Declining Sales, Low Profits Lead To Massive Retail Closures In 2017
The retail industry is already taking a major hit this year, with several retailers announcing massive closures and layoffs within the first few weeks of the year. The closures are leaving behind a glut of empty space that is exacerbating problems for developers and investors in the retail real estate game. Take a look at some of the biggest closures of 2017.
Store Closures: 250
Layoffs: 4,000
In a message posted on its website, The Limited announced it had closed all of its stores nationwide as of Sunday. That’s 250 locations and roughly 4,000 jobs lost. The women’s apparel chain will continue to operate online, bowing to the growing preference to e-commerce shopping. Increasing struggles in the women’s apparel and mall business led to the closings, and the retailer’s parent Sun Capital told Fortune the company’s remaining equity value is now zero.
Store Closures: 150
Layoffs: Unannounced
In a losing fight for sales, the retailer announced plans last week to unload an additional 108 Sears and 42 Kmart stores by early 2017, in addition to selling its Craftsman tool brand for $900M. Between the two brands, that’s roughly 2,000 shuttered stores within the past decade. The sale is also an effort to get Sears Holdings out of the red — the company reported a $748M deficit in December and needs to raise a whopping $1.5B in 2017 to continue operations. CEO Eddie Lampert was recently approved to loan the company $500M.
Store Closures: 65
Layoffs: 10,000
Following a disappointing holiday season, Macy’s announced it will close 65 stores this year, laying off some 10,000 employees. This is part of a plan Macy’s announced in August to cut 15% of its portfolio, or roughly 100 locations, by 2017 as a result of plummeting sales and a sizable drop in foot traffic. The retailer is being assisted by CBRE in offloading its stores.
Store Closures: 150
Layoffs: Unannounced
Finish Line, another mall-based retailer, announced last week it will close 150 locations over the course of four years. That’s nearly 25% of the athleisure chain’s 617-store portfolio. This move is yet another sign that the regional mall is struggling to maintain traffic that translates into sales for tenants.
