J.C. Penney to close 242 stores in bankruptcy restructuring

Coronavirus pandemic could be nail in retailer’s coffin

TRD NATIONAL /
May.May 18, 2020 05:00 PM
J.C. Penney CEO Jill Soltau (Credit: Justin Sullivan/Getty Images)

J.C. Penney CEO Jill Soltau (Credit: Justin Sullivan/Getty Images)

Department store J.C. Penney announced Monday it plans to close 242 stores across the country as part of its bankruptcy restructuring.

The 118-year-old company filed for bankruptcy Friday. The stores to be closed comprise about 30 percent of J.C. Penney locations and will leave it with just over 600 stores nationwide, according to the New York Times.

While the coronavirus pandemic and resulting retailer closures likely factored into J.C. Penney’s bankruptcy, the company was in a dire financial state long before. As of late April it was in discussion with its lenders for a debtor-in-possession loan of at least $800 million.

Bankruptcy filings show that J.C. Penney plans to close 192 stores this year and sell 50 stores that it owns next year, according to the Times. It plans to hold on to its best performing stores, which accounted for 82 percent of last year’s revenue. The company also aims to boost online sales from 14 percent of its revenue last year to a quarter of revenue by 2024.

April was a devastating month for U.S. retailers. Total sales, including online, fell 16.4 percent from the month prior as the vast majority of physical retail stores were closed all month. That was the largest drop on record, followed by the 8.3 percent drop in March.

Less money is moving up the financial food chain. In mid-April, some landlords had collected just 15 percent of their usual monthly rents and there’s concern that missed payments could lead to a wave of defaults.
[NYT] — Dennis Lynch

 

Related Articles

arrow_forward_ios
The process for challenging property assessments is so antiquated, officials won’t do Zoom meetings. (iStock)

“A recipe for disaster”: Fighting property taxes in a pandemic

“A recipe for disaster”: Fighting property taxes in a pandemic
Clockwise from left: Bronx housing court at 1118 Grand Concourse, Governor Andrew Cuomo, Judge Lawrence Marks, New York Supreme Court at 60 Centre Street (Getty; Google Maps; Wikipedia; New York State Courts)

Attorneys find ways to “eject” tenants without Housing Court

Attorneys find ways to “eject” tenants without Housing Court
Cadillac Fairview CEO John Sullivan and the RCB Centre in Toronto (Google)

This Canadian office giant has a strategy for a return to work

This Canadian office giant has a strategy for a return to work
Bars, restaurants and live entertainment venues around the world are now weighing their reopening options. Some owners say they can’t cover the cost of operating at reduced capacity. (Getty)

Facing the music: Entertainment venues, restaurants weigh reopening options

Facing the music: Entertainment venues, restaurants weigh reopening options
Anbang’s Andrew Miller, Mirae’s Peter Lee and (from left) JW Marriott Essex House, the Westin St. Francis in San Francisco and the Four Seasons in Jackson Hole (Credit: Marriott, Westin, Four Seasons)

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways
Softbank's Marcelo Claure, Masayoshi Son and Rajeev Misra (Getty; iStock)

Internal feud at SoftBank casts doubt on Vision Fund

Internal feud at SoftBank casts doubt on Vision Fund
Commercial real estate property sales fell to their lowest level in a decade as a result of the economic slowdown caused by the coronavirus pandemic. (Pixabay)

TRD Insights: Commercial deal volume plummeted 71% in April

TRD Insights: Commercial deal volume plummeted 71% in April
Bed Bath & Beyond is planning to reopen 600 U.S. stores as states begin to wind down shelter-in-place orders. (Getty)

Bed Bath & Beyond to reopen 600 US stores

Bed Bath & Beyond to reopen 600 US stores
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...