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Last week Starbucks (NASDAQ:SBUX) announced it would resume its expansion in 2011 opening 500+ stores, with roughly 400 outside of the U.S. Of course, China is a targeted area and many focused on that opportunity. On the other hand, that announcement means Starbucks will be opening 100 stores in the U.S.

And this brings me to my point - companies with solid balance sheets can afford to strategically expand and take advantage of the drop in commercial real estate. While many of us have heard innuendo and seen store fronts go out, a quick check with Moodys/REAL Commercial Property Price Index (CPPI) really tells the tale. Per the National Index that examines all properties, it appears we are back to late 2002 price levels and that looks to be the same if not similar for retail while office space has held up a tad better.

Pretty good timing for Starbucks and others that are in a financial position to renegotiate lease terms, making marginal stores profitable or increasing the profitability on already successful stores. Keep in mind, favorable lease renegotiations can result in a long-term reduction in overhead expenses as a percent of sales.

This was one of the key reasons why I recommended Big Lots (NYSE:BIG). I do think it will take time for the Street to catch on to this in terms of the incremental EPS impact. That to me is the opportunity with Big Lots and others, especially if the company also serves the cash strapped consumer the way Big Lots does.

Disclosure: No positions

Source: Real Estate Not a Problem for Companies With Solid Balance Sheets