Bankrupt JCPenney is closing two high-profile New York City stores — at Manhattan Mall in midtown Manhattan and Kings Plaza in Brooklyn.
The Manhattan Mall store — which had once been a key part of the retailer’s strategy to become a more competitive fashion player — is closed and will not reopen.
The Kings Plaza unit has reopened, and will permanently shutter on Sept. 27. A liquidation sale will likely begin at that location next week, the company said late today.
In its statement, JCPenney listed 17 stores that will remain operable across the New York City area — and in nearby New Jersey.
The retailer had previously announced plans to exit 154 of its roughly 850 stores this summer; closures are currently underway at over 130 outposts, with more doors to be closed in phases. At other locations, liquidation sales are scheduled to begin July 7 and run through the end of September.
JCPenney is approaching a July 8 deadline to submit its business plan, which must be approved by lenders by July 15. When it filed for Chapter 11 protection in May, JCPenney planned to separate its real estate and operating business into two separate companies, in a so-called “prop co/op co” structure. Through this split, the “prop co” would be a public real estate investment trust owned by first-lien lenders; JCPenney is exploring the sale of the entire business to a score of potential investors.
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JCPenney must decide by July 8 if it will make a second draw on in debtor-in-possession financing. The company received court approval for a $900 million DIP package in June, including $450 million in new money. If it separates the real estate business, the retailer will be able to draw down the full $225 million in remaining DIP funds. If it chooses to sell its entire business, JCPenney will be able to draw down $50 million of the remaining funds.