Macy’s Will Close 150 Stores by 2027, Triggering Change in Malls and Communities
Macy’s decision to close nearly a third of its stores will spark change in malls and communities across the U.S.
The retailer said in late February that it plans to close about 150 of its namesake locations by early 2027. Macy’s has not yet shared which stores will shutter.
Downsizing Department Stores
Macy’s is trimming its locations as department stores and malls alike dwindle.
Macy’s has left many malls already. It has closed more than a third of its namesake stores over the last 10 years. As of early May, the company had 503 Macy’s stores, including a small number of other concepts outside of malls.
Other anchors have downsized or disappeared from malls, including Sear’s, Lord & Taylor and JCPenney.
Grocery Stores, Hockey Rinks and Amazon Warehouses
If history is a guide, former Macy’s stores will likely transform into spaces and spark projects that surprise longtime mallgoers.
Since 2012, major mall owner Brookfield Properties has redone more than 100 anchor boxes with capital investments of more than $2 billion.
At Tysons Galleria in the Washington, D.C. area, Brookfield used the closure of Macy’s as an opportunity to tack on a new wing. It opened in 2021 with broader entertainment offerings, including a bowling alley and movie theater; home furnishing stores including RH and Crate & Barrel; new dining options and a showroom for electric vehicle brand Lucid Motors.
What’s Next for Malls?
Macy’s closures will ultimately be a good thing for many malls and customers, said Chris Wimmer, senior director at Fitch Ratings who tracks real estate investment trusts.
He said owners are “itching to get their hands on their Macy’s” and free up prime real estate.
In those malls, which tend to have better locations and owners with stronger balance sheets, he said owners will “breathe new life and relevance into a shopping center.”
Concluding Thoughts
Macy’s closure will spark change in malls and communities across the U.S. As department stores and malls dwindle, mall owners will have an opportunity to rethink their strategy and create new, exciting spaces that draw in consumers.
FAQs
Q: Why is Macy’s closing 150 stores?
Answer: Macy’s is downsizing its locations as the growth of online shopping and demographic shifts mean some small towns or regions can no longer support a bustling shopping center.
Q: What will happen to the former Macy’s locations?
Answer: Some former Macy’s locations may be converted into smaller retail spaces or spark more significant changes, such as the addition of apartments or demolishing the mall for a completely new development.
Q: Will Macy’s closures lead to a loss of jobs?
Answer: Yes, Macy’s closures will likely lead to a loss of jobs, but the company is investing in its remaining locations and opening new locations for its better-performing brands.
Q: Can malls recover from the loss of anchors like Macy’s?
Answer: While the loss of an anchor like Macy’s can be significant, mall owners can repurpose the space and draw in new tenants and consumers with creative and innovative offerings.
