urbanSTL

Maybe all of this has already been known for a while and IKEA is moving into this building. Or Google.


one can dream....

I just hope that St. Louisans don't get the typical, woe-is-US attitude about this closing. It has been pretty well known or at least everyone has known that it was highly likely that it would close. In the booming metropolis of Houston, they recently closed their 700,000 SF downtown store within the last year or so. We new this was coming. Now the building can be redveloped into a better asset downtown. I agree with other commenters, they never even tried with this store. Sadly, it could have been so much more.

View it as an opportunity to rehab the store fronts and attract smaller retailers like CVS, Payless Shoes, Aldo, Brooks Bros, Nordstrom Rack, etc....

Basically replacing what Macy's offered in the form of smaller less risky stores.

Bum deal, I guess the writing has been on the wall for a couple of years now- I personally spent about 50 bucks there annually, if I was going to shop Macy's it was the one.

This is going to change the dynamic of downtown space since Yackey was kind of dependant on them to fuel the renovations on that building.

I see this as being a hard sell for any future retailers, too few of them who would pursue urban options, fewer who would tackle that building.

Presbyterian wrote:In 2010, it was reported that Macy's signed a 5-year lease. Given the tax credits and city support that went into the renovation, I'm assuming the five years rent was guarranteed. This could give the owners some breathing room. It could also motivate Macy's actively to market and sublet the space.

http://www.stltoday.com/business/railwa ... 247ea.html

It would interesting to know the actuall terms of the lease, if their is a buy out? Also, I know a lot grocery chains as other retail will put in non compete clauses that pretty much makes sure the property won't get utilized by an immediate competitor. I think a City Target is a great idea, but wondering if the current lease would keep that from happening in the immediate future.

shadrach wrote:Devastating, not the Monday I was looking forward to. I find we're throwing GC in the river and were losing Macys.

Kind of a serious blow to the MX concept. I'm sure MX was aware of it or planned for it.
I just cant even image what could go in that building.

Don't really see this as a blow to the MX Concept. I think the important aspect is seeing continued success with T-Rex and hopefully landing a tech company like Google!! To me, retail will happen for downtown if residential units keep filling up and other companies expand their presence. Unfortunately, the nail in the coffin was Famous Barr being bought by Macy's

Long term this is addition by subtraction.

Someone said early that this is bad for MX. On the contrary, I think it is good. They have got some good concepts up on Washington, but Macy's is more of a barrier to what they are doing than an anchor, from a physical (closed first floor windows, not active with pedestrians shoppers) and co-tenancy (it was never an attractive store) perspective. How many people that go to PI or the Collective shop at Macy's Downtown?

This opens up an opportunity to expand the MX concept further into the office core of Downtown. The Olive facing storefronts would be particularly attractive, even once a few of those fill up it will activate the street much more than Macy's has in recent years.

rawest1 wrote:

Presbyterian wrote:I just saw that. While I'm disappointed, I'm not surprised. The day of the large department store is probably behind us, and this particular store had limited hours and a location that seemed like it was a couple blocks too far east and a couple blocks too far south. I suspect Macy's was losing money there.

The store may have been a joke to you, but I see no humor or upside in this announcement. I can't say I'm completely surprised that this is happening, but I am surprised that it's happening so soon and at a time when the surrounding blocks are finally buzzing with some activity after years of feeling dormant.

I trust and assume the Railway Exchange Building owners/developers saw this coming and factored it into their master plan. Still, anyone that thinks this isn't a serious blow to downtown is kidding themselves. Sure, business was never booming there. But when I've shopped there, it hasn't been lacking either. It may not have been the best Macy's location ever, but to tourists, shoppers, downtown workers, and a few loyal locals like me, it was pretty damn convenient. Now when a convention goer is staying downtown and needs a pair of socks or shoes, where is he or she supposed to go? Macy's selection may have been unfortunately limited, but don't tell me that this person is going to find what he/she wants at the couple of boutiques that have managed to stick it out downtown over the last few years.

