TODAY'S PAPER
32° Good Morning
32° Good Morning
Business

Retail Roundup: Starbucks opens 4 stores; likes LI 'synergies,' broker says 

The coffee chain, which already has more than 100 locations here, finds area stores "very profitable,"  according to its exclusive broker on Long Island.

Starbucks, seen here in Plainview, reports earnings this

Starbucks, seen here in Plainview, reports earnings this week. Photo Credit: Barry Sloan

If you needed more chances to get your fix of Starbucks' pumpkin spice latte than existed at about 100 stores on Long Island as of last month, you're in luck.

During about the last three weeks, the world’s largest coffee chain opened four more area stores — new ones in Coram, Plainview and East Islip, and one relocated shop in Lynbrook, said Russel Helbling, a senior vice president at Garden City-based Sabre Real Estate Group, who is Starbucks’ exclusive broker on Long Island.

Also, in August, I told you that a Starbucks will open this winter in front of a Raymour & Flanigan furniture store on Broadhollow Road in East Farmingdale.

In fiscal 2018, which ended Sept. 30, Starbucks opened eight new stores on Long Island, including the relocation in Lynbrook and another relocation in Hewlett.

The chain’s local expansion is being fueled by the area’s demographics, Helbling said.

“Stores are very profitable on Long Island. It’s a great market. Good density. Good income. High traffic. Retail synergies,” he said.

Here’s the rundown on the new stores:

•    Plainview: The 1,800-square-foot Starbucks is at 1401 Old Country Rd. in Country Pointe Plainview, a new residential and retail development anchored by a ShopRite grocery store.

•    Coram: The 1,800-square-foot drive-thru at 1710 Rte. 112 is in a new multitenant building.

•    East Islip: The drive-thru Starbucks is in a former Chase Bank building, 2,950 square feet, at 2550 Sunrise Hwy., in a shopping center anchored by a Stop & Shop grocery store.

•    Lynbrook: The Starbucks relocated about a half a mile away — from Philips Plaza on Sunrise Highway to a new, free-standing drive-thru at 831 Sunrise Hwy.  The move was made because the previous store "was an old cafe that we wanted to move to a drive-thru location,” Helbling said.

Seattle-based Starbucks Corp. did not respond to requests for comment.

Since opening its first Long Island location in Great Neck in 1994, the chain has been getting around. 

There are now 48 in Nassau County and 54 in Suffolk County, according to the counties' health departments, which issue food establishment permits.

So, what's up with Starbucks beyond the Island?

With more than 28,000 stores globally, the company pulled in record revenue in its third quarter — an 11 percent increase to $6.3 billion — and had a net of 511 new stores, half of which were in Asia.

But it said in June that it would close 150 underperforming stores next year, about three times more than it usually closes annually.

Starbucks' sales growth at stores open at least a year has slowed because of the "saturation that they have in the coffee/breakfast daypart ," said David Henkes, advisory group senior principal at Technomic Inc., a Chicago-based restaurant industry research firm.

“One of the reasons they’re focused on building food and bringing things like sandwiches in are to expand the appeal of Starbucks, not only to grow the check average during breakfast, but also to position Starbucks for success in other dayparts,” he said.

“The closures are, I believe, more of a right-sizing in certain markets. Their overall growth trajectory is still heading higher, but it will be more challenging going forward,” he said.

Starbucks is being challenged because it needs to expand occasions for how customers use their restaurants, which are still very breakfast-oriented, while most of their quick-service competitors have some sort of coffee offering, he said.

Retail Roundup is a column about major retail news on Long Island — store openings, closings, expansions, acquisitions, etc. — that is published online and in the Monday paper. To read more of these columns, click here. If you have news to share, please send an email to Newsday reporter Tory N. Parrish at tory.parrish@newsday.com.

More news