As the company moves to invest in internet operations to win over online shoppers, it’s exploring more opportunities to cash in on its real estate holdings.
“Macy’s, Inc. has been reviewing its real estate portfolio across the country to see if there are opportunities to improve the use of our assets,” Macy’s told the newswire.
Analysts and investors were told last November that the company would continue to explore opportunities with Brookfield Asset Management for approximately 50 properties, including the company’s flagship location in New York. To generate cash, the company has also struck deals with its landlords — such as General Growth Properties — to sell locations.
Following the news, the company’s shares tumbled 3.7 percent on Wednesday.
Macy’s is hardly alone in its decision to close some of its brick-and-mortar locations. Ailing specialty retailers like Toys R Us will be shuttering a large number of its retail businesses. H&M and JCPenney have also announced closure plans that will run throughout the year.
Physical stores trimmed their ranks by 7,000 last year — a 20-year high and a 229 percent increase year over year. Year to date, store closure announcements in the U.S. increased 229 percent year over year to some 6,985, according to a FGRT report emailed to Retail Dive.
Jan Kniffen, CEO of consulting firm J. Rogers Kniffen Worldwide Enterprises, said those troubling results — pushed by an expanding eCommerce segment — will give way to the next round of closures already announced for early 2018, with more to follow.
True to Kniffen’s analysis, Macy’s saw 33 straight quarters of double-digit online sales growth as of the third quarter of 2017. That digital torque should come as the company is spending more money on advertising its online conduits, while it also seeks to boost its search engine optimization processes.