I cannot even begin to describe how sad I am about the loss of place. My grandmother worked at May Company for years, and when I came to visit her, even on her days off we always wound up at Famous-Barr. I felt like I lived in that building at times. It mattered so much to me that whenever I wanted to shop at Famous-Barr (and in later years, Macy's), I'd go there. When my wife wanted to go to Macy's, I'd say, "Let's go downtown!". When we wanted to go downtown, I'd say, "Let's go to Macy's!". I took my son to the grand re-opening in 2006, I took him and my daughter to see the train displays, we went to every Breakfast with Santa, and we went to the candy counter and ate at Papa Fabarre's. And even if the selection wasn't as great or the store wasn't as nice as other locations, I still preferred to go there. It always felt like I was traveling back to the past. Today's news was a harsh dose of reality- you really can't ever go back again.

I am disappointed in the both the city and Macy's. The city gave Macy's tax breaks to downsize the store, yet Macy's isn't staying past year two of a five-year lease. The city bought all of Macy's promises, all of which have been broken as of today. And Macy's put very little money into the store, they never really tried to promote it to locals (no special events beyond the holiday events, no validated parking or extended hours except for the holidays, etc.). But the city would never expect anything in return from a Corporate America monolith like Macy's, or wealthy business owners like the Cardinals that made similarly large promises (blocks of high-density development) and failed to deliver (cowboy bar and a big parking lot).

MattonArsenal wrote:Long term this is addition by subtraction.

Someone said early that this is bad for MX. On the contrary, I think it is good. They have got some good concepts up on Washington, but Macy's is more of a barrier to what they are doing than an anchor, from a physical (closed first floor windows, not active with pedestrians shoppers) and co-tenancy (it was never an attractive store) perspective. How many people that go to PI or the Collective shop at Macy's Downtown?

This opens up an opportunity to expand the MX concept further into the office core of Downtown. The Olive facing storefronts would be particularly attractive, even once a few of those fill up it will activate the street much more than Macy's has in recent years.

I'm not one of those naysayers that thinks this is some sort of death knell for downtown. Mercantile Exchange and the blocks around it will be fine long-term thanks in part to some of the newer additions to the area. But pardon me if I don't see this as 'addition by subtraction' just yet. Whatever happens, filling the space Macy's leaves behind is going to take even more tax breaks. And what retailer will be keen to fill the void when Macy's is walking away from a five-year lease in the second year? What about those aforementioned tourists and convention attendees, who may have thought downtown was lacking in some ways but at least it had a department store? And I also think it's a bit short-sighted to assume that someone that dines at Pi or shops at the Collective isn't going to shop at Macy's. Just because Macy's Downtown isn't cool by someone's arbitrary standards doesn't mean that it's not a significant loss for downtown. We can dream all we want about some supposedly better and higher uses for the Macy's space, but until we know the terms of the lease from which Macy's is walking away, and until we accept the fact that there's a fair amount of supply of retail space in downtown St. Louis and not so much demand, what's next?

shadrach wrote:I agree but, good grief there is no action on the south end of the MX. There is no streetscaping, it's barren and soulless. This is the part that MX controls and have seen no attempt to bring it to life. Also, the 600 Washington entrance is a barrier to extending the activity/vibe south.

Just as the north end is Pi/movies/the Collective facing the Embassy and Nat. Blues Museum, so the south end needs some retailers to face a new T-Rex concept. Personally, I was always hoping Macy's would have opened up their building, draw on the street more. I guess the disappointment is the Macy's never facilitated retail across the street. So maybe its loss isn't so bad. It just that the two corners are turning into a blackholes.

Sidenote, I hope against hope that Stifel's renovations will open up the building, add more entrances, possible retail or something to get action moving down 6th street.

Shadrach, as usual, I agree with you. I believe the area will eventually rebound, but as you said, the south side of MX and the south side of Macy's already function as black holes. And that's the main reason why I cannot see any positives when the store that occupies the entire block between these dead zones is about to close.

stlgasm wrote:And here's another whammy...

