New York’s retail landscape post-pandemic will not look the same.
Numerous New York City retailers are planning to permanently close their outposts in 2020 as they grapple with the effects of the novel coronavirus along with other difficulties.
While the retail picture has already been evolving in recent years amid waning foot traffic and digital disruption, the coronavirus has brought with it a new set of challenges. The pandemic has slammed retailers by forcing stores across the country to temporarily shutter their doors and causing individuals to slash their discretionary spend. To maintain cash flow, companies haven taken steps such as cutting operating expenses, furloughing workers and tapping revolving credit lines. Further, a growing list of retailers — facing the coronavirus on top of existing problems — have filed for Chapter 11 bankruptcy protection, among them JCPenney, Neiman Marcus and J.Crew. And some store closures that were meant to be temporary have become permanent.
New York City has been hit particularly hard by the coronavirus, becoming one of the world’s largest hot spots. As of May 19, there are over 1.5 million confirmed cases of the coronavirus in the U.S., including more than 350,000 in New York state alone. If New York were a country, it would have the second-most cases behind only the U.S. But prior to the pandemic, the city had already seen an uptick in empty storefronts — the city-wide retail vacancy rate increased by 5.2 million square-feet from 2007 to 2017, according to the New York City Comptroller’s office — due to climbing rents and the growth of e-commerce.
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Below, FN rounds up the New York retail institutions that have shuttered — or could be shuttering —their doors this year.
After filing for bankruptcy in fall 2019, Barneys permanently shuttered its remaining units this February — including its Madison Avenue flagship and its location in Manhattan’s Chelsea neighborhood. Barneys’ new owner, Authentic Brands Group, said it will license the retailer’s name to Saks Fifth Avenue, with plans to reboot Barneys as a shop-in-shop at Saks.
In May, Gap Inc. was sued by landlord 48th Americas LLC, who said the retailer had skipped out on two months of rent payments amid the coronavirus pandemic. If an agreement cannot be reached between the two parties, Gap could end up shutting its Midtown Manhattan outpost for good.
On May 18, founder Jeffrey Kalinsky said that his three namesake stores, in Atlanta, New York and Palo Alto, Calif. would close their doors for good. Kalinsky opened his first store in Atlanta 30 years ago and sold a majority stake in his company to Nordstrom in 2005.
Kmart announced in February that it would close its Penn Station location. The four-level megastore, which opened its doors in 1996, was the discount chain’s first Manhattan outpost.
Neiman Marcus filed for Chapter 11 bankruptcy in May after weeks of speculation. Although the company has not announced plans to permanently shut stores at this time, it said it will “continue to assess store closure decisions.” The retailer’s five-floor outpost at Manhattan’s Hudson Yards opened in 2019. The company also operates Bergdorf Goodman on Fifth Avenue.
In January, Opening Ceremony announced that it would close all of its brick-and-mortar units after being acquired by New Guards Group. The brand, which opened its first outpost in New York’s SoHo neighborhood in 2002, will shift from being a multi-brand retailer to focusing solely on its eponymous label.