What: Macy's is actively downsizing by closing even profitable stores, while J.C. Penney is maintaining and potentially expanding its store presence.

Why it is important: Understanding the distinct real estate strategies of Macy’s and J.C. Penney is crucial as it highlights different responses to the evolving retail landscape. Macy's strategy reflects a shift towards optimizing store profitability and adapting to new shopping behaviors, while J.C. Penney's approach underlines the importance of physical stores for maintaining mall traffic and local jobs, influenced by its ownership by mall operators.

Macy’s and J.C. Penney, two longstanding U.S. department store chains, are taking markedly different approaches to managing their physical store presence amid the challenges facing the retail sector. Macy's, under new leadership, is reducing its store count, including shutting down profitable locations, to adapt to a retail environment that has moved away from traditional shopping malls. Conversely, J.C. Penney, acquired out of bankruptcy by mall operators, is sticking to its roots in malls without downsizing, aiming to maintain community presence and support mall traffic. These strategies not only reflect their current operational goals but are also shaped by their ownership structures. Macy's is looking to optimize and modernize its operations as a publicly traded entity possibly going private, whereas J.C. Penney’s strategy is influenced by its aim to bolster mall viability, underlining the differing imperatives driven by their distinct ownership situations.

Macy’s and J.C. Penney have two very different real estate strategies