Name: Mall department stores were struggling. The pandemic has pushed them to the edge of extinction.
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Mall department stores were struggling. The pandemic has pushed them to the edge of extinction.

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This article was published more than&nbsp;1 year agoCommentGift ShareAdrienne Whyte used to go to the mall twice a week, where she might meet up with her personal shoppers at Neiman Marcus and Saks Fifth Avenue or scour Macy’s for bedding and kitchenware.But it’s been well over a year since she set foot in a department store — and she isn’t sure when, or whether, she will again.“Now if I need something, I buy it online,” said the 72-year-old retiree from Falls Church, Va. “The department store is a one-stop shop, but so is the Internet.”Department stores, once a middle-class mainstay of convenience and indulgence, had been spiraling downward long before the pandemic turbocharged online shopping and helped tip a number of big-name retailers into bankruptcy. Nearly 200 department stores have disappeared in the past year alone, and another 800 — or about half the country’s remaining mall-based locations — are expected to be shuttered by the end of 2025, according to commercial real estate firm Green Street.AdvertisementChange in number of stores 2016 vs. 2021Roughly 40 percent of the nation’s department stores have closed since 2016, including every Lord &amp; Taylor and nearly every Sears. About half of the remaining 1,600 mall-based locations are expected to shutter by 2025.J.C. Penney-34%1,000storesMacy’s-31%Sears-96%500Dillard’s-8%Lord &amp; Taylor-100%0Nordstrom-15%Neiman Marcus-16%Source: Retailers’ corporate earnings and annual reports, Green Street AdvisorsDANIELA SANTAMARINA/THE WASHINGTON POSTChange in number of stores 2016 vs. 2021Roughly 40 percent of the nation’s department stores have closed since 2016, including every Lord &amp; Taylor and nearly every Sears. About half of the remaining 1,600 mall-based locations are expected to shutter by 2025.J.C. Penney-34%1,000storesMacy’s-31%Sears-96%500Dillard’s-8%Lord &amp; Taylor-100%0Nordstrom-15%Neiman Marcus-16%Source: Retailers’ corporate earnings and annual reports,Green Street AdvisorsDANIELA SANTAMARINA/THE WASHINGTON POSTChange in number of stores 2016 vs. 2021Roughly 40 percent of the nation’s department stores have closed since 2016, including every Lord &amp; Taylor and nearly every Sears. About half of the remaining 1,600 mall-based locations are expected to shutter by 2025.Number of storesJ.C. Penney-34%1,000Macy’s-31%Sears-96%500Dillard’s-8%Lord &amp; Taylor-100%Neiman Marcus-16%Nordstrom-15%0Source: Retailers’ corporate earnings and annual reports, Green Street AdvisorsDANIELA SANTAMARINA/THE WASHINGTON POSTThose closures, analysts say, will have a cascading effect on American shopping malls, which already are battling record-high vacancy rates and precipitous drops in foot traffic, as well as on the commercial real estate market and the broader economy.“There’s nothing department stores have done to make themselves particularly relevant in the 21st century, and the pandemic has only made that more clear,” said Mark Cohen, director of retail studies at Columbia Business School and former chief executive of Sears Canada. “They have too many stores, too many things, too many brands. The customer who used to be handcuffed to their local department store is no longer tethered because they have an online alternative that’s become even more attractive in the last year.”The pandemic set off an economic chain reaction that rippled through the country’s department store chains, forcing several into Chapter 11 proceedings. Neiman Marcus, Stage Stores and J.C. Penney last May, followed by Lord &amp; Taylor and, most recently, Belk in February. Even companies on relatively stable footing, like Macy’s, are shuttering dozens of stores as they try to move away from traditional shopping malls. Overall sales at department stores plunged more than 40 percent at the beginning of the pandemic and have yet to make up for lost ground, according to Commerce Department data, as Americans do more of their shopping online and gravitate to specialty brands and discount chains.AdvertisementMajor brands like Macy’s, Nordstrom and Kohl’s have reported steep sales declines during the coronavirus crisis, which slashed demand for the clothing, shoes and formalwear that disproportionately fill their stores. However, analysts say, the pandemic’s most disconcerting legacy may be its imprint on consumer behavior, raising questions about the sector’s ability to win back customers and properly rebound even after life returns to normal.Whyte, for example, has built up a roster of specialty retailers she now buys from directly: Rothy’s for shoes, Lands’ End for clothing, Sephora for makeup. The former management consultant also has found that she can simply do with less.