Mergers & Acquisitions

Retail store expansion could get a boost from lower rents in the next 12 months as real estate investment trusts react to volatility in global financial markets, according to Pacific Investment Management Co.   In a report titled, “U.S. Real Estate: A Storm Is Brewing,” PIMCO portfolio managers John Murray and Anthony Clarke forecasted a drop of as much as 5% in commercial real estate prices due to a confluence of factors including public market volatility, tightened regulations, and uncertain foreign capital flows.

Michael O’Hanlon, who has been an executive with Wayfair Inc. for a decade, is transitioning to a new role with the company.   O’Hanlon has been named VP of government and industry relations. Previously Wayfair’s VP of corporate and business development since September 2006, O’Hanlon will now spearhead government relations strategy and ongoing collaboration with legislators, policymakers, regulators and other industry leaders at the federal, state and local levels.  

Watch out Best Buy, the nation’s largest ecommerce retailer is on your tail.   According to a report by barrons.com, Amazon has moved ahead of Walmart to take the number two spot, behind Best Buy, as the nation’s largest electronics retailer.    

J.C. Penney announced a positive development on the financial front.   The department store retailer announced it has successfully completed refinancing its $2.25 billion five-year senior secured term loans, which should generate about $24 million in interest expense savings.  

Macy’s longtime CEO, Terry Lundgren, will step down in the first quarter of 2017, to be succeeded by a company veteran.    Lundgren, who has been CEO of the department store giant since 2003,  is stepping down as the retailer finds itself challenged with a transformed retail landscape and changing consumer demands.  He will be succeeded by Jeff Gennette, 55, who was named president of Macy’s in 2014 after serving as chief merchandising office since 2009. 

Some things are easier said than done. And increasingly, that notion applies to closing stores.   Although analysts and investors say that retail companies need to continue to shrink their store portfolios, the decision to do has become increasingly complex for merchants, many of whom have already shed their most unprofitable locations, according to a CNBC report.  

Primark, one of Europe’s largest apparel retailers, will anchor a complete redevelopment of Macerich’s Kings Plaza in Brooklyn. It will be joined by Spain-based Zara, which the New York Times has called the world’s largest fashion retailer. The Sears store at Kings Plaza will close for renovation in September.  

Bed Bath & Beyond Inc.’s  first quarter profit  declined amid flat sales and  increased expenses that cut into its bottom-line.   The company’s profit fell to $122.6 million from $158.5 million in the year-ago period, less than analysts had expected.   Sales remained flat year-over-year at $2.74 billion, also below estimates. Same-store sales decreased 0.5%.