People's Bank and PNC Bank announced today that they are closing their downtown locations: http://www.stltoday.com/business/local/ ... 0bb20.html

It does seem like downtown is merely treading water lately. There has been a lot of residential growth, and that's wonderful, but we still almost no new infill construction (save for the empty Roberts Tower) to replace existing parking lots and garages. I went to lunch downtown today, it's depressingly quiet in much of the CBD even during a business day. We probably have one of the least congested downtowns of any major city in the country.

That said, it's still the most amazing city in the world and I love it with all my heart.

I noticed the news about the bank closings as well. And, as usual, I agree completely with your take on things.

I love it here, too, but I get the same impression about downtown lately. My long-term outlook is still optimistic, but my soul is feeling a bit crushed right now.

Alex Ihnen wrote:Always good to ask what downtown should aspire to being - the city often seems happy to have it be the center of sports and festivals/parades. Neither are economic pluses, but seem to be politically popular.

The problem is the region seems like it wants nothing to do with downtown (except baseball)
A lot of the middle class in west county and further think you will be shot the moment you step foot in downtown. TO make downtown better we need to stop building new stadiums and turn in to light rail hub. I feel if no major company moves there or no new light rail lines in the next few years downtown could start to slide again.

Before we jump off a building lets look at the long term and not just what happened today. Almost all the news regarding downtown this year has been positive. Still a lot of activity in the pipeline with the renovation of Roberts Tower, MX Movie Theater, Streetcar, SLU Law, TREX, etc

Did anyone shop there except for Cardinals Play-Off or World Series gear? I went in last winter and couldn't believe it had recently been renovated. It felt stuffy and old, and all of the merchandise was clearly the most low-end stuff that Macy's has to offer. I think there's a major divide between the people who are moving downtown in droves (young, childless, fashionable, with disposable income) and the clientele that this Macy's was gearing itself toward (older, more conservative, more cost conscious). Also, if you're a business traveler staying downtown you're not going to go shop at a low-end Macy's when you have one in your hometown and 10 other stores you like more. Also, they can't possibly expect this store to be a regional draw when they invest so little in it, and there are Marshalls, T.J. Maxx, J.C. Penney, Kohls, Dillards, Macy's, etc... scattered all over the region.

This is tough for downtown because the Railway Exchange is such an awkward and massive space, but I see this as more of a testament to the obsolete department store retailing model than any sort of slipping or sliding by downtown as a neighborhood.

Downtown development has slowed these past few years during the recession and slow economic recovery, but I don't think downtown is necessarily on the verge of sliding back to the early 90s. Macy's closing is bad news, but I don't think it signifies that downtown has declined in the past few years as much as it signifies that department stores around the country are generally in decline.

Just to brighten the mood a bit and remind you of what's happened in the past couple of years and what we have to look forward to within the next 2-3 years alone.

Last few years:
MX
Laurel
Peabody
Central Library
Park Pacific

Coming soon:
Millenium Center
Arcade
Chemical Building
Municipal Courts
Ballpark Village Phase One
Archgrounds Redesign
SLU Law School Relocation
Streetcar Plans
Union Station redevelopment

The Macy's announcement just makes the dearth of retail downtown all the more scarce. My hope however, is that other smaller retailers would seek to fill the void now.

As a start, downtown, in my opinion, needs "off-price" and discount retailers such as Ross, TJ Maxx, Marshall's and K&G, dollar discounters such as Family Dollar, Dollar General, Dollar Tree, etc. and women's stores such as Dress Barn, Rainbow, Fashion Bug, Cititrends, Payless Shoe Source, Shoe Carnival. Trader Joe's, Whole Foods, etc. - forget about it. It is going to be a long time before downtown sees high-end retail so the best thing for it to pursue are off-price and discounters for now.

Downtown St. Louis ISN'T too good for discounters and dollar stores.


Dress Barn on 16th Street in downtown Denver.