“It used to be ‘see it, want it,'” she said. “But during the pandemic, I’ve realized I don’t need as much as I thought I did.”Advertisement***The earliest American department store, Arnold Constable, was founded nearly 200 years ago in Manhattan. It sold an array of clothing, jewelry, handbags and stationery, earning it the nickname “the palace of trade.” The chain eventually expanded throughout New York and into Pennsylvania and New Jersey. It ended its run in 1975, after filing for bankruptcy.By then, Americans had fallen in love with department stores. Shopping malls proliferated across the country, anchored by national chains including Macy’s, J.C. Penney, Marshall Field’s and Bealls that offered the ease of one-stop shopping and an air of attainable luxury.But such retailers have lost much of their allure in the past decade, analysts say, as Americans were presented with more alternatives, including discounters like TJ Maxx and Ross Dress for Less and online specialty retailers like Stitch Fix and Everlane. The erosion of the middle class has also chipped away at the fortunes of chains such as Macy’s and J.C. Penney.Advertisement“In the old days, department stores offered convenience,” said Greg Portell, a partner in the consumer and retail practice of consulting firm Kearney. “But now that we can get that without leaving the couch, it’s no longer enough. Department stores have to offer more: They need smart curation, high-touch service and personalization.”To that end, Saks Fifth Avenue is spinning off its website into a stand-alone company, in hopes of doubling down on e-commerce. Nordstrom is offering virtual styling appointments and recently launched an online channel, where shoppers can buy merchandise during live-streamed events.At Neiman Marcus, the first department store chain to file for bankruptcy during the pandemic, executives say they have invested heavily in e-commerce, hosting “shoppable” virtual events and making store employees available by text, email and video chat.Advertisement“We’ve never had to make so many changes at once like we did in the past year,” said Lana Todorovich, president and chief merchandising officer of the Dallas-based retailer. “Everything, including our product assortments, changed in an incredibly short period of time.”The company, she said, is stocking its shelves more frequently with “buy now, wear now” products and is seeing a resurgence in bridal wear, as well as swimwear and jewelry.Overall retail spending rebounded sharply in March, rising 9.8 percent after an unexpected dip in February, the Commerce Department reported this week. Department store sales rose 13 percent from a month earlier, boosted by recent stimulus checks and burgeoning demand for clothing and shoes, though they have yet to reach pre-pandemic levels.But analysts say retailers’ challenges extend beyond short-term sales figures. They also must grapple with questions about the viability of shopping malls, for which vacancy rates hit 11.4 percent in the first quarter, compared with 10.5 percent the preceding three months, marking the biggest spike on record, according to Moody’s Analytics’ commercial real estate division.AdvertisementAlready struggling mid- and lower-tier malls have been disproportionately affected, adding to the widening gap between the country’s most profitable malls — which tend to be newer, well-lit properties with restaurants and in-demand chains like Apple, Lululemon and Sephora — and the rest of the industry, analysts said, though the latest round of bankruptcies and liquidations has created new challenges throughout the industry.Even the country’s newest and most expensive mall hasn’t been immune: American Dream, a $5 billion megaplex in New Jersey, opened shortly before the pandemic with an indoor ski resort, hockey rink and water park. But many of its largest retail spaces remain dark, after Barneys New York, Lord &amp; Taylor and Century 21 pulled plans for anchor stores following bankruptcy filings.“The department store as an all-encompassing emporium is a product of the 20th century and a victim of the 21st,” said Cohen of Columbia Business School. The best will prevail, he added, because people are not going to settle as they once did, “simply because they don’t have to.”