Macy’s decision to close about 150 of its namesake stores by early 2027 will undoubtedly set off a wave of change at malls across the country. The department store operator has long been a staple anchor in malls, with stores ranging in size from 200,000 to 225,000 square feet. The closures will not only impact Macy’s itself but will also have significant implications for the malls where these stores are located.
The closures come as a result of changing consumer preferences, the rise of online shopping, and demographic shifts that have made some small towns or regions unable to support a bustling shopping center. While the closures may initially be seen as a negative development, they will ultimately be a positive change for many malls and customers. Chris Wimmer, a senior director at Fitch Ratings, believes that Macy’s exit will accelerate the demise of low-quality malls that no longer need to exist, giving healthier malls a chance to breathe new life and relevance into their spaces.
Macy’s closures will open up opportunities for mall owners to redevelop the spaces left behind by the department store. The former Macy’s boxes could be transformed into smaller retail spaces, or spark more significant changes such as the addition of apartments, medical buildings, retirement communities, grocery stores, or even entertainment venues like bowling alleys and movie theaters. Mall owners are eager to get their hands on these prime real estate locations and revitalize their shopping centers to better match the changing demographics and economy of their surroundings.
The closures of Macy’s stores are part of a larger trend of downsizing department stores and shrinking malls across the country. Other anchor stores like Sears, Lord & Taylor, and JCPenney have also downsized or disappeared from malls, leading to a decrease in the number of shopping centers classified as Class A and B. Mall owners are looking to diversify their tenant mix by adding non-retail uses like medical buildings, co-working spaces, nail salons, and restaurants to attract more foot traffic.
Historically, former Macy’s stores have been transformed into spaces that surprise and delight mallgoers. Major mall owners like Brookfield Properties have invested billions of dollars in retrofitting anchor boxes with new uses like grocery stores, movie theaters, sporting goods stores, and healthcare facilities. These projects not only breathe new life into malls but also draw more people to the shopping centers by offering a mix of retail, dining, and entertainment options.
In conclusion, Macy’s closures will undoubtedly bring about significant changes to malls and communities across the U.S. While the closures may initially be seen as a loss, they present an opportunity for mall owners to revitalize their spaces and cater to changing consumer preferences. The transformation of former Macy’s stores into new and innovative spaces will not only benefit the malls themselves but also create new experiences for customers and drive foot traffic to these shopping centers.