With bankruptcy and store closings in its future, Augusta’s J.C. Penney store is at risk.
One in three.
That’s the chance of Augusta’s J.C. Penney department store closing in the coming year.
The retailer filed for bankruptcy May 15 in the midst of the coronavirus outbreak. The company announced it would close nearly 30% of its stores. That’s 242 locations.
The Plano, Texas-based retailer has not yet released a list of stores it intends to close. You may recall the retailer closed 27 stores last year, some of which were in metro Atlanta.
The bankruptcy plan is to close 192 stores this year and an additional 50 in 2021. It’s remaining 604 stores will “represent the highest sales-generating, most profitable, and most productive stores in the network,” the company said in an SEC filing.
I have no idea how well the Augusta store – which anchors the west side of Augusta Mall – is performing compared to its peers across the country. But I suspect the store must be “profitable enough” to have lasted this long.
Personally, my hope is that the store will stay open. Augusta Mall has already lost one anchor – the Sears store closed last month – and losing another might cause the the city’s most high-density retail center to slowly slide into oblivion.
Losing two of its five anchor stores – the remaining being Dillard’s, Macy’s and Dick’s Sporting Goods (I don’t count the Barnes & Noble store) – would surely make retailers occupying space inside the mall pause when their leases come up for renewal.
Most retailers are hurting these days. J.C. Penney isn’t the only one seeking bankruptcy protection. J. Crew, Neiman Marcus, Earth Fare, Pier 1 Imports and True Religion Apparel have all gone Chapter 11.
So has Stage Stores, which owns the Goody’s, Bealls and Gordmans stores. Forever 21, Jo-Ann Stores and David’s Bridal are all seeking a buyer to save them.
Last year more than 60% of store closings were in the apparel sector, according to marketing data firm Coresight Research.
Think of all the stores that have disappeared in recent years – Payless ShoeSource, Toys R Us and Borders books just to name a few.
Peir 1’s chief financial officer, Robert Riesbeck, describes the current state of affairs: “Unfortunately, the challenging retail environment has been significantly compounded by the profound impact of COVID-19, hindering our ability to secure such a buyer and requiring us to wind down.”
The Steak ‘n Shake chain has permanently closed 51 of its corporate-owned stores (the one in Augusta is owned by a franchisee). Ascena Retail Group, which owns stores such as Lane Bryant, Justice, Loft and Ann Taylor, is not doing well. Neither is GNC, which announced it would close more than 300 stores this year before the pandemic even began.
The only retailers that seem to be doing well are dollar stores, Walmart, Costco, Lowe’s, Home Depot, Walgreen’s and CVS. Oh, and liquor stores seem to be pretty busy, too.
Many brick-and-mortar retailers were struggling before the coronavirus pandemic hit. Now that consumers are sheltering in their homes like Branch Covidians and spending more money with online retailers, the traditional stores are hemorrhaging cash and having trouble paying their heavy debt loads.
It certainly doesn’t help that America is “over retailed.” The United States has roughly 24 square feet of retail space for every man, woman and child. Canada has about 17 and Australia is 11. Most of Europe falls between three and five.
Bottom line: I don’t want Augusta’s J.C. Penney to disappear. It would cause dozens of lost jobs, a dip in sales tax collections and a big empty box at the mall.
I’ve never understood the gleefulness that some people show (usually on social media) when a store closes. As free-market capitalistic kind of guy, I completely understand why certain businesses go under.
But I don’t take delight in their failure.
Whether you like the store or not, people will lose their jobs. The city will lose a tax-paying corporation. And vacant buildings never look good. None of those things are something to cheer about.
So if Augusta’s J.C. Penney doesn’t make the cut, I’m going to be a little sad, even though I rarely shop there.
I’ve got my fingers crossed. How about you?
SPEAKING OF STORES..: The new Catholic Social Services Thrift Store is set to open July 6 at its newly-renovated home at 3229 Wrightsboro Road.
