Virgin Megastore to Close All Remaining Stores This Summer

Virgin Megastores announced today that it will close all of its remaining famed megastores including New York City's Union Square Location at the end of May, and San Francisco's Market Street Location at the end of April and the rest this summmer. 

Since February 19, they will be putting all product on sale at liquidation prices as it begins the process of closing the Times Square location. All that remains of the once-formidable 24-store chain were three locations in Hollywood, Denver and Orlando, which will now close this summer.

Last June, a Vornado executive told Reuters that the store would shut down in the first quarter of 2009. The decision to close the store appears related to real estate and the value connected to the location. That executive was quoted as saying that Virgin pays only $54 per square-foot when the market rent in the area is about $700 a square foot.

The Times Square location does an estimated $55 million in annual volume, is profitable to the tune of $6 million, according to sources, and the space would be even more profitable for its owner with a higher rent tenant. Vornado bought the 180,000 square foot retail component of the Bertelsmann building, which houses the Times Square store, in 2006, and will lease the space to Century 21, according to various reports.