Oregon Macy's closures round 2 (Portland, Salem: lease, neighborhoods, buying)

[pnwguy2]

The earlier announcement of the downtown Portland store is now added by a new list of closures today. Salem Lancaster Mall's Macy's is on the closure list. This in addition to the closure of Washington's Kelso Three Rivers Mall, which is also on the list. Apparently there are 32 more closure locations coming.

[Larry Caldwell]

Malls are on the way out. They are so last century. Macy's is overpriced and catered to the gift crowd. They depended on foot traffic and impulse buying. That business model just doesn't work any more.

[pnwguy2]

Agreed. However, they will remain in certain markets, and perhaps will become the new high-end mall store in the US, in addition to their brick and mortar stores in downtown markets. Why it didn't work out in Portland is beyond me, but they still will exist in downtown Seattle. I don't think this company is about to go out of business, but I do think they expanded too fast in the past couple of decades.

[annoyingcherry]

I'm really glad the Macy's at Salem Center was spared. The Salem Center mall seems to be in good shape. Would like to think the reason is because it's walkable to so many nice neighborhoods, but have no idea to be honest. A good mix of upscale and discount stores would be my next guess.

http://www.salemcenter.com/directory/

[pnwguy2]

Cool. That sounds like a nice development there. Not really familiar with it, but more power to downtown Salem! I do indeed think the future is in-city housing and shopping at a city core.

[oldtrader]

Macy's has been doing what it has been for many decades. It closes stores that are not profitable, and holds onto and opens stores where they will be profitable.

Old Retail Problem. Customers move their buying patterns from one area to another, and when they do there are stores and shopping centers that are no longer profitable. One reason they move their buying pattern, is a shopping center is in a declining neighborhood, or is worn out and needs a big rehab project done on it. Customers like new and flashy stores and neighborhoods to do their shopping, not old worn out ones. When the lease runs out on the store, they move to a new location where it will be much more profitable instead of sending a lot of money on a store that is no longer profitable. Or if the city is not profitable for them, move out of the city. A lot of stores in down town areas are being closed, and new ones have been opened in suburbs where their main customers live. Some downtown areas like Salem downtown are still viable, or profitable enough the stores will remain till their lease runs out and may be closed later.

Macy's and several other big retailers, have been and are closing low production stores, while they are still not money losers. One thing that happens when Macy's closes a store, the entire shopping center will see some of the quality stores in that center also close.

Too many stores, too much luxury: Macy's looks to rewrite retail

Retail stores have been consolidating, etc., for decades. Just an out look to better understand how it works.

http://investor.ggp.com/sites/ggp.in...esentation.pdf