Market Overview

Total Number Of Store Closures In 2017 To Break 2008's Record Of 6,200: Does This Even Matter?

Share:
Total Number Of Store Closures In 2017 To Break 2008's Record Of 6,200: Does This Even Matter?

Is retail in trouble? The answer certainly varies depending on who you ask and how they define retail. According to a Bloomberg report, there could be more than 8,000 store closures in 2017, which would surpass 2008's peak of around 6,200.

Most recently, Payless Inc. said it will close hundreds of stores, and teen-apparel retailer Rue21 could become retail's next casualty.

Bloomberg, citing data from CoStar Group, suggested that more than 10 percent of all retail space in the United States may need to be closed which amounts to nearly 1 billion square feet.

The Other Side Of The Story

The Bloomberg report quoted Oliver Chen, an analyst at Cowen, who said that Class A malls are thriving. In fact, his research shows that shoppers prefer physical stores 75 percent of the time.

And what about the thousands of store closures? Mall owners aren't necessarily worried and are happy to replace troubled department stores like Sears with gyms, movie theaters, "fast-fashion" chains and trendy restaurants.

There are more signs of optimism for retail investors.

Steven Tanger, the CEO of Tanger Factory Outlet Centers Inc. (NYSE: SKT), pointed out that his outlet store model remains as strong today as it has ever been.

Meanwhile, three of the most notable off-price retailers are opening 300 new stores, which matches the same number of stores Sears Holdings Corp (NASDAQ: SHLD), J C Penney Company Inc (NYSE: JCP) and Macy's Inc (NYSE: M) are closing.

Maybe retail isn't dead; rather, the only casualties are a handful of brands whose uniqueness and/or popularity peaked years ago.

Related Links:

Bed Bath & Beyond's Q4 Print Fails To Pull Back The Curtain On Margin Trajectory

Fund Manager: 50 Retailers Could Go Bankrupt This Year

 

Related Articles (JCP + M)

View Comments and Join the Discussion!

Posted-In: Bankruptcies Bloomberg CoStarNews Previews Events Media Trading Ideas Best of Benzinga

Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com