West Babylon Dollar Tree to relocate across street to Great South Bay shopping center

National discount retailer Dollar Tree is relocating its West Babylon store to the Great South Bay shopping center, moving into the space formerly occupied by Party City.

Dollar Tree at 1000 Montauk Hwy. will be relocated across the street to 737 Montauk Hwy., according to Christa Minogue, real estate manager for the Chesapeake, Virginia-headquartered chain. 

“We are relocating into the former Party City space,” Minogue said. She did not have details on when the new or current stores would open or close. Minogue said employees at the existing Dollar Tree on Montauk Highway would keep their jobs and relocate to the new store once it's open.

Officials with Dollar Tree’s corporate office did not immediately respond to requests for comment.

Following the bankruptcy auction of Party City’s leases nationwide, Dollar Tree  acquired 148 leases held by the former party supply store, according to documents filed with the U.S. Bankruptcy Court for the Southern District of Texas in Houston.

“Dollar Tree is adding stores prudently, including picking up leases from firms like Party City in bankruptcy,” Dan Su, equity analyst at Morningstar, wrote in an email to Newsday.

Su said given the decline in customer foot traffic at brick-and-mortar retailers as more shoppers move online, prime retail locations are in high demand.

“I suppose Dollar Tree viewed the Party City locations that they bid for fit their selection criteria in terms of location and total floor space.”

Su added that while the chain has picked up a notable number of Party City leases, it's unlikely to go on a major expansion spree and is more focused on changing its store layouts to reflect their new "3.0" model. 

The new format for its stores reflects the company's move to a multi-price strategy that sells some items for as much as $7, a new price point the company announced early last year. In 2021, the company raised its base price point on most of its merchandise to $1.25.

After nearly 40 years in business, Party City announced plans to close all of its stores in December after filing for Chapter 11 Bankruptcy for the second time in less than two years.

Just prior to filing for bankruptcy protection and shuttering the business, the retailer of Halloween costumes and party supplies had 700 stores nationwide, including over a dozen locations on Long Island.

In January, Woodcliff Lake, New Jersey-based Party City announced that leases on its stores, including 13 on the Island, would be going up for auction in February.