Westfield Garden State Plaza in Paramus,N.J., with 2.13 million square feet of gross leasable space, is one of the largest and most productive shopping centers in the U.S., anchored by Macy’s, Nordstrom, J.C. Penney, Neiman Marcus, Lord & Taylor and AMC Theatres. But, come March, Garden State Plaza will have one less anchor.
J.C. Penney is quietly closing its 183,000-square-foot store, after 60 years of anchoring the center.
“After recent lease discussions with the Garden State Plaza mall developer, the decision was made to close our J.C. Penney location,” a spokesman for the retailer said. “We expect the store to close approximately March 10. Store liquidation began on Jan. 25. The company is also closing seven other stores across the country, none of which are in New Jersey or New York.”
The other J.C. Penney units to be closed are in St. Louis; Galesburg, Ill.; Alexandria, Minn.; Bartlesville, Okla.; Burlington, Wash.; Calexico, Calif., and Mount Vernon, Ohio.
“Taking actions that directly impact our valued associates and loyal customers is difficult, but we will go to great lengths to relocate esteemed leaders, while assisting associates in identifying other job opportunities at nearby J.C. Penney stores, if possible,” the Penney’s spokesman said. “Eligible associates who do not remain with the company will receive separation benefits, including outplacement support and an on-site career training class.”
Best Buy had previously said it will be leaving Garden State Plaza in the spring. When one or more large tenants leave a shopping center, most developers see the events as opportunities to redevelop the space with uses that are more relevant to shoppers. A Westfield spokeswoman “confirmed that the company had acquired the space [from J.C. Penney] and is excited to redevelop it.”
J.C. Penney’s four-level, 150,000-square-foot flagship in the Manhattan Mall on Sixth Avenue and 32nd Street has been on the market since June when a spokeswoman said, “as part of a continuing effort to optimize our retail operations, Penney’s is pursuing a potential sublease agreement.”
The unit has reportedly been among the retailer’s top four or five volume-generating stores along with the Queens, Bronx and Puerto Rico units.
“Regarding our Manhattan location, the space continues to be marketed for a potential sublease agreement, but we don’t have anything further to share at this time,” the spokesman said Monday.
J.C. Penney began closing stores nationwide in 2014, when it said it would shutter 31 units across the country.
The retailer last year said it would close 138 more stores. The Paramus store closing on March 10 was not on the list released last year.
“My understanding is that the closure of J.C. Penney at Garden State Plaza has more to do with the mall’s redevelopment plans and was formerly owned real estate for J.C. Penney that Westfield acquired back from Penney’s as part of that project,” said Garrick Brown, director of retail research for the Americas at Cushman & Wakefield.
There are no U.S. locations that can compare to Manhattan in terms of foot traffic. “That’s why Manhattan rents are the highest overall of any U.S. trade area,” Brown said, adding, “If a location isn’t living up to expectations, even in Manhattan, it may be a candidate for closure.” Variables include whether a flagship location is central to a brand’s image or marketing campaign, however, “probably not so much in the case of J.C. Penney, but rather, in the case of a lesser-known brand. Regardless, we expect more strategic closures ahead. Whether Herald Square will be among those remains unknown,” he said.
Garden State Plaza is subject to Bergen County Blue Laws, which require stores to be closed on Sunday. It’s a testament to the shopping center’s strength that retailers say they do as well or better at Garden State Plaza than malls that are open seven days a week.
After opening in 1958 at the intersection of Routes 17 and 4, Westfield Garden State Plaza grew around J.C. Penney. The store was remodeled in 2012 and 2013; however, by that time, the mall had gone in a decidedly more upscale direction, with the addition of Nordstrom in 1990, and the 1996 arrival of Neiman Marcus and Lord & Taylor.