After 20 years at its small Broad Street location, the thrift store will now occupy more than 17,000 square feet at the corner of North Leg and Wrightsboro roads — less than a mile east of the Augusta Mall.
The building has housed many things over the years, including a distribution center for The Augusta Chronicle. Now that the thrift store owns the building (it leased its previous location) it can renovate it exactly how it wants.
“Our new store, which has been renovated to fit our exact needs, will enable us to provide an unparalleled shopping and donating experience to our valued clientele,” says Philomena Mooney, thrift store manager. “This new, centralized location will allow us to provide an even stronger foundation of support to those in need throughout the community.”
Proceeds from purchases are used to support Catholic Social Services, a Diocese of Savannah-sponsored ministry that provides assistance to families and individuals in need throughout the Augusta metro area.
Hopefully, by July people will feel like getting out of their homes and going to stores again to buy something other than canned food and toilet paper.
LACKING CONFIDENCE: The COVID-19 pandemic has made us all pessimistic. Consumer confidence in Georgia has fallen 28.1 points since the beginning of the year, according to newly released Economic Intelligence data from research firm Morning Consult.
In January, Georgia’s consumer confidence index was 123.6. Then it began to plunge in April and plateau through early May, where the confidence level is at 95.5.
South Carolina’s consumer confidence data is very similar to Georgia’s. The Palmetto State went from 121 in January to 92.5 in early May.
“Despite a recent stabilization and rebound, consumers across all states remain less confident than in early March,” Morning Consult said. “The fall in confidence didn’t start with statewide shutdowns, and reopenings haven’t provided a boost.”
STAYING PUT: Home sales waned 17.8% in April according to the National Association of Realtors, continuing a two-month skid brought on the the coronavirus pandemic.
However, home prices have not wavered. The association reports that nearly all of the nation’s metro areas – 96% – saw home price growth during the first quarter of 2020.
Locally, home sales are slightly down, but prices are rising. According to the Greater Augusta Association of Realtors, 686 homes were sold in April. I don’t have the April 2019 report, but the March 2019 report shows 786 homes sold.
It’s not an apples-to-apples comparison, but it does show sales are down by roughly 13% compared to this time last year. However, the homes that were sold this April yielded higher prices than last year. The association reports the average sale price was $221,764 – a 21% increase from the $182,627 average sales price in March 2019.
Homes are selling faster, too. In April the average home spent 128 on the market. Last March, the average sale took 161 days.
PAYING ‘THE MAN’: Pandemic or not, you can’t get out of paying taxes. The best you can hope for is living in a low tax area. Fortunately, the fine folks over at SmartAsset have calculated which counties across the nation have the lowest and highest tax burdens.
Using a methodology based on income tax, sales tax, property tax, fuel tax and a host of other data, SmartAsset created a 0 to 100 index. The lower the number, the higher the tax burdent.
In the Peach State, the county with the lowest tax burden is the extremely South Georgia community of Echols County, whose index number of 70.12 ranks it No. 1 on the list for Georgia. The county with the highest tax burden is the heart of Atlanta – Fulton County, which ranks No. 159 in the state with an index of 51.50.
In our neck of the woods, Columbia County has the highest tax burden, with an index of 57.11 and a rank of No. 154. Richmond County fares better in the analysis with a tax burden index of 63.94 and a rank of No. 106. Burke County is a tax haven in comparison, with an index of 67.97 and the 19th lowest tax burden in the state.
On the other side of the river, Aiken County ranks No. 32 out of South Carolina’s 46 counties with an index of 71.73. Edgefield County’s 73.30 puts it No. 16 on the list of counties with the lowest tax burden. The county with the highest tax burden is…wait for it…Charleston County, whose index of 65.88 put it No. 46.
The national top 10 lowest tax counties is crowded with counties in Alaska, South Dakota and Texas.
The counties with the highest tax burden in the nation are where you would expect them to be: Northeast, the Upper Midwest and the West Coast.
Check it out for yourself if you get bored over the Memorial Day weekend.
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