Tuesday, June 30, 2020

What's next for bankrupt GNC?

Retail Dive
GNC is no stranger to economic turbulence. The retailer traces its history to the middle of the Great Depression, when, in 1935, David Shakarian opened a health food store in Pittsburgh. The store, Lackzoom, specialized in yogurt (still fairly new to the U.S. at the time) and other health foods.  . . . more

Gov. Cuomo: ‘Large’ malls in New York will need high-quality air systems to reopen

CSA
Malls in New York will need high-quality air systems that can filter out COVID-19 before they will be allowed to reopen.  . . . more

How CBL's journey to the brink lays bare the risks to malls

Retail Dive
On March 9, CBL & Associates Properties filed its annual report with the SEC that included a word that wasn't there the year before: "pandemic." . . . more

Monday, June 29, 2020

Microsoft closing all its retail stores — permanently

CSA

Microsoft Corp. is getting out of the retail brick-and-mortar business.

The software and cloud giant announced that, as part of a “new approach to retail,” it will permanently shutter all its Microsoft Store physical locations.  Four high-profile stores — Manhattan (Fifth Ave.), London (Oxford Circus), Sydney, Australia (Westfield Sydney) and Redmond, Washington — will be turned into "Microsoft Experience Centers" where  customers will be able to experience  product, see demos, explore device bars and learn about technology.  (All purchasing will be fulfilled via the company's digital storefronts, including Microsoft.com.) . . . more

Friday, June 26, 2020

Sephora launches on Instagram checkout with over 80 brands

Retail Dive
Sephora on Wednesday opened up on Instagram checkout through a digital storefront that allows shoppers to buy products directly from a user's Instagram feed or stories, according to a company press release emailed to Retail Dive.. . . more

More Kmart, Sears stores to close

Retail Dive
More Sears and Kmart stores are disappearing from the landscape. A spokesperson for Transform Holdco (also known as Transformco), which owns the remaining Sears and Kmart stores, declined to comment. . . . more

Mall landlords Brookfield, Simon and Authentic Brands in talks to buy J.C. Penney

Financial Post
The two largest mall landlords and Authentic Brands Group LLC are in talks to buy bankrupt department-store chain J.C. Penney Co., according to people familiar with the matter.. . . more

Thursday, June 25, 2020

NY retailer on malls not opening in Phase 4: ‘Devastating’

CSA
In a Tuesday news conference, New York State Budget Director Robert Mujica released preliminary information about the state’s Phase 4 re-openings next week. Mall retailers were not happy.. . . more

Macy’s to slash 3,900 corporate jobs in restructuring

CNBC
Macy’s announced Thursday it is cutting 3,900 corporate jobs — 3% of its total workforce — to reduce costs as it struggles with the effects of the coronavirus pandemic.

The department store chain said it expects to save about $365 million through the layoffs in fiscal 2020. It said it will save roughly $630 million on an annualized basis. . . . more

Wednesday, June 24, 2020

PREIT reports non-anchor occupancy at 85% across its re-opened malls

CSA
One of America’s biggest mall owners is back in business with a great majority of its tenants at their registers.

PREIT’S Capital City Mall in Harrisburg, Pa., and Dartmouth Mall in Providence, R.I., were both 85% occupied on re-opening days. PREIT was positive about traffic, too, noting that the Patrick Henry Mall in Newport News, Va., drew 99% as many visitors as it did in the same week last year. . . . more

GNC Files Bankruptcy to Manage Debt With Plan to Sell Itself

Financial Post
GNC Holdings Inc. filed for bankruptcy protection with the aim of selling itself and closing stores after its latest effort to manage its debt load unraveled amid the coronavirus pandemic.

The health and wellness company’s Chapter 11 petition filed in U.S. Bankruptcy Court in Delaware allows the retailer to keep operating and shut hundreds of under-performing stores. GNC planned a dual-track scenario where it will restructure its balance sheet through a standalone plan or sale of the company, according to a statement. . . . more

American Eagle launches new retail concept

CSA
American Eagle Outfitters has added another banner to its store portfolio. The apparel retailer has opened a new format, called Unsubscribed, in East Hampton, N.Y., reported WWD. . . . more

CBRE names new chief of U.S. retail real estate

CSA
John Morris, who had led CBRE’s service line for industrial and logistics real estate sectors, has had his role expanded to serve as leader for Americas Retail at the company. . . . more

Tuesday, June 23, 2020

Simon-Taubman deal hearing set for Wednesday

CSA
Taubman Centers’ fight to close its merger deal with Simon Property Group begins tomorrow, according to CNBC.

