This last week, I made my annual pilgrimage to the ICSC Recon convention in Las Vegas in support of our retail group.
At any convention, I have always found one gets as much out of riding in a taxi or a visit to coffee shop as one gets on the convention floor. This year was no different. I offered a ride to a fellow who turned out to be with J.C. Penney. As we visited, it was evident to me again that, at times, news is about sensationalism.
J.C. Penney reported earlier in the year they were closing 140 stores, about 13% of their stores. What was not said, is that these stores produced less than 2% of EBITDA, and contributed 0% to the net income. The stores needed to close, because they were weak per square foot in sales and a drain on the brand. It was a market correction, just like we all do on the private sector, except J.C. Penney is public. This kind of announcement makes good headlines, but it makes people think the “sky is falling,” when in reality it is a course correction.
Beyond the JC Penney action, we have a substantial program going with one of our long-time customers with some terrific “in the box” remodeling and rebranding. So while some players are getting out, or better forced out, the good ones know how to win and will do so combining the world of electrons and GLA.
On another note, I did have an interesting meal at The Stratosphere Needle at 1200’ above the desert. It was a nice dinner, and we got to watch sane people (we think) jump off the roof. While I may never make it back to the needle again, I do recommend the restaurant at the top. You will be surprised as well–good service, and good food.