All Posts Tagged With: "linens n things"
As stores close, they leave behind an empty shell
Jennifer McClelland | RSS | Mon, Jul 06 2009 | 0 Comments
All across the country as big-box retailers, and many smaller ones, close their doors for good, they are leaving behind their empty store buildings and the building owners are having a really hard time trying to fill the empty walls.
Stores like the Home Depot in Bismark, North Dakota have left very little room for new potential buyers due to the very customized warehouse style building meant for the retailer.
So as more stores close their doors, many residents are having do deal with giant empty shells of what used to be stores, which are an eyesore, as well as the lost jobs and tax revenue.
Some buyers are finding ways to make the buildings usable. If you look at one in Minnesota, it became a Spam Museum, another in Texas, a indoor go-cart track. In Mississippi, an old Wal-Mart became a church. While less tax revenue is generated from the stores, at least there is some kind of tax benefit to be had as well as the fact that the building isn’t just sitting empty in the city.
The worst offenders are the big-box retailers that have gone into bankruptcy like Circuit City and Linens-N-Things. These retailers often had pretty large stores, and the look of Circuit City stores were often very customized for their company.
Some of the empty buildings have been converted for other uses, but some future tenants can be limited by the retail chain that once owned the building. Former retailers can sign leases that can keep competitors from moving into the building and are willing to pay for an empty building for longer than necessary.
“We are handing in excess of 2,000 locations for some 50-odd retailers, said Michael Burden, a principal with Excess Space Retail. “The square footage is in the tens of millions.”
Home Depot, for example, closed 15 underperforming stores last year, and 41 its smaller home improvement brands, including Expo Design Centers and YardBIRDS.
“The goal is to sell or lease the property as quickly as possible,” said Ron DeFeo, a spokesman for the Atlanta-based Home Depot. “The last thing we want is to see an empty store in a community — it’s a difficult enough decision to close a store in the community.”
In Frankfort, Ky., an empty Home Depot is adjacent to a sign welcoming visitors to the city.
Focusing on the positive, Phil Kerrick, economic development director for the city and Franklin County, says, “It’s a great building, in good shape and in a good location.”
Frankfort, Kentucky’s capital city, has dealt with vacant big box space before, when Lowe’s Cos. moved into a bigger box in town. The building was converted to a state office building.
As a sign of the times, in my city, an old Goody’s Family Clothing store was converted into a Goodwill drop off and retail location.
Related posts:125 FYE stores to close
Target will rent out retail space to Radio Shack for mobile phone sales
Tags: bismark north dakota, spam museum, empty shells
15 Companies that may not make see 2010.
Jennifer McClelland | RSS | Wed, Feb 25 2009 | 0 CommentsThese are tough economic times and the recession is taking its toll on businesses too. Giant chains like Linens N Things and Circuit City have closed their doors, now a list has come out about 15 companies that may not make it out of 2009.
1) Rite Aid: The one year stock price decline is 92%. Management has already lowered its outlook for 2009 twice. This is also the most leveraged drugstore chain in the United States.
2) Claire’s: This store sells cheap, trendy fashion jewelry. The Apollo Group paid $3.1 billion for it in 2007, but the store has seen only negative cash flow for most of the past year. Analysts believe that it is close to defaulting on its debt. The funny thing is Apollo group also purchased Linens-N-Things.
3) Chrysler: I’ve already gone into this one enough for everyone to know why it could go under this year.
4) Dollar Thrifty Automotive Group: Compared to the much larger car rental companies like Enterprise and Hertz, Dollar Thrifty Automotive Group is more reliant on people who travel for pleasure. Since there aren’t as many people going on vacation, this car rental company is hurting that way. Another thing is that it is closely tied to Chrysler (Chrysler supplies 80% of DTAG’s fleet).
5) Realogy Corp: Another Apollo Group purchase in 2007; right before the housing market went bust. This company is the largest real estate brokerage firm in the country.
6) Station Casinos: Las Vegas casino company that has 15 casinos that cater mostly to locals.
7)Loehmann’s Capital Corp:
This clothing chain has the right formula for lean times, offering women’s clothing at discount prices. But the consumer pullback is hitting just about every retailer, and Loehmann’s has a lot less cash to ride out a drought than competitors like Nordstrom Rack and TJ Maxx. If Loehmann’s doesn’t get additional financing in 2009 – a dicey proposition, given skyrocketing unemployment and plunging spending – the chain could run out of cash.
Sbarro: Since people aren’t going to malls as much, Sbarro misses out on the business. They also can’t benefit from late night sales because of its locations.
9) Six Flags: According to Moody’s, cash flow will be negative in 2009. A very serious issue facing the theme-park chain is that if people aren’t visiting during the summer months then it may not be able to pay its debts.
10) Blockbuster: Blockbuster is hurting because consumers have discovered that they can watch movies on the internet or rent from Netflix for cheaper (and when they pick one of these options, the movies are usually, if not always, in stock).
11) Krispy Kreme: Hasn’t earned an operating profit in 3 years and is hurting because of the health food craze as well as the fact people are cutting back on everything.
12) Landry’s Restaurants: Operates Chart House, Rainforest Cafe, and Kemah Boardwalk, it needs $400 million in new financing to close out a buyout from last June. If it can get the financing, it will likely ride out the recession. However two banks have already said no.
13) Sirius Satellite Radio: Hasn’t profited yet and is paying talent like Howard Stern a high salary.
14) Trump Entertainment Resorts Holdings: Already filed for bankruptcy protection
15) BearingPoint:
Related posts:BearingPoint. (BGPT; about 16,000 employees; stock down 21%). This Virginia-based consulting firm, spun out of KPMG in 2001, is struggling to solve its own operating problems. The firm has consistently lost money, revenue has been falling, and management stopped issuing earnings guidance in 2008. Stable government contracts generate about 30 percent of the firm’s business, but the firm may sell other divisions to help pay off debt. With a key interest payment due in April, management needs to hustle – or devise its own exit strategy.
The 27 Cars in 2010 that are considered the safest.
2009 resulted in a HUGE loss for the USPS; Expect more in 2010.
Tags: price decline, apollo group, real estate brokerage firm
