A recent wave of store closure announcements will hit shopping malls across the U.S., leaving hundreds of storefronts empty.
Just this week, Victoria’s Secret said it will shut around 50 locations in 2019 — when it normally closes closer to a dozen each year; Gap said it’s closing 230 of its namesake brand’s stores over a two-year span; and J.C. Penney announced it plans to shut 18 department stores and nine of its furniture and home locations in 2019.
That builds on recent store closure announcements by Gymboree, Payless ShoeSource, Charlotte Russe and Ann Taylor parent company Ascena Retail, to name a few. A whopping 4,309 store closures were announced by retailers just in the first two months of this year, Coresight Research said in a research note on Friday. That’s well ahead of the number of announcements the market research firm was tracking this same time a year ago, it said.
Even Tesla this week said it plans to move all its sales online and close showrooms.
“If anything, this increases my concerns for the malls,” Jan Kniffen, CEO of consulting firm J. Rogers Kniffen Worldwide, told CNBC. There are roughly 1,200 malls in the U.S. and only 250 “great ones” that aren’t in trouble right now, he said. “I think we see more store closures in 2019 than in 2018 … This year is already ahead of last year.”
In 2018, Coresight tracked 5,524 store closure announcements in the U.S., which was down more than 30 percent from a record 8,139 closures announced in 2017.
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