Macys’s Inc. said this week it will cut 125 department stores in the next three years – on top of numerous location closing in recent years.
Last Month, BoiseDev noted Macy’s continued decline in Idaho, after it announced the closure of its location in Lewiston.
The company said it would pivot from a mall-based strategy to other store formats, like smaller stores in lifestyle centers.
“We see a bifurcation of malls,” Macy’s CEO Jeff Genette said during an investor meeting, according to CNBC. “The lower-tier malls continue to decline rapidly.”
But Genette noted that the better malls – so-called “class A” and “class B” malls continue to see potential
“We see many malls that are thriving,” he said. “We believe the best malls have a real and growing place in U.S. retail.”
Macy’s only Treasure Valley store operates in Boise Towne Square. The mall, owned by Brookfield Properties, opened in 1988 with The Bon Marché as an anchor. The Bon – now Macy’s, is one of just two original anchors left at the mall (JCPenney the other).
Which of Genette’s tiers does Boise Towne Square sit in?
The upper, it appears.
Boise Towne Square: A-
Green Street Advisors is a real estate research firm. It studies – and grades – US malls. Boise Towne Square remains strong.
In a note to BoiseDev, a company representative said Boise Towne Square holds an “A-” classification. That’s the highest rated mall in the state. The A- grade means a mall features a “mix of high-end and national tenants.”
Green Street also notes that A- malls have stable occupancy and “suitable” tenant demand.
Macy’s continues to make investments in its Boise store, including a new furniture section, discount clearance department, and some updated fixtures.
The future of Boise’s empty Sears
The Boise mall continues with an empty main anchor store after the closure of Sears last year. Sears Roebuck sold the building and land under its former store in October to Seritage Growth Properties – a real estate investment trust spun out from the retailer.
Neither Seritage or Brookfield responded to several requests for comment on the future of the Sears store.
Former mall general manager Darren Howard told BoiseDev that they hoped to have a plan for Sears in place, but it could take some time.
In other markets, Seritage worked to revamp former Sears properties with a variety of uses – including splitting up the existing buildings for other, smaller tenants.
At the Kentucky Oaks Mall in Paducah, KY, for example, Seritage converted the former Sears mall store for multiple retailers, including a Ross Dress for Less, Burlington and nail bar. Many of the configurations for Seritage properties include external non-mall entrances for new tenants.
For Boise, Seritage lists the 123,623 square foot building on its website, and shows a configuration for three potential smaller tenants – one with mall access and two others reached from the mall parking lot.
In 2018, Before Sears closed, a marketing flier proposed shrinking the Sears’ store footprint and adding new retailers to the backside.
Continued change at Boise Towne Square
Aside from Sears, The mall’s online map shows nearly two dozen empty spaces – mostly smaller shops. But new national retailers like Windsor and Lovesac continue to backfill some of the vacancies. Some empty spaces added non-conventional uses, like a small arcade and game room.
The mall also benefits from the presence of the area’s only Apple retail store. The iPhone maker has the highest average sales per square foot in the industry – $5,500 according to CoStar. That swaps even high-end jewelry seller Tiffany & Co. by nearly double.
Several national retailers with BTS presences announced store closures, including H&M and Forever 21. The two “fast fashion” retailers take up significant footprints at Boise Towne Square, but the local locations did not make the closure list.
Brookfield and another mall operator – Simon Property Group – announced they reached an $81 million deal to purchase Forever 21 out of bankruptcy. The two real estate giants previously teamed on a similar effort for Aeropostale. The deals keep large tenants afloat and keep properties from experiencing greater levels of decline.
Boise Towne Square remains a key anchor for Boise’s economy – bringing foot traffic and customers to dozens of other businesses – both local and national, in the mall area. It’s also a key contributor of sales tax revenue to City of Boise and State of Idaho coffers.
Despite its struggles, Macys’ Genette remains hopeful for the future of the best malls.
“We believe these malls are here for the long run.”