend appears to be here to stay, leading to demand for these home products. The higher-end home furnishing brands that provide both luxurious coziness and durability seem to be especially popular, as both adults and school-aged children alike are spending more and more time at home due to COVID-19 concerns. Customers have been more inclined to test out the merchandise with in-store visits, in order to see, touch and feel the products to validate the higher price tag for these items. Many of these brands are rolling out expansion into all manner of retail spaces, from larger showroom units to smaller-sized stores with staff that can assist customers with online ordering. Comfort-oriented brands expected to grow their footprint include Casper, Lovesac, Purple, Tuft & Needle and Jennifer Furniture. Look for Herman Miller and Arhaus to unveil new concept stores this year.
Mattress brand Casper, which went public in February of 2020, expects to open approximately 30 to 40 stores per year over the next three to four years. The digitally-native brand, which put the brakes on new expansion in 2020 because of COVID-19 concerns, is now primed and ready to increase its retail footprint. Markets ripe for growth include affluent suburban areas within Ohio, Connecticut, Georgia, North Carolina, Colorado, Virginia and Texas. Casper seeks approximately 2,000 s.f. of space in top-tier malls and retail street-front districts in suburban neighborhoods. Though it had previously directed its products toward the young millennial audience, Casper is now focusing on attracting older adults between the ages of 45 and 65 and looks for locations with a higher concentration of this demographic. Preferred co-tenants include Peloton, Apple, Lululemon Athletica and Tesla. Casper already has brand recognition because of its wholesale partnership with Target, and its namesake stores will sell sheets, bedside lamps, pillows and related bedroom accessories in addition to its high-density memory foam mattresses.
Lovesac expects to continue opening up to 20 new stores per year for the next two years. All regions in the U.S. are targeted, with an immediate concentration in the South and Southeast, including Florida, Georgia, Texas and Louisiana, as well as the more heavily populated suburbs of Arizona, New Jersey and Virginia. The Lovesac brand seeks inline, end cap or standalone spaces, between 1,000 and 2,500 s.f., in top-tier outdoor or indoor malls and lifestyle centers with a high concentration of affluent millennials with young families. Lovesac is especially keen on opening brick-and-mortar stores because its merchandise, which consists of modular furniture that can be reconfigured and is easily washable and changeable, needs to be demonstrated and experienced by customers. Lovesac is also known for its huge beanbag “chairs” that are filled with its proprietary “durafoam.” The brand also has “shop-in-shop” set-ups in some Macy’s and Costco Wholesale stores.
The mattress brand Purple expects to open approximately five to 10 stores per year over the next two to three years in major metropolitan markets, especially in the South and the Southeast. Look for Florida, Georgia and regions within the Midwest to see new stores. Purple seeks space in the 4,500- to 4,800-s.f. range, including short-term leases in Class A malls and lifestyle centers in major metropolitan markets. Preferred co-tenants include upscale female-centric brands such as Kay Jewelers, as well as children-oriented stores such as The Lego Store. Purple will be opening its new 520,000-s.f. manufacturing facility in Blacksville, Ga., in early 2021 to help with its anticipated growth into nearby regions. The Purple brand already has great customer awareness, as it its products are sold in stores such as Mattress Firm, Macy’s and Bloomingdale’s. As of February 2020, Raymour & Flanigan, the Midwest furniture retailer with 143 stores throughout the Northeast, also began carrying the brand.
Purple hired a new chief retail officer in 2019, who had previously been instrumental in expanding the retail footprint of Lovesac. Purple’s retail stores also sell smaller ticket items, including dog beds, eye masks, pillows and weighted blankets, as a way for customers to become introduced to the brand without fully investing in a mattress. Purple is known for its waffle-like mattresses surfaces that feature its patented gel technology, which provides pressure relief.
Digitally native mattress brand Tuft & Needle, the first to create the “bed in a box” online ordering concept, expects to open approximately three to five new stores per year over the next two to three years. Thereafter, the brand will most likely ramp up its retail growth to five to 10 new stores per year from 2023 onward. Tuft & Needle seeks space between 1,400 and 2,500 s.f. in densely populated, ethnically-diverse neighborhoods, with Florida, Georgia, Virginia, Pennsylvania, New York, Colorado and Ohio in its radar. The retailer is open to all manners of real estate, including strip malls, indoor malls and standalone buildings, but prefers architecturally interesting spaces in or near mixed-use units on street front-retail districts. Preferred co-tenants include a mix of restaurants and visually unique stores such as Apple and Warby Parker. With its mattress brand well-known to millennials via online channels, Tuft & Needle’s retail stores aim to also attract the older demographic that may not be as comfortable with ordering mattresses on the web. The brand is well positioned for growth after its merger with Serta Simmons Bedding, LLC, as well as its wholesale partnerships with assorted Lowe’s and Crate & Barrel stores. Its premium mattresses, at a slightly cheaper price point than its competitors, are known for the proprietary adaptive foam that provides support without sinking in, as well gel layers that prevent one’s body from getting too hot.
