Store Closures Tsunami About To Hit, Eclipse Retail Carnage of 2017

[appalachiablue]

Business Insider, Jan. 3, 2018
Retailers are bracing for a fresh wave of store closures in 2018 that's expected to eclipse the rash of closures that rocked the industry last year. "Landlords are panicking," said Larry Perkins, CEO and founder of the advisory firm SierraConstellation Partners. "The last year was pretty apocalyptic from a retail standpoint, and the macro issues haven't changed. There will continue to be a high degree of bankruptcies and store closures."

2017 was a record year for both store closures and retail bankruptcies. Dozens of retailers including Macy's, Sears, and JCPenney shuttered an estimated total of 9,000 stores — far exceeding recessionary levels — and 50 chains filed for bankruptcy over the course of the year. But there's still a glut of retail space in the US, and the fallout is far from over.

The number of store closures in the US is expected to jump at least 33% to more than 12,000 in 2018, and another 25 major retailers could file for bankruptcy next year, according to estimates by the commercial real estate firm Cushman & Wakefield. Nearly two dozen major chains including Walgreens, Gap, and Gymboree have already announced plans to close more than 3,600 stores next year.

Many more announcements on closures and bankruptcies are expected in the coming months. The start of the year is a popular time to announce store closures and bankruptcies because retailers are typically flush with cash after the busy holiday season — and closing stores and filing for bankruptcy are costly. Among the companies most likely to file for bankruptcy within the next year are Sears, The Bon-Ton Stores, Bebe Stores, Destination Maternity Corp., and Stein Mart, according to S&P Global Market Intelligence.
Mass store closures will force shopping malls out of business..Continued,

https://www.msn.com/en-us/money/companies/a-tsunami-of-store-closures-is-about-to-hit-the-us-%e2%80%94-and-its-expected-to-eclipse-the-retail-carnage-of-2017/ar-BBHJnok?li=BBnb4R7

[snooper2]

1. wish I had the money to buy some closed down malls

I'm thinking massive paint ball landscapes-

Go-kart tracks racing all over multiple floors...

Ice cream shops and food shops all over...

rock walls to climb, bungee cords, blow a bunch of walls out of old stores. Could a badass location to make money with all the monster retail stores gone.'

And water park features, slides, hot tubs...and craft beer shops.

[Jeroen]

3. I forsee AR gaming in spaces like this n/t

[crazycatlady]

4. A mall in NY

Indoor racing track (go karts)
Escape room
Suspension bridge
Ferris Wheel


(Pallasades Center, West Nyack, NY)

[appalachiablue]

14. Sounds interesting, hope it's doing well.

[crazycatlady]

15. I rarely go there anymore

If I am, it is en route to/from my parents' house and normally to drop something off (H&M takes ratty clothes for recycling and they'll often give me a bag).

I actually used to work there in 03-04 when it was busier.

At the time it was built, it was the 2nd largest mall in the country. Teenage me's dream.

[Freddie]

5. Check out the Dead Malls series on YouTube

Fascinating stuff, and very sad. One of them is Coventry Mall in Pottstown PA. Used to take my son clothes shopping there when he was little, we’d shop at Boscov’s and then walk around the mall and get a snack at Friendly’s. Boscov’s is still there but the rest of the mall is virtually a ghost town now, Friendly’s is boarded up, Sears is gone.

[appalachiablue]

30. Thanks, will do. Maybe have a beer before watching though! It is sad..

Since 1980 and Reagan, 60,000 Malls were built in the US, I've read. Huge era of excess consumerism, and now major pull back. Quite a time of transition. La vie.

[ret5hd]

31. Beer Paintball and Go-Karts??? Man, I'm there!!!

[Doremus]

36. Our local eyesore was once the largest mall in America

Vacant for years and years, it was recently bought and torn down by Amazon. They're building a new distribution center.

The rat-infested eyesore highrise hotel adjacent to the once largest mall has also been sold to a developer hoping to rent strip center space to restaurants and other businesses catering to the employees at the new Amazon warehouse.

I wonder if future residents will be cussing out the derelict Amazon eyesores in their backyards decades from now.

[PoliticAverse]

2. Surprised Sears/Kmart have lasted this long. n/t

[Doremus]

37. Hard to kill off a 100-plus year old iconic American brand

but somebody had to do it. Who better than a sociopathic money grubbing hedge fund manager.

[Hugin]

6. Cute.

The photograph of the mall pictured is the same mall from the "Left 4 Dead" video game...

I wonder if Pedo Roy ever went there?

[Hugin]

7. I can't believe I recognized it... Sad.

Well, it's all over. I've seen the whole Internet thingie.

[Wounded Bear]

22. You hit this page?

[PoliticAverse]

10. Ha ha. Nah, it's a little different than the one in L4D2. n/t

[brush]

8. Recession is next, whenever repugs get in office a recession or even depression soon follows.

[LisaM]

9. I find this depressing. I enjoy shopping.

I remember the end of the 1990s as a kind of dream shopping period - right before everyone started going online. I know shopping's not everyone's favorite thing, but I've always enjoyed it.