David Faber of Squawk on the Street said that Taubman’s court filing for an expedited hearing on Simon’s $3.6 billion offer will be heard in Michigan tomorrow. Taubman took that action fearing that Simon would “run out the clock” on the deal and walk away.. . . more

Shoe Carnival online sales skyrocket

CSA
Shoe Carnival is having a better than expected second quarter — at least so far.

The footwear retailer said it has experienced stronger than expected sales for its second quarter-to-date, with comparable-store sales up 28.1% versus the year-ago period. E-commerce comparable sales are up nearly 470%; while brick-and-mortar same sales are up 4.0%. . . more

Study: Overall spend continues to increase with small weekly gains

CSA
Consumers are opening their wallets for non-essential items.

That’s according to Cardlytics’ latest State of Spend Report, which is based on U.S. consumer spend. After non-essential spending dropped to a low of -75% year-over-year at the end of March, discretionary spend (in categories such as apparel) is climbing back up, down just -40.8% year-over-year the week of 5/28. . . . more

J.C. Penney details more store closings

CSA
J.C. Penney is getting ready to kick off its second phase of store closing sales as part of its store optimization strategy.

The department store retailer announced an additional 13 store closures (list at end of article), pending court approval. Store sales are expected to begin on or around July 3.. . . more

Monday, June 22, 2020

What's Behind the Lawsuits Against Eviction Bans

NREIOnline
Across the country, some landlord groups are scurrying to prepare legal challenges to pandemic-provoked eviction bans or already have gone to court. . . . more

Fast Casual BurgerFi Plans to Go Public Following Merger

QSR
In a rare restaurant development, an emerging fast casual is headed to the public sector. Opes Acquisition Corp., a blank-check company that uses public investor money to fund acquisitions, and BurgerFi International jointly announced Monday they’ve agreed to a non-binding letter of intent to enter into a business combination agreement. BurgerFi, which has nearly 125 corporate and franchise locations across 23 states and two countries, would become a publicly traded company on the NASDAQ stock exchange following close. Under the terms of the LOI, Opes and BurgerFi would become a combined entity, with BurgerFi’s shareholders rolling over a majority of the equity in the public company. . . . more

Nordstrom sets reopening date for NYC stores

CSA
Nordstrom is getting back to business in the Big Apple.

The department store retailer, which has been reopening its stores in phases nationwide, will reopen its six locations in New York City on Wednesday, June 24. The opening come two days after the city enters phase two of the reopening of its economy following the COVID-19 shutdown. . . . more

Thursday, June 18, 2020

J. Jill in forbearance on loans after ‘going concern’ warning

CSA
J. Jill Inc. has bought itself some time as it continues to struggle amid fallout from the COVID-19 pandemic.. . . more

Deloitte: Seven retail/CPG trends to watch

CSA
Digital sales growth is just one development during the COVID-19 pandemic that Deloitte expects will continue affecting retailers and CPG companies in the long term.

Deloitte's InSightsIQ, which actively monitors and aggregates a diverse set of real-time consumer, macro, marketplace, competitive and economic data sets, has identified seven trends that have emerged during COVID-19 which retailers and CPG companies should expect to be part of the “new normal.”. . . more

AT&T to Close 250 AT&T Mobility and Cricket Wireless Stores, Says Telecomm Union

SCB
AT&T has informed the telecommunications and IT union its plans to permanently shutter 250 AT&T Mobility and Cricket Wireless stores. The move would impact 1,300 retail jobs. There are currently more than 16,000 AT&T retail locations in the United States, including authorized retailers and company-owned stores and kiosks. CWA also reports that A&T plans to cut 3,400 technician and clerical jobs across the country over the next few weeks. . . . more

Stein Mart signals it might not survive pandemic

CSA
Stein Mart is the latest retailer to warn of “substantial” doubts about its ability to survive the COVID-19 pandemic.

The off-price retailer disclosed in a 10-K filing that its revenues, liquidity, cash flows, and ability to pay vendors and landlords have been materially adversely impacted as a result of store closures due to COVID-19. . . . more

Wednesday, June 17, 2020

Guess Is Permanently Closing 100 Stores as Its Leases Near Expiration

Footwearnews.com
Guess? Inc. is reevaluating its brick-and-mortar strategy as coronavirus-related shutdowns continue to impact its business.

