Macy’s will be hiring a specialist to advise the company on how to deal with its real estate portfolio, particularly in negotiations with developers. The move comes as the department store chain faces pressure from investors amid mounting losses.
According to reports in the Cincinnati Business Journal, Macy’s is looking into joint ventures that will take on some of the management of their flagship stand-alone properties, as well as their mall-based stores.
The retailer’s Chief Financial Officer Karen Hoguet has previously confirmed that the company was seeing “a high degree of interest” among parties in those joint ventures.
This confirms what CEO Terry Lundgren noted last week at the Consumer and Retail Tech Conference in New York on March 15.
“The line of people at our door who are attracted to that job has been very impressive.”
The hire will soon be announced and, according to Macy’s CEO, will represent a shift in how Macy’s considers its asset value.
“We will always be a retailer first,” Lundgren said. “This will be another set of expertise that will add value to us as a retailer.”
Starboard Value, an activist investor who has recently taken up a bigger position on Macy’s board, has been pushing for greater leverage of Macy’s Inc.’s real estate asset portfolio, which they estimate is worth about $21 billion.
Starboard’s original desire was to see that real estate spun off into a separate business entity — a suggestion Macy’s has declined to move forward with.