James Traber’s shopping options are shrinking and that will only deepen Monday, when three Philadelphia-area JCPenney stores close for good.
“It’s sad. I’ve come here for years,” Traber said this week at the Penneys at Philadelphia Mills in the Northeast. “All the Kmarts in the area closed; all the Sears are closing; and now all the JCPenneys are closing.
“I’m running out of places to shop,” said the engineer, 41. “It seems the only thing that’s going to be left open is the Walmart.”
The other area Penneys stores to go dark at the close of business Monday are at King of Prussia and Willow Grove Park Malls. The three closures combined will affect about 5,000 positions.
Liquidation began April 17, and all three have been holding closeout sales of 80 percent to 90 percent off for the last few weeks.
All that was left at the Penneys at Philadelphia Mills this week were a few racks of men’s and women’s clothing, and some fixtures and furniture. What wasn’t for sale and likely heading for another Penneys was cordoned off by yellow tape.
“I do a lot of shopping online,” Traber said as he walked around. “I love it. It’s just that I want to take a look at the clothes and try them on before purchasing them, because they never look the way they do online.”
But it’s mainly online shopping that’s putting the department store out of business.
J.C. Penney Co. on March 17 identified 138 stores to close, part of a companywide downsizing to get rid of poor performers. In January, Macy’s Inc. made a similar move and targeted 68 stores to close in 2017 on top of the 39 it shuttered last year.
Sears Holdings Corp. has closed thousands of stores, and last month announced 17 more Sears and 49 additional Kmarts will close. Among them were a half-dozen Sears and Kmart stores in the region.
“It became apparent to us that our footprint was too large,” Penneys chief executive officer Marvin Ellison told investors during a February earnings call. He said the company would invest in its remaining stores.
Madeline Hurley, retail analyst at IBISWorld, said Penneys now has a 6.9 percent share of the shrinking department store market.
“Both JCPenney and the department store industry as a whole have struggled to compete amidst online competition and declining mall foot traffic,” she said. “Although the store closings do not mean it is the end for the company, it certainly does not bode well for JCPenney’s future.”
The Penneys at Philadelphia Mills occupies 6.3 percent of the space at the 1.6 million-square-foot mall on a lease that runs through February 2022.
Simon Property Group, which also owns King of Prussia Mall, invested $30 million in renovating the mall formerly known as Franklin Mills. The renovation was completed last year after Simon added outlet stores and restaurants to broaden its appeal.
Simon declined comment on its plans to replace the Penneys at both malls.
But losing a mall anchor “can ignite a downward spiral in revenue and sales,” wrote Steve Jellinek, vice president at Morningstar Credit Ratings LLC, in a March 22 analysis. “Customer traffic at the property may be substantially reduced.”
Willow Grove Park is owned by Pennsylvania Real Estate Investment Trust (PREIT). Spokeswoman Heather Crowell said PREIT was working on finding a replacement tenant for the Penneys store. She described Willow Grove as “one of the best performers in the company’s portfolio,” generating sales of $650 per square foot.
Still, Penneys loyalist Jason Rietheimer, 26, a home maintenance worker from Royersford, Montgomery County, was lamenting the loss of one of his favorite go-to stores for shirts.
“All the other stores were overpriced. I could get really nice Nike shirts for $10.99 to $15 each, and sometimes a two-for-$25 special here,” said Rietheimer at the KOP store on Thursday, leafing through the sparse men’s racks.
The entire second floor, once filled with appliances and electronics, was all but emptied out, while the first-floor entrance to the mall from inside the store was closed off.
The end, as the signs suggested, was just days away.