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The 121,00-square-foot Georgia Square in Athens will close at the end of 2017. It has 69 employees.
The closings across the nation are part of the chain’s “actions to streamline its store portfolio, intensify cost efficiency efforts and execute its real estate strategy.” It also will save Macy’s $550 million annually starting this year. That will let the company invest an additional $250 million in growing its digital business, store-related growth strategies, Bluemercury, Macy’s Backstage and China.
“Over the past year, we have been focused and disciplined about making strategic decisions to position us to gain market share and return to growth over time.” Macy’s Chairman and CEO Terry J. Lundgren said, in a statement. “While we are pleased with the strong performance of our highly developed online business, as well as the progress we have made on selling and visual presentation programs and expense reduction initiatives in 2016, we continue to experience declining traffic in our stores where the majority of our business is still transacted. Given the overall trends challenging us and the broader retail industry, and the time needed to execute new strategies, we expect our 2017 change in comparable sales to be relatively consistent with our November/December sales trend.”
Newsboy, I read the Sky City article months ago. I knew that closing EVERY Macy's south of I-20 was NOT going to happen:
1. Would Macy's really leave two million people in a market where they are already heavily leveraged in advertising without a store?
2. Why would Southlake Macy's even be on his list to start with with its large sales volume and being one of the top sellers of designer handbags in the entire chain.
3. He had listed EVERY "one in a market" store, Macon, Columbus, Savannah, on the closing list but only Athens, another "one and only" is slated for closure.
Clayton White Guy:
I'm apart of the SkyCity Facebook page and I strongly disagreed with a lot of the store closures locations that was on that list. As a matter of fact, I took a lot of what you have said along with other "insiders" and those close to Macy's Inc. and posted several rebuttals.
Granted, Macy's has yet to announce the other 32 remaining locations...it's still a testament that only ONE store in the Atlanta region is closing down. Right now, the biggest question is whether the company intends to shut down South DeKalb, Greenbriar, Southlake, Stonecrest, or Arbor Place.
I wouldn't be surprised in the one in Disgusta closed too.
???
There is only one Macy's in Augusta that I am aware of. That market has over half a million people, half of which is fairly affluent. It captures a larger rural area that will shop there too being further away from Atlanta and other larger cities.
Athens is a much smaller market, is much less affluent, and is only a 45 minute to an hour drive from the Mall of Georgia. I know it was common for many students to drive to the Mall of Georgia for major shopping when I was in Athens.
To make matters worse, much of the affluence of that city is to the west lowering the drive time towards Gwinnett.
I'd say Macy's in Augusta is more than pretty safe.
What might happen longer into the future is a new higher-end mall development pop's up and a new Macy's comes in and the old one leaves. Some retailers might leave the market, but not all. Augusta might not always have a Sears, JCPenney, and Macy's, etc....
Belk and/or Kohl's could build more stores generating more competition using smaller cheaper properties.
But I think that would affect JCPenney or Sears first. If Augusta, overall, loses a bit of wealth and median wages drop Dillard's would become more at-risk first. Macy's in that scenario would benefit from that and be a stronger store to bet on. If Dillard's loses sales and leaves, Macy's will only gain the remaining more affluent shoppers.
Macy's is doing better than Sears, which has gone after a cheaper market and banked more on tool sales and appliances. The problem Sears has is more people are going to large big box home improvement stores for home appliances and Kohl's, Belk, and Marshalls for clothing. Macy's being in a upper-middle niche has been slightly more insulated than their competitors.
I think the single Macy's in each of Georgia's second-tier cities (market areas near or over half a million) are safe. I'm not sure I can say the same thing for Sear's.
Newsboy, of the four stores that you mentioned, I would put South Dekalb as being the most in jeopardy for one simple reason: Stonecrest was built several miles east several years ago as "the replacement South Dekalb" yet South Dekalb still is open (even surviving another legacy Rich's, the much more popular North Dekalb store) Greenbriar seems safer to stay open than South Dekalb, too. The folks in Southwest Atlanta have ALWAYS supported their Rich's (now Macy's) and the mall itself seems to be almost completely leased (kind of like Southlake, maybe not with the stores you want, but vibrant and not Gwinnett Place-ish Ghost town. In fact, with the overall abandoned feel of Gwinnett Place, I would expect THAT to be the store they would close in Metro Atlanta, especially with their larger Mall of Georgia store up in the northern excesses of that same county.
Newsboy, I read the Sky City article months ago. I knew that closing EVERY Macy's south of I-20 was NOT going to happen:
1. Would Macy's really leave two million people in a market where they are already heavily leveraged in advertising without a store?
2. Why would Southlake Macy's even be on his list to start with with its large sales volume and being one of the top sellers of designer handbags in the entire chain.
3. He had listed EVERY "one in a market" store, Macon, Columbus, Savannah, on the closing list but only Athens, another "one and only" is slated for closure.
I fully agree with you.
South Metro Atlanta is clearly less affluent and has clearly seen less growth, but when you have populations this high people still need places to shop. It also doesn't mean there aren't affluent people, just fewer relative to the whole population.
It just means you have less retail square footage per person, a store will push different lines of clothing more than another in a richer area, and/or there are fewer stores.
It seems to me that Macy's in South Atlanta is not overbuilt. There are really only 2, with 2 more @ I-20 being somewhat close by.
There is no way they'd all close.
The weaker one to me would be South Dekalb as Stonecrest is a really nice mall and sucks away some of the retail market from South Dekalb.
