Macy's Closing Six Stores In Spring
Macy's Inc. reported to WWD that it will close six stores in the spring.
The three largest Macy's stores that will close are a 158,000-square-foot Paseo Colorado in Pasadena, Calif., a 362,000-square-foot store in downtown St. Paul, and a 791,000-square-foot store in downtown Houston.
"Of course it's a loss for downtown Houston," said Scott Wegman, vice president of brokerage at Cushman & Wakefield, Houston. "In terms of the overall impact, it's not significant. Macy's has a great presence in Houston at the Galleria Almeda Malls. It's probably disappointing to [Macy's] to lose that presence. They probably would have preferred not to close the store. Their customer is served at other places close to downtown."
Macy's is the only major department store left in downtown Houston. "The irony is the office market downtown is remarkably healthy," Wegman said. "The economy is good during the daytime."
Wegman believes the owner of the Macy's building will probably redevelop the site to have a supporting retail aspect, but take the opportunity to create something new.
"Like any big department store, Macy's doesn't pay much rent," said Andrew Graiser, co-president, A&G Realty Partners LLC, which purchases, evaluates, restructures and disposes of real estate and mitigates leases. "The property becomes an incredibly good real estate redevelopment, which could be mixed use with retail and residential, office or medical.
"[Downtown] is still a place where people go shopping," Graiser said. "There are still a lot of retailers out there looking to grow. Some local retailers might be perfect for the space. That's not to say that a company like Dillard's or Target wouldn't want a good chunk of the box. We saw what Target did in Canada with Zeller's." Target in 2011 acquired 189 Zeller's leases.
The Macy's closure in St. Paul will have "a great impact on the neighborhood. That shopping district has been declining and Macy's closure will be the nail in the coffin. The trend has been for shopping to move toward the suburbs. Minneapolis has been able to hang on to some retailers, but Saks Fifth Avenue's Off Fifth Outlet downtown is closing."
Macy's owns the five-story structure in St. Paul, which originally opened as a Dayton's unit in 1963.
Macy's is also closing a 99,000-square-foot Bloomingdale's home store at the Fashion Show Mall in Las Vegas, and two more Macy's units: a 75,000-square-foot one in Belmont, Mass., and an 80,000-square-foot store in downtown Honolulu.
But 2013 and 2014 will see some openings for the department store including: the Mall of Victor Valley in Victorville, Calif.; Gurnee Mills in Gurnee, Ill.; the Mall at Bay Plaza in the Bronx; University Town Center in Sarasota, Fla., and in Las Vegas, at the Shops at Summerlin and the addition of a men's store at the Fashion Show Mall. A 200,000-square-foot Macy's unit is being built at Westfield South Shore in Bay Shore, N.Y., to replace an older store in the same center. Meanwhile, Bloomingdale's stores will be built at Glendale Galleria in Glendale, Calif., Stanford Shopping Center in Palo Alto, Calif., and a Bloomingdale's Outlet unit at Fashion Outlets Chicago in Rosemont, Ill.
Macy's also revealed the consolidation of two stores at Ridgedale Center in Minnetonka, Minn., into an expanded store with 286,000 square feet in 2014.