The American apparel and accessories brand has revealed plans to permanently shutter about 100 stores in North America and China, or roughly 9% of its global network. The closures will take place over the next 18 months. . . . more

US retail sales up a record 17.7% in a partial rebound

ABCNews
U.S. retail sales jumped by a record 17.7% from April to May, with spending partially rebounding after the coronavirus had shut down businesses, flattened the economy and paralyzed consumers during the previous two months.The government’s report Tuesday showed that retail sales have retraced some of the record-setting month-to-month plunges of March (8.3%) and April (14.7%) as businesses have increasingly reopened. Still, the pandemic’s damage to retail sales remains severe, with purchases still down 6.1% from a year ago.. . . more

Clothing, furniture retailers drive May retail sales increase, still well below 2019 levels

CSA
Consumer spending rose dramatically from April as retailers closed by the coronavirus pandemic began to reopen, but was down year-over-year.

May sales rose 11% from April and 1.7% year-over-year, according to the National Retail Federation, which excludes automobile dealers, gasoline stations and restaurants in order to focus on core retail retail. . . . more

Target raises minimum wage to $15 per hour

CSA
Target is making good on a pledge it made some three years ago — and it’s doing so several months ahead of time.

The discounter is permanently raising its starting wage to $15 an hour, beginning on July 5. (In 2017, Target committed to hitting the metric by yearend 2020). The wage hike puts Target ahead of rival Walmart, whose starting wage is $11 an hour, and in line with Amazon. . . more

Francesca’s again warns of possible bankruptcy

CSA
Things are not looking good for Francesca’s. In a Securities and Exchange Commission filing, the accessories and apparel retailer warned that its liquidity has been adversely impacted by negative operating results due to the pandemic and “there is no assurance that we will have sufficient liquidity to continue operations.”

Francesca’s, which has 703 stores, had been struggling pre-pandemic with declining sales and profits for the past couple of years amid declining mall traffic. In early May, the company issued a “going concern” warning and floated the idea of bankruptcy
. . . more

Wednesday, June 10, 2020

Gap is closing its trendy men's athleticwear brand despite the continued boom in athleisure

Business Insider
Gap is closing its trendy athleticwear brand Hill City less than two years after it launched.

The apparel giant said in a blog post on Thursday that it made the decision to close this business in order to dedicate its resources to its larger brands – Gap, Banana Republic, and Old Navy.

Hill City launched in the fall of 2018 and was primed to swoop in and capitalize on the continued boom in athletic wear, outdoorsy clothing, and more recently, men taking more of an interest in shopping.. . . more

American Dream Leaves Clan Behind Mall Empire Mired in Debt

NREI
As brick-and-mortar shopping centers steadily lost market share to online competitors, the Ghermezian family behind three of the four biggest malls in North America built a thriving business by infusing their properties with heavy doses of entertainment -- a nod to the prevailing wisdom that younger people tend to prefer experiences to material goods.

Their company, Triple Five Group, offered attractions worthy of the best theme parks. In a 2016 interview with Bloomberg Businessweek, Don Ghermezian, who oversees the family’s American Dream mall in New Jersey, called the approach “internet-proof.”

They weren’t betting on a pandemic. . . . more

Signet Closing 380 Stores This Year as Sales Are Hit by COVID-19

JCK
Signet Jewelers won’t reopen 230 stores it closed due to COVID-19 and then plans to close another 150 stores this year, executives said in a conference call held Tuesday.

The stores that won’t reopen include 150 stores in North America and 80 stores in the United Kingdom.

These closures mean that Signet’s store footprint will have shrunk more than 20% over the past few years, chief executive officer Gina Drosos (pictured) said in a conference call following the release of its financial results. Most of the closures were in B- and C-rated malls, she said.. . . more

Tuesday, June 9, 2020

https://www.cnbc.com/2020/06/09/macys-shares-soar-company-says-reopened-stores-topping-expectations.html

CNBC
Macy’s shares soared Tuesday as the company released its preliminary financial results, saying it is regaining customers at reopened stores much quicker than it expected.

With the retailer’s stores forced shut for much of its fiscal first quarter due to the coronavirus pandemic, sales are expected to fall 45% to $3.02 billion from $5.5 billion a year ago, the company said. . . . more

25,000 stores are predicted to close in 2020, as the coronavirus pandemic accelerates industry upheaval

CNBC
One result of the coronavirus pandemic could be as many as 25,000 store closures announced by retailers this year, as the crisis takes a toll on many businesses, and already has pushed some over the brink and into bankruptcy.

U.S. retailers could announce between 20,000 and 25,000 closures in 2020, according to a tracking by Coresight Research, with 55% to 60% of those situated in America’s malls. That would also mark a new record — which was previously the more than 9,300 locations in 2019. . . . more

Monday, June 8, 2020

Sycamore Partners in early acquisition talks with J.C. Penney

Reuters
Sycamore Partners is exploring a possible acquisition of J.C. Penney, according to a Reuters report that cited anonymous sources. A J.C. Penney spokesperson declined to comment to Retail Dive on the report.