Greenbriar could be lost over time. The thing here is I think that is more likely to happen if Macy's ever strategically plans to open a new store to the southwest of the city, closer to Newnan and Peacthree City.... something to compete with JCPenney and Dillard's. With Union Station Mall's past closing and the popularity of Ashley Park, I'm not sure if there is room for Macy's to enter that market in the near-term. If Ashley Park was closer to the city and in between, it might could sustain more major retailers. I don't think that market area is large enough.... yet. Having a Belk, JCPenny, and Dillard's already pretty big for that small area.
In north Atlanta, Gwinnett Place is the most shakey, but Macy's has been the one thing about Gwinnett Place that has still been fairly well used. That market area exceeds a million people and has two Macy's. The market can support it, but with Simon's selling the Gwinnett Place Macy's is no longer getting a benefit from being a part of a small vs. a self-standing store. It signals a lack of investment in that mall in the short-term. It is essentially a holding company that owns it, until the area rebounds that sell it to someone who will put money into.
I can see them trying to maintain a place in such a large market. I'm also more nervous about the Sears closing there. If that happens, it will give Macy's a slightly more customers to survive with and wait on that mall area to rebound. I can also see them closing it, in hopes some customers will turn to Northlake and make it last longer.
Northlake is interesting. It has a small community following, but probably not quite enough to support it alone in the long-run and it is an aging following. If the map could magically be re-drawn, I think Macy's would wish they had 1 store already built half way between Gwinnett Place and Northlake and not at both locations.
Northlake Mall sits within a stable upper middle class community. If anything many parts of it (Oak Grove Road area) are becoming even more affluent and desirable. Those demographics would definitely be Northlake Mall's greatest strength. Proximity to more upscale Perimeter and way more upscale Lenox Square/ Phipps Plaza is Northlake's greatest problem. Many in the community seem to rather just go to those "tonier" destinations. That said, with their former tenant mix (Penny's, Kohl's, middle of the road Macy's and Sear's) seemed like a mid-range alternative (everybody needs reasonably priced kids clothes and housewares) until Kohl's pulled out last year. (They do still have the BEST J. C. Penny's in Metro Atlanta and a huge Sear's with an extensive Lands End department.) In real life, families with small children really have a more of a need for a Northlake type shopping center than a Phipps Plaza. I think that is the demographic that Northlake should shoot for, they can't really hope to compete with one of the top upscale destinations in the South, so try to be the mid-range alternative! By the way, speaking to the idea that having a Macy's half way inbetween Northlake and Gwinnett Place would be ideal, that would stick it on the declining eastern edge of Norcross, definitely downscale from Northlake's present community. Perhaps further west toward Peachtree Corners (Macy's at the Forum?!) to compete with Belk, LOL. I guess my feeling is that Northlake is still a safer bet to survive over MUCH MORE dismal Gwinnett Place.
Well, the problem is that pocket of upper middle class wealth you're referring to is definitely helping prop up Northlake, but it is still too small and it is competing for Lenox. Lenox still has a better lineup of shops and a large Macy's. The -whole area- around Northlake isn't stable upper middle class, 'nor is it around Gwinnett Place.
There is actually a great deal of wealth around Gwinnett Place too. The problem is it just isn't in that first 5 minutes off of I-85, but it is in every other direction around it past that and in Lilburn, Duluth, Peacthree Corners, and part of Lawrenceville. All roads in Gwinnett still lead to Gwinnett Place Mall.
The problem Macy's and large department stores at GCP are having is the small mall shops haven't entirely left the county. They moved to the Forum and Shoppes @ Webb Gin. Macy's can't follow that strategy, they need a larger market area. Belk is a smaller operation and was more readily able to split to two separate, but cheaper to operate stores. The Macy's in Gwinnett is also a very large store with lots of offerings, thanks to an inherited strategy from Rich's. I'm not sure how that will factor into any future decisions.
I know I drive to Gwinnett Place for Macy's over Northlake, despite being closer to Northlake, and I never step foot into the interior of the mall anymore. I think that only affects people in Lilburn and parts of Peacthree Corners.
Ashley Park in Newnan got a way with pulling in large department stores, since nothing else is down there and it is centrally located. The problem is the forum and the Shoppes aren't. This is what the interior of Gwinnett Place fell apart so quickly, while Sears and Macy's have actually held on for a very long time. Some stores needed a large retail market, while others could go into a smaller market (with less competition). The problem is it ruins any synergy advantage to attracting people to mall. The wealth in Gwinnett is there, but they will stay away from the I-85 corridor when they can and Macy's is stuck trying to be centrally located. If they go to the forum, they will lose more than half their market, if they go to the Shoppes they will lose close to half their market. Of course all of this is figurative. I'm pretty sure all markets are weak enough, it wouldn't pay for the cost of financing a new store. This is why I think they are stuck trying to keep 2 stores open in an area that could overall survive with 1 in a better location.
Northlake is far from perfect. Many of the interior shop's are lower end and Macy's doesn't get a full synergy either.
Just to put this in a larger perspective. Gwinnett has more people living in the county and a higher median income household. The wealth to support two large Macy's is there.
Dekalb has fewer people, lower median household income, 4 Macy's in its borders (1 of which is on the border with Fulton, and a 5th just inside Fulton near the Dekalb border. So let's just average that off to 4.
Yet, the Northwestern and Northern corridors of Metro Atlanta only have 2 and the northeastern corridor awkwardly has 3. Lenox being in the split of all corridors and in the center of the highest wealth.
That is strategically the position problem of old stores Macy's has in the region.
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