I haven't heard ANYTHING in regards to City Hall trying lure national retailers downtown in a while. City Hall used to be aggressive in this regard. Now that Macy's is gone let the competition begin.

Although I am glad Peoples National Bank chose downtown for a location for as long as it did, a bank branch closing downtown is not as big as the Macy's announcement. There are plenty bank branches downtown.

PNB's location is on a high-profile corner. It will become occupied - even if it is converted into nice restaurant or retail store. Some business would want to capitalize off of Culinaria's location, I'm sure.

Last, another issue for me is that I do not understand why Macy's hasn't filled up the Railway Exchange with more of its local call center and corporate employees. Why in the hell are they in Earth City anyway?

St. Louis is definitely not along in the tide of Downtown department store closings. Here in Minneapolis-St. Paul we have also seen department stores leave the two downtowns. This year alone, Neiman Marcus closed their downtown Minneapolis location while Macy's closed their downtown St. Paul location.

All of this is occurring at a time in which new investment is pouring into both downtowns, especially Minneapolis. In downtown Minneapolis alone, ~35,000 people live there, tons of new residential towers/buildings are under construction, and ironically a brand new 27-story luxury apartment tower is under construction right across from the old Neiman Marcus space.

Also in Downtown St. Paul, the new light rail line runs right next to the old Macy's building, so it seems as if the decline in downtown department stores is part of a national trend that is bucking the trend of reinvestment in the city centre. This in some aspects will allow downtowns to expand retail offerings by reutilizing these spaces, possibly including many retail stores in one former department store space. St. Paul in fact is considering tearing down the old Macy's building and reutilizing the entire site.

Joseph Huber wrote:St. Louis is definitely not along in the tide of Downtown department store closings. Here in Minneapolis-St. Paul we have also seen department stores leave the two downtowns. This year alone, Neiman Marcus closed their downtown Minneapolis location while Macy's closed their downtown St. Paul location.

All of this is occurring at a time in which new investment is pouring into both downtowns, especially Minneapolis. In downtown Minneapolis alone, ~35,000 people live there, tons of new residential towers/buildings are under construction, and ironically a brand new 27-story luxury apartment tower is under construction right across from the old Neiman Marcus space.

Also in Downtown St. Paul, the new light rail line runs right next to the old Macy's building, so it seems as if the decline in downtown department stores is part of a national trend that is bucking the trend of reinvestment in the city centre. This in some aspects will allow downtowns to expand retail offerings by reutilizing these spaces, possibly including many retail stores in one former department store space. St. Paul in fact is considering tearing down the old Macy's building and reutilizing the entire site.

Thanks for a healthy dose of perspective- I need it right now!

You brought up a good point regarding the future of downtown department stores. Frankly, there might be more attrition nationwide before it's all said and done. Outside of Herald Square in Manhattan and Union Square in San Francisco, I can't think of too many places where Macy's can make a go of long-term in downtown areas. In addition to the old Dayton's in downtown St. Paul, Macy's also closed locations in downtown Honolulu (originally Liberty House) and downtown Houston (originally Foley's). Based on what I know about Boston, I wouldn't be surprised if their Downtown Crossing (Jordan Marsh) store closed someday, because it's not really at the center of activity in downtown Boston. I even wonder how Macy's at State Street is doing in Chicago as well, because (1) Macy's has a store on Michigan Avenue, which supplanted State Street some time ago as the true shopping destination, (2) Carson's closed its State Street flagship about five years ago, and now a CityTarget is there, and (3) many Chicagoans still hold a fierce grudge against Macy's Inc. for getting rid of the Marshall Field's name and its house brand merchandise.