I also have wide shoulders for my height, and I absolutely have to try on clothes to make sure they fit. Online shopping doesn't work for me, I find it an incredible hassle to send things back. I'd much rather put them on a hanger and put them back on the rack.

Ugh.

[Proud Liberal Dem]

11. I agree

I prefer to be able to try on clothing and be able to "window shop" before buying stuff. I buy very little clothing online, except for maybe some items like geeky/niche T-shirts.

[Blue_true]

24. I expect Amazon to come up with a issue that you have with online shopping soon.

Possible solutions are for you to fit yourself online or go to a brick and mortal Anazon shop to be fitted and order.

I was resistant to shopping online, but over time found that I could find things online that I could not get from a mall or local shop.

[LisaM]

29. Maybe, but I also enjoy human interaction.

I worked in a store for nine years and I really, really enjoyed it.

I live in an apartment now, which rents to a fair number of wealthy foreign students. The other day, two of them were opening boxes of stuff in the elevator that they'd ordered from Sephora. The irony didn't escape me that we can walk, from where we live, to a Sephora - in under ten minutes. And by doing that they'd be helping with local jobs, help keep a business open in our mall, and get some exercise to boot! (And probably pay less, because they wouldn't be paying for shipping).

I'd like to say I get it, but I really, really don't.

[Blue_true]

42. I tend to online shop, but respect your viewpoint.

I try to buy all US made products (way before the fake Trump came along), buying online allow me to buy U S made.

[appalachiablue]

44. I saw a brief story just a while ago how Nordy's will have places

to try on clothes that you can order through Amazon, some kind of arrangement. That's about all I remember and I don't know if and how much this plan has been implemented.

It reminded me of the few remaining older, small upscale stores--esp. bridal and evening clothing that I saw once when quite young. Places that focused on personalized service, staffed with clerks selectively bringing out items from the back. A very slow process I thought at the time.

Large 'department stores' grew in the late 19th, early 20th c. and changed the shopping experience esp. in large, metropolitan areas. (Mr.) Selfridges PBS series focused on the well known London department store which copied Chicago by openly displaying items in attractive glass cases and setting up elaborate store displays to attract wider customer interest.

It was a real contrast to earlier practices of storing merchandise behind counters, in back rooms and bringing out things to show customers individually. The new set up allowed customers (w/o an appointment) to walk around, handle and buy merchandise more freely, and continues today. Or did.

[Oneironaut]

12. Im surprised it didnt happen last year. Its inevitable, imo.

Many of the big retailers are hanging on by a thread. The internet is killing them. Also, the market is due for a correction.

Regardless of who won in 2016, it probably would have happened anyways. The problem is, I’m worried about Trump’s reaction if we fall into a recession. He may overreact and make things several times worse.

IMO, malls need to learn from movie theaters and focus on the experience of being there instead. It’s not just about the stores anymore.

[ProfessorGAC]

13. They'll Cut Taxes

That's their answer for everything, even though it doesn't work, except in extreme cases, the likes of which we have not seen in modern US history.

They've got nothing else. That's the problem with thinking that X therefore Y works in a system as complex as the organization called a giant country.

[Oneironaut]

16. Republicans seem to treat cutting taxes as a magical economic cure,

ignoring that there are times where cutting taxes would be a bad solution to the problem, imo.

[Wounded Bear]

23. When your only tool is a hammer, all your problems start to look like nails.

[appalachiablue]

46. True that. Now it seems we're in a period of the chainsaw approach unfortunately.

[ProfessorGAC]

33. It Would Be Impossible For You To Be More Correct (eom)

[Xolodno]

17. Store closures alone won't trigger a recession...

...but the domino effect that is caused by it will ultimately bring it forward.

Stores that depend on the others for foot traffic, such as pretzel shops will be hit next. No one is going all the way to the mall to buy a pretzel, frozen yogurt, slice of pizza, etc. They are there specifically to cater to the foot traffic that is shopping in the mall.

Shipping companies, warehouses, box companies, etc. will also get hit.

Unemployment insurance will stifle the blow of course, but, while unemployed, people dial back spending. Which then pretty much hits everyone.

[lagomorph777]

19. Shipping companies, warehouses, box companies, etc. will also get hit.

I think all but the warehouse companies will do better in the Internet world, not worse. The warehouse companies of course will be replaced by Amazon's warehouses.

[appalachiablue]

21. Very good points, esp. how suppliers in the chain of products will be hurt

and many unemployed people will reduce spending even more, and where else will they find work. Immense job losses.

When I read articles how departing stores in malls and shopping centers will be replaced by juice bars, fitness centers and health stores the skepticism is hard to suppress. Because these businesses' appeal is more limited, less profitable and unfeasible for most working people and families IMO.

