Wednesday, July 15, 2020

[UPDATE] JCPenney Arbor Place Gets New Lease on Life as Company Pulls Back on Planned Closures

Bankrupt retailer JCPenney (JCP) has eliminated several stores from a list of those it previously said would close  permanently.  At least one Atlanta area store has been given "a second lease on life," with store officials confirming to ToNeTo Atlanta that the JCPenney store at Arbor Place Mall in Douglasville will, in fact, not close.  In a June 4 release, JCP indicated it planned to close 154 stores as it works to "right size" its store fleet following its Chapter 11 bankruptcy filing.  The company subsequently added 13 more stores to its closure list but later removed others.      
The JCP at Arbor Place opened in 2003 in place of short-lived home improvement chain dekor, which itself took the place of Uptons.  Uptons, an Atlanta-based department store, was to have co-anchored the mall, but went bankrupt before the mall's 1999 debut. 

Arbor Place is today anchored by Belk, Dillard's, Macy's & JCPenney.  Former anchor Sears closed this past February.  

The six other Georgia JCPenney stores previously announced to be closing are still expected to do so and are currently liquidating all in-stock merchandise.  

JCPenney stores in Georgia that are still closing 

Northlake Mall - Tucker 
Georgia Square - Athens  
Lakeshore Mall - Gainesville  
Mount Berry Mall - Rome 
Statesboro Mall -  Statesboro  
Hatcher Point Mall - Waycross

The store at Arbor Place is among at least two JCPenneys that will remain open that are in CBL Properties-owned malls.  At least two other JCP stores now spared from closure are in malls owned by Namdar Realty Group.  

ToNeTo Atlanta, in partnership with our numerous and dedicated readers around the country, was able to confirm that the Arbor Place store was one of more than 20 stores that JCPenney intends to keep open.  The company said in a blog post that the stores that they have spared from closing  "remain on hold pending further review."

No reason was provided for the about face on the part of the retailer, but JCPenney Corporate Communications Director Dione Martin told the Pittsburgh Post-Gazette that the decision to keep its local store open was the result of  “comprehensive evaluations of our retail footprint and a careful analysis of store performance and future strategic fit for JCPenney.”

Several real estate sources tell ToNeTo Atlanta that co-tenancy clauses held by smaller stores within the affected properties likely played a role in the closure reversals at the affected malls and centers.  In many cases, smaller stores sign leases with so-called "co-tenancy clauses" which provide significant incentives and or opt-out options for smaller retailers if larger retailers [anchors] vacate their spaces.  JCP likely negotiated with CBL, Namdar and others to receive more favorable new lease terms (potentially free rent) to keep them in the malls, thereby preventing other smaller stores from invoking any co-tenancy clauses tied to JCPenney.  

Are you surprised that JCPenney is keeping so many stores open?  When was the last time you shopped at a JCPenney?  What would you like see open at Northlake Mall or any of the other soon to be former JCPenney "boxes" around the state?

Please share your thoughts below  

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