I get the impression that Macy's must have made the decision to pull the plug on the downtown store some time late last year or early this year. Macy's typically announces its store closings in January. And Maggie Crane, Mayor Francis Slay's spokesperson, said the mayor's office has been in conversations with Macy's corporate since January to try to convince them of all of the positive things taking place in downtown St. Louis. Obviously it wasn't enough to save the store, which is really unfortunate. I just wish the city would have done more to make retail attractive in the surrounding blocks, because Macy's really suffered from a lack of co-tenancy. People weren't as willing to shop there when there were no shops nearby, not when they could go to the Galleria or West County Center and have multiple anchors and hundreds of shopping options, all with free parking. Macy's only offered validated parking and special events during the holidays while all of the other events and celebrity appearances were scheduled at the Des Peres and Richmond Heights stores, and then they even got rid of the holiday events as well. I hoped that perhaps Macy's would weather the storm and benefit as MX evolved, but I suppose the death of St. Louis Centre and the rebirth of MX was too little, too late.

Also, can someone PLEASE explain to me why in the hell Macy's would close the downtown store and keep stores open in Alton Square and Jamestown Mall? Not only are those malls completely dead, the areas in which they are located are utterly depressing. You'll never convince me that those stores perform any better than the downtown store, or that there's any advantage or potential to be realized by keeping them on life support as they're pulling the plug on downtown prematurely in my opinion.

One final thought: This is the 100th anniversary of the Railway Exchange Building. What a way to celebrate. I guess that's the magic of Macy's.

I would imagine that the Jamestown location will be the next to close. What is really happening is that department store closings are part of a long term retail trend. Department stores are closing in underperforming locations - downtowns and old suburban malls. Furthermore, no new shopping malls in the United States have been built since 2006 I believe, this means that new new department stores are being added in shopping malls. Sure there are stand-alone locations, but department stores aren't growing by any means, they are simply adjusting to the reality of the market.

Furthermore, the competition from online shopping has truly hit this industry hard, I believe I read St. Louis has one of the highest rates of online shopping too.

Additionally, retail stores have begun to truly specialize. Department stores are a catchall for many different brands and products. With competition from independent retailers, companies that have launched their own retail locations (North Face, Patagonia, Apple, etc.), and other companies that have hyper-specialized such as (Lululemon) , department stores face a tremendous uphill battle trying to compete in the market today.

Specialization is what the former JC Penny's CEO, Ron Johnson, (former head of Apple retail) tried to do. His push to diversify and modernize the department stores was unique in that he crafted a plan to include smaller stores within the larger department store. Several malls in the area have seen this with the addition of Sephora and Levi Jeans in a very defined section of the store. I believe he was also pushing for Caribou Coffee to open locations as well, but the deal never went through. This strategy in conjunction with a new pricing strategy hurt the JC Penny's brand and he was let go. I can only wonder if this was a temporary occurrence and if his plan would have succeeded if fully implemented...

Thank you Joseph Huber, just as I suspected everyone is overly reacting to this closing as if it's somehow a testament to downtown's future. This store likely would have closed years ago without May Co. sitting on top of it. Denver hasn't had a large downtown department store in years. As Joseph also mentioned, only San Francisco, Chicago, and New York are really the only ones with vibrant large, historic really, department stores. Again, even the boom-town of Houston coldnt support its downtown Macy's. This building can now be repositioned as something cooler, and better for downtown. Perhaps four smaller stores could fill up the first level or two. T-REX could continue to flourish, more apartments could be added. I'd love to, ideally, see a major company relocate into the building from another city. I still can't believe Gene Khan would dare to live in St. Louis after destroying May Co. In any event, downtown continues to add 500 people each year and occupancy is above 90%. We need to continue to grow these numbers.

"Furthermore, no new shopping malls in the United States have been built since 2006"

A joint venture between a Michigan developer and Benderson Development Co. is building the Mall at University Town Center, a $315 million center that will be the region’s largest shopping hub when completed in October 2014.
http://www.heraldtribune.com/article/20 ... /130519676

Once Macy's sold the building, there was little chance of the store staying open long term. That location has been losing money since before the merger, and its known Macy's will only keep open underperforming stores if they also own the building. They can not wait 5-10 more years for DT to 'fill up'. Lets face it, tourism $ make a big difference in many big cities, and its just not there in STL.