Macys Union Square closing

[storewanderer]

Is it real yet, San Francisco?

This is the most significant retail closure there yet. And this is a huge loss for Macys, that was a fantastic store.

Union Square is dead.

[J-Man]

That store has been there for almost 100 years. It opened as O'Connor Moffat in 1929. Macy's bought them out in 1945 and rebranded the store as Macy's in 1947.

[reymann]

the macy's closure is a big blow to san francisco. SF is about to be detroit 2.0 at this point, it's not a matter of if now but, when san francisco has to file for chapter 9 bankruptcy.

[arizonaguy]

Is it real yet, San Francisco?

This is the most significant retail closure there yet. And this is a huge loss for Macys, that was a fantastic store.

Union Square is dead.

It's kind of sad. When I lived in the Bay Area (and worked in downtown SF) from 2009 - 2010 that area was absolutely full of life. I can't tell you how many times I had Haagen Daas at the ice cream shop in the basement of that Macy's or enjoyed the holiday light display on Union Square.

This closure points to two problems:

1.) The absolute death of commercial real estate in San Francisco. Downtown San Francisco was full of tech and financial workers who used to work in office towers. Now, most of those employees are WFH employees as the tech companies have laid off employees and/or consolidated their office space to suburban office parks closer to San Jose.

2.) Macy's is terminally ill. This store was absolutely the #2 flagship store in the chain after Herald Square. It's an absolutely beautiful store that was one of the last truly great downtown Macy's stores. The chain might have been better off with the private equity liquidators ending the bleeding rather than plodding along to irrelevance. It was probably a bad sign when the Men's store closed a few years back but a healthy Macy's should've done everything in its power to keep this store open. Also interesting to note that the article says that the Macy's store will remain open until it finds a buyer for the property. It almost reads that Macy's is closing this store and selling it as a cash grab as this store sits on probably some of the most valuable real estate the company owns other than Herald Square. I'd be interested to see if State Street in Chicago (former Marshall Field's flagship) is also closed in a similar cash grab.

[ClownLoach]

Is it real yet, San Francisco?

This is the most significant retail closure there yet. And this is a huge loss for Macys, that was a fantastic store.

Union Square is dead.

It's kind of sad. When I lived in the Bay Area (and worked in downtown SF) from 2009 - 2010 that area was absolutely full of life. I can't tell you how many times I had Haagen Daas at the ice cream shop in the basement of that Macy's or enjoyed the holiday light display on Union Square.

This closure points to two problems:

2.) Macy's is terminally ill. This store was absolutely the #2 flagship store in the chain after Herald Square. It's an absolutely beautiful store that was one of the last truly great downtown Macy's stores. The chain might have been better off with the private equity liquidators ending the bleeding rather than plodding along to irrelevance. It was probably a bad sign when the Men's store closed a few years back but a healthy Macy's should've done everything in its power to keep this store open. Also interesting to note that the article says that the Macy's store will remain open until it finds a buyer for the property. It almost reads that Macy's is closing this store and selling it as a cash grab as this store sits on probably some of the most valuable real estate the company owns other than Herald Square. I'd be interested to see if State Street in Chicago (former Marshall Field's flagship) is also closed in a similar cash grab.

I think the message is crystal clear: the store has been in a free-fall from the top to the bottom of the company in sales. But that is not indicative of the company, rather the location. Maybe it was fantastic long ago, but not anymore. It is not Herald Square, it is Union Square and the gap between the two is like night and day. The company is not irrelevant, but San Francisco is now. They've made it clear that the stores facing closures are the worst in the company, collectively all 150 bring less than 10% of the sales. The company is not diseased, the location is. The tell should have been when the men's store closed, and Nordstrom closed. Obviously nobody there is delivering the sales anymore, which is not a Macy's problem. The closure list for the once mighty Union Square is a mile long and lists all the best and brightest in retail.

Furthermore, retaining these incredibly valuable assets paints a target on the company. If they don't sell it and reinvest the cash to fuel growth, then the activist raiders take over and sell it along with the few other legendary properties worth a fortune. They plunder all the proceeds and when they're done gutting the company then they will just call in the liquidators for the final insult.

Keeping this store means death to the company at the hands of others. Selling it sends a message to these vultures that they will not submit to them. Selling it means Macy's gets the benefit of their assets, not glorified thieves from these so called activist firms.

Macy's is not terminally ill. Quite the opposite, they are curing themselves of the threat of parasites in the form of so-called activist investors. They are healthy, they are strong, and they're not going to take any s___ off anyone who crosses their path. This is an aggressive statement from the new CEO, who we should remember just started work less than a month ago after turning around the Bloomingdales operation. He is here to keep Macy's here and relevant in the 21st century instead of just limping along until the vultures finally overwhelm the company and drag it to the underworld.

Macy's did the right thing here 100%.

[storewanderer]

I agree this is 100% a San Francisco issue this store is closing.

The men's store consolidation was disappointing and I guess was a sign of what was to come.