The private equity firm — which owns Belk and Talbots, among other retail companies — is in "preliminary" talks around Penney should the department store chain fail to reach a reorganization deal with lenders, according to Reuters.. . . more

J.C. Penney announces locations of 154 stores closing across the US

Today.com
J.C. Penney has announced the locations of 154 stores that will be closing across 38 states as it restructures after filing for bankruptcy last month.

The Texas-based retailer released a list of locations by state on Thursday, with going-out-business sales expected to begin on June 12 and lasting 10 to 16 weeks. . . . more

Thursday, June 4, 2020

Ascena brings on Kirkland & Ellis, others to advise on balance sheet

Retail Dive
Ascena Retail Group has brought on new advisers to "explore balance sheet alternatives," according to a Debtwire report that cited unnamed sources.

Among those advising the apparel retailer is law firm Kirkland & Ellis, which has worked on many high-profile retail bankruptcies over the years.

Also working with Ascena is Guggenheim Securities, which advised the retailer last year on the sale of a majority stake in the Maurices banner, and the consultancy Alvarez & Marsal.. . . more

Sears, Kmart stores are doing a slow fade

Chain Store Age
A look at what’s left of the Sears portfolio shows that the troubled retailer’s store footprint is doing a disappearing act.

According to a report by Forbes, there are a total of 161 Sears and Kmart stores left in the Transformco portfolio (Transformco is the privately held company run by Eddie Lampert that bought the remnants of Sears Holdings, including 400-plus stores, out of bankruptcy court last year). . . . more

Simon Property Group sues Gap for $66M in unpaid rent

The Real Deal
The gloves are off between the biggest mall operator in the country and one of its most important tenants.

Simon Property Group is suing Gap Inc. for its alleged “failure to pay more than $65.9 million in rent and other charges due,” according to a lawsuit filed Tuesday that was reviewed by The Real Deal.. . . more

Wednesday, June 3, 2020

Mall Owner CBL Skips Debt Payment, Hoards Cash While Rents Fall

NREI
CBL & Associates Properties Inc.’s years of effort to revive its business is being threatened by months of unpaid rents, forcing the mall owner to skip an upcoming interest payment while it negotiates with creditors.

CBL elected against making the $11.8 million coupon payment due June 1 on its 5.25% senior unsecured notes, which mature in 2023. The company drew $280 million in cash from its line of credit and furloughed employees while halting redevelopment investments designed to reverse the long-term challenges facing many American malls. . . . more

American Eagle Outfitters Loses $257 Million During Coronavirus Shutdown

Yahoo Finance
American Eagle Outfitters is reimagining its post-pandemic landscape. But for now, reminders of the coronavirus are everywhere.

For the three-month period ending May 2, revenues were $552 million, down from $886 million the same time last year. By brand, American Eagle suffered the most, with top-line sales falling 45 percent, following a 5 percent increase in 2019’s first quarter. Intimates brand Aerie decreased 2 percent, compared with a 28 percent jump the same time last year.

The company reported a loss of $257 million, compared with profits of more than $40 million last year. . . . more

Tuesday, June 2, 2020

Bankrupt Neiman Marcus breached its loan terms, lender says

Retail Dive
Deutsche Bank raised "concerns" last week that Neiman Marcus breached the terms of its asset-based credit line as it seeks a financing package to help it reorganize in bankruptcy.

According to the bank, which is an administrative agent on the retailer's ABL, an initial budget tied to Neiman's bankruptcy loan (know as "debtor-in-possession" financing) "contained material errors undermining key assumptions" that could impede the retailer's ability to repay its loan.. . . more

Monday, June 1, 2020

Brick and mortar's next chapter

Retail Dive
As the COVID-19 era has vividly demonstrated, closing stores has, at best, a chilling effect on shopping.

In April — a month when, unlike March or May, most if not all nonessential retailers closed down — retail sales as measured by the U.S. Commerce Department and tracked by Retail Dive plummeted 16%. Some segments fared quite a bit worse than that. Apparel sales plunged 89%, for example, while furniture and home sales fell 67%; electronics sales fell 65% and sporting goods and hobby sales fell 46%. General merchants, which in some cases were permitted to stay open thanks to sales of essential items, saw sales fall 14%, according to the government's monthly report.. . . more

How Are Mall REITs Trying to Survive?

NREI
Reacting to the coronavirus-initiated closures of their properties, mall REITs furloughed or laid off employees, slashed executive pay, chopped expenses and scrubbed development projects to staunch the financial bleeding. Yet those immediate measures won’t preserve the lifeblood of mall REITs as they open their doors again.

Rather, REIT executives are thinking outside the big box in their pursuit of long-term survival strategies. . . . more