The change does give people more time to spend at home, hopefully productively and with F & F, at public parks, etc. interesting and healthy activities.

[Xolodno]

40. It's definately going to vary from city to city....

...and what funds they have.

Where housing is a premium such as California, some are being torn down and replaced with more housing.

I can see some places where they convert or tear down the malls and become entertainment centers with limited niche shopping and/or parks.

But many cities essentially gave away the farm to developers in the hopes of more sales tax revenue. Sometimes that worked, other times it didn't. And where it did, not every city reinvested wisely.

[pandr32]

18. Time to fill them with real one-of-a-kind stores

...run by ordinary people with a business. We need to quit letting corporations like Simon Property Group and other Mall and strip mall developers write off empty spaces while they wait for lucrative franchises to move in.

Instead, we should offer incentives to lower their lease rates to small businesses...like boutiques, small galleries, gift shops, cafes, health food stores, etc. These types of businesses have been wiped out by corporate franchises, and these businesses serve and support the real middle class.

Malls are full of empty stores and the projected loss of full lease amounts is used as write-offs against more profitable locations.

[lagomorph777]

20. I would think a relatively small tax incentive to fill the space would work.

A writeoff is not really a substitute for rent money.

Also, what about retail to residential conversion? Some areas could really use reasonably priced housing, and millions of square feet of solidly constructed real estate in very convenient places might sell well.

[Wounded Bear]

26. That's part of the problem...

Businesses have been playing localities against each other to lower taxes as an incentive to go there, and municipal and local tax bases have been undermined all over.

Your ideas about re-use of dead retail space are intriguing. We have a huge homeless problem in the country.

[pandr32]

34. You are quite right.

Another advantage would be to enrich communities again. The "playing localities against each other" and other ways to lower taxes does not serve communities. They always claim they are creating jobs, but profits are taken out of communities and parked in safe places (like offshore). The jobs are pretty much all low wage anyway, and none of them provide job security,
Franchises predominantly fill malls and much of their profit is sucked away as well.

We all have subsidized these malls in the first place. Our tax dollars have paid for the infrastructure that connects them to us. We often lose green space or old neighborhoods to build these malls.

[pandr32]

32. I agree

We should reclaim the malls from corporate chain stores and turn them into community market areas--some residential space would be great. Interesting shops, businesses, eateries, daycare centers, and even public libraries in big box store spaces. Upper levels could be residential. Farmers' markets could fill the open middle areas on weekends.
The tax incentive is a good idea. Best idea is to provide an opportunity for people to afford to open a business again.

[appalachiablue]

45. Reclaim the Malls! The suggestions you mentioned are super.

[pandr32]

49. We should!

Not many realize but most of the malls are owned by a billionaire (of course) Herbert Simon. He heads up Simon Property Group which merged with Debartolo Reality in the 90s who was a rival. Simon spun off all the smaller malls in 2013 and they are overseen by Mark Orden of the Simon-owned Mills Corporation. The lists of properties and businesses involved are pretty overwhelming.
Clearly, none of it has anything to do with nurturing and serving actual communities.
"Reclaim the Malls!" Perfect slogan.

[lagomorph777]

47. +1 That sounds like a really appealing place to live, work, and shop.

Especially during a cold snap like this one!

[appalachiablue]

27. Sounds great, I'd really welcome that over corporate chains. Esp. more local,

regional emphasis and unique items that would be much more appealing.

Why travel to American places just to encounter more Targets, Kmarts, Vict. Secrets, Olive Gardens, Dominoes found everywhere.

[pandr32]

35. A repeating strip mall from one end of the country to the other.

Every town is the same as the one down the road.

Time to take back our communities and promote uniqueness and real opportunity again.

[lpbk2713]

25. Are we MAGA yet?

Someone please poke me in the ribs when we are there.

I don't want to miss it.

[dembotoz]

28. Maybe turn the mall Into ice deportation facilities

Limited entrances no windows for security, existing food court for kitchen. .it could work like a bad b movie

[Doremus]

38. Wonder how many are employed in those thousands of stores

Hate to think of it.

[appalachiablue]

39. My same concern. It's very serious, employment wise.

[Wounded Bear]

41. A serious problem...

Retail has been supporting an increasing percentage of low wage earners. Take away those jobs, and there isn't much out there for kids just starting out for others looking to support themselves.

[LisaM]

43. Retail jobs are getting hammered.

There's just an element of society - and they're winning - who don't care.

[Lurks Often]

48. Too many malls and online shopping

There are at least 4 indoor malls within 30 minutes of where I live, so they are competing for a diminishing customer base as more and more people switch to online shopping.

Online shopping means no crowds, no sullen employees, no rooting through the racks and shelves for your size. It also means getting what you want, usually at a lower price, delivered to your door.

I fully expect the downward spiral to continue and what is left will be the big box stores (Wal-Mart, Target, Home Depot & Lowes and the like) niche or specialty stores and a handful of regular retail stores for those who dislike online shopping.