***AdvertisementJoe Edwards recently stopped by a department store for the first time in years. He wasn’t there to browse, though; he was there for his coronavirus vaccination.The excursion to an abandoned Gordmans store in Champaign, Ill. — where, as a child, he used to watch Nickelodeon while he waited for his mother to shop — brought back a flood of memories for the 26-year-old. It also felt “profoundly dystopian,” he said.“Here I am sitting in a foldout chair, getting my vaccine surrounded by old mannequins and clothing fixtures,” said Edwards, a graduate student at the University of Illinois who now buys most of his clothes at thrift stores. “The whole time I’m thinking: Wow, this is what this place has come to?”The store, which closed during the pandemic, is one of hundreds of department stores to fold in recent years. The country’s largest department store chains have shuttered roughly 40 percent of their locations since 2016, according to a Washington Post analysis of corporate earnings releases and annual reports.AdvertisementSome of those locations have found new life — most recently as coronavirus testing or vaccination centers, but also as Amazon warehouses, community colleges, medical offices and car dealerships. Commercial real estate experts say the sprawling properties left behind in U.S. shopping malls are often well-positioned, with large parking lots and easy access to highways and public transportation. (Amazon founder Jeff Bezos owns The Washington Post.)“Many of these malls built in the ’60s, ’70s, ’80s and ’90s were economic development projects, so they’re surrounded by great infrastructure,” said , a principal at commercial real estate services firm KLNB. “The question now is: What’s the next chapter in this story? Malls may not have five or seven department store anchors like they once did, but they may have other uses: A grocery store or a car dealership or a hotel. We just have to live through the cycle.”In Chicago, Kimber Russell isn’t much interested in going back to the way things were. Before the pandemic, the 47-year-old attorney bought most of her clothes at Loft and Express, and occasionally stopped in at Nordstrom or Macy’s. These days she orders everything online and has set up subscriptions for items like dog food, toilet paper and disposable masks. She can’t imagine going back to shopping in person, she said.“If I were to walk into a department store right now and see all of those choices — teens, petites, misses, juniors, sportswear — I’d just be like, ‘No!,'" she said. “There is just so much stuff to sift through, and the pandemic has made me realize I don’t need more choices. It’s too overwhelming.”The latest: , a strategic shift that puts more of the onus on individuals, rather than on schools, businesses and other institutions, to limit viral spread.Variants: BA.5 is the most recent omicron subvariant, and it’s quickly become the dominant strain in the U.S. , and why vaccines may only offer limited protection.Vaccines: For people under 50, while the Biden administration works to roll out shots . Immunizations for became available this summer. Here’s by your prior infections and booster history.Guidance: CDC guidelines have been confusing — if you get covid, here’s . We’ve also created .Where do things stand? See the latest coronavirus numbers and . The is behind much of the recent spread.For the latest news, . CommentsGift ArticleTOP STORIESThe Fact CheckerFinding the truth behind political rhetoric, reviewing claims to see what’s accurate and what’s misleading.Try a different topic or to save your preferences

This article was published more than&nbsp;1 year agoCommentGift ShareAdrienne Whyte used to go to the mall twice a week, where she might meet up with her personal shoppers at Neiman Marcus and Saks Fifth Avenue or scour Macy’s for bedding and kitchenware.But it’s been well over a year since she set foot in a department store — and she isn’t sure when, or whether, she will again.“Now if I need something, I buy it online,” said the 72-year-old retiree from Falls Church, Va. “The department store is a one-stop shop, but so is the Internet.”Department stores, once a middle-class mainstay of...

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Economics Correspondent for The Washington Post. @LoebAwards winner. Northwestern grad. Austin native. Email with stories or tips: abha.bhattarai@washpost.com

Mall department stores were struggling. The pandemic has pushed them to the edge of extinction.

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