I'm sure the mayor hopes Macys will change its mind. I don't see that happening. It strikes me as an odd time to sell though. But selling is an interesting proposition to keep the vultures away.

It will be interesting to see what else announces closure in Union Square in the coming months. I expected traffic there to start recovering during 2024 but this closure really puts a dark cloud over things.

Also where will the new west coast flagship be? I assume somewhere in SoCal.

[ClownLoach]

I agree this is 100% a San Francisco issue this store is closing.

The men's store consolidation was disappointing and I guess was a sign of what was to come.

I'm sure the mayor hopes Macys will change its mind. I don't see that happening. It strikes me as an odd time to sell though. But selling is an interesting proposition to keep the vultures away.

It will be interesting to see what else announces closure in Union Square in the coming months. I expected traffic there to start recovering during 2024 but this closure really puts a dark cloud over things.

Also where will the new west coast flagship be? I assume somewhere in SoCal.

I say half San Francisco, half the activist bastards who are dead set on bleeding this company to death faster than you can say Eddie Lampert.

Letting this store go will save Herald Square, which allegedly is still their top store. If Herald Square goes then so does the company. They cannot afford to hold onto an asset like SF Union Square when it is worth more dead than alive, otherwise they will continue to attract these miserable bloodsucking activist firms who would gladly take control and then take all the sale proceeds and run. The Field's flagship is probably going to have to go too.

The de facto West Coast flagship is South Coast Plaza. Not exactly an architectural masterpiece, but a exceptionally well run and well cared for set of stores (men's and women's linked together internally via sky bridge, plus a huge home store across the street). They have the full assortment of product lines, and the Bloomingdales next door is the West Coast flagship.

[storewanderer]

I agree this is 100% a San Francisco issue this store is closing.

The men's store consolidation was disappointing and I guess was a sign of what was to come.

I'm sure the mayor hopes Macys will change its mind. I don't see that happening. It strikes me as an odd time to sell though. But selling is an interesting proposition to keep the vultures away.

It will be interesting to see what else announces closure in Union Square in the coming months. I expected traffic there to start recovering during 2024 but this closure really puts a dark cloud over things.

Also where will the new west coast flagship be? I assume somewhere in SoCal.

I say half San Francisco, half the activist bastards who are dead set on bleeding this company to death faster than you can say Eddie Lampert.

The de facto West Coast flagship is South Coast Plaza. Not exactly an architectural masterpiece, but a exceptionally well run and well cared for set of stores (men's and women's linked together internally via sky bridge, plus a huge home store across the street). They have the full assortment of product lines, and the Bloomingdales next door is the West Coast flagship.

Macys will always be the target of vultures due to the nature of the real estate. They have some great big city real estate.

Meanwhile Dillard's keeps chugging along. The real estate scattered around the middle of the US, is not of much interest to the vultures, yet. Negative comp sales. But earnings were okay. 3 store closures in 2023. One new store on 2024.

[HCal]

I am wondering if the Union Square store was basically a consolation prize to activist investors. It has been claimed that the Herald Square store, if sold, would be worth more than the entire company's valuation, so I'm sure there is tremendous pressure from certain investors to sell it. Perhaps selling this Union Square store is a way for the company to get those people off its back.

The clause about not closing until a buyer is found is rather interesting. Who exactly is going to be buying it? Probably not another retailer. With the decining commercial rents in San Francisco, I'm wondering if they may do a sale-leaseback and keep it open as long as the rent declines by enough to justify it. That seems more likely than someone wanting the space for non-retail use.

[ClownLoach]

I am wondering if the Union Square store was basically a consolation prize to activist investors. It has been claimed that the Herald Square store, if sold, would be worth more than the entire company's valuation, so I'm sure there is tremendous pressure from certain investors to sell it. Perhaps selling this Union Square store is a way for the company to get those people off its back.

The clause about not closing until a buyer is found is rather interesting. Who exactly is going to be buying it? Probably not another retailer. With the decining commercial rents in San Francisco, I'm wondering if they may do a sale-leaseback and keep it open as long as the rent declines by enough to justify it. That seems more likely than someone wanting the space for non-retail use.

Wouldn't call it a consolation prize because the vultures want the entire company so they can plunder those assets and then leave the rest to die. They want a fast buck. If Macy's sells these assets then they will lose interest as they don't want any part of an actual operating retailer, just their assets. They are just glorified looters. Macy's now has the money to spend on new stores and remodels that are desperately needed elsewhere. They won't sell Herald Square because it is still highly productive and profitable. A lease back would destroy the profits. The activists would have liquidators there within minutes of taking control of the company, even if such an action would put the entire organization at risk. They don't care about it, and would enjoy the added bonus of a fat tax write off for the paper loss of the company going out of business after they pushed it off a cliff.

Spending the money on new stores, small formats, Bloomingdales, and Bluemercury will improve the health of the company and get them growing again. Not all of those concepts work for me, but if they make money then more power to them. No reason for the vultures to win out and destroy this company.