Last May, Mason Asset Management and Namdar Realty Group purchased the Jennifer Furniture retail store brand (formerly Jennifer Convertibles until its rebranding in 2017). The brand now has five stores in New York and one store in New Jersey. The new owners are banking on the well-known brand recognition namesake of Jennifer Convertibles to ultimately open new Jennifer Furniture stores throughout the country. Expect new stores to begin opening in malls and power centers in the Northwest region in the immediate future, especially in New York and New Jersey, as well as Boston, Philadelphia and throughout Connecticut and Maryland. The stores will take up between 15,000 and 35,000 s.f. of space. New stores will most likely open in the distressed Class B and C suburban malls the joint venture owns, of which three new ones were purchased in 2020: the Meriden Mall in Meriden, Conn., the Belknap Mall in Belmont, N.H., and the Mesilla Valley Mall in Las Cruces, N.M. Mason and Namdar own a total of 60 malls, both regional and enclosed, in the U.S. as well as the Goodrich Quality Theaters brand. The Jennifer Furniture brand was adversely affected by the coronavirus and forced to sell, because its factory and inventory had been located in Wuhan, China. Its products include high-quality sofa beds, mattresses and sectional sofas that are both modern and cozy.
In November, Herman Miller opened new concept stores, known as Herman Miller Retail Stores, that each utilize 1,500 s.f. of space and focus solely on office chairs for the proliferation of work-from-home consumers. The brand’s third version of this new concept store opened in December in Austin at the Domain Northside mall. Herman Miller expects to gain a new ergonomic-seeking, health-minded customer base with these stores that feature a “seating bar” of the brand’s multiple office chairs, in which customers can “test drive” each one, including new updated gaming chairs for younger customers. These new stores will be in mixed-use shopping developments, lifestyle centers and open-air shopping centers in commercial districts. Expect to see five to 10 more such stores per year over the next two years, with preferred co-tenants being Lululemon Athletica, Apple and Rhone. The buzz on new markets possibly sought out include Miami, Raleigh-Durham, N.C., Atlanta, Washington, D.C., Scottsdale, Ariz., Seattle, Chicago, as well as Santa Clara and San Diego, Calif. The store concept should benefit from at-home workers who are now realizing the need to invest in their home office set ups. Herman Miller also has seven showrooms in major metropolitan hubs throughout the country, ranging from a 6,000-s.f. space in New York City, to an 18,000-s.f. space in Los Angeles, featuring an extensive assortment of office and home furnishings.
Arhaus is also taking advantage of the changed COVID-19 landscape by opening a new smaller-format boutique store concept, called Arhaus Studio, which caters to high-end customers that are now living primarily in their second homes within resort-style communities away from urban hubs. The first such 4,202-s.f. store opened in October in Carmel-by-the-Sea, Calif., in the Carmel Plaza outdoor lifestyle center, which also houses a Tiffany & Co. and an Anthropologie.
The furniture brand is toying with opening approximately five to 10 new such units over the next one to two years. The ideal space should be between 4,000 and 4,500 s.f. in lifestyle centers within upscale vacation-home destinations. Both mountain areas and coastal areas will be desired, including the Martha’s Vineyard region in Massachusetts, Vail and Aspen, Colo., while Santa Barbara, Calif., the Hamptons, N.Y., and Naples, Fla., are also on the radar. The stores will offer furniture specific to the local area and provide a more intimate setting for furniture customization through 3-D room-planning software. The smaller format is a departure from usual Arhaus space that averages between 16,000 and 20,000 s.f. Arhaus continues to open approximately five to ten of its larger format stores per year as well, including its 15,000-s.f. standalone space at the Short Pump Town Center in Richmond, Va., relocated from a smaller space in the same mall in December. This unit takes over a former Circuit City building that will also house The Container Store set to open in spring of 2021. Arhaus also opened a 14,320-s.f. store in November at the International Plaza and Bay Street enclosed mall in Tampa, Fla.
