Openings, Closings, & Other Key Industry Highlights

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December 16, 2020


November Retail Sales Report

November U.S. retail sales remained soft, falling 1.1% from the prior month, which was revised down to 0.1% or by 40 bps. Given that both September and October were revised down, we have increasing concern about the strength of the holiday season this year. Still, these results were significantly better than November, corroborating commentary from retailers about the pull forward of holiday sales into October; this was due in large part to the delay of Amazon Prime Day and highlights the decreasing importance of Black Friday weekend sales. In-store traffic dropped 20-50%, depending on the retailer, partially offset by strong digital sales. Cyber Monday, which fell on November 30th, had its best year with sales reaching $10.80 billion, a 15% increase. Non-store sales, predominantly online sales, rose 20 bps in November from October, but nearly 30% from last year, lifting sales at Amazon, Wayfair, Etsy, and Shopify’s stores. Click here to request a Special Analysis Report.


On December 14, Bed Bath & Beyond announced the sale of Cost Plus World Market to private equity firm Kingswood Capital Management, though no pricing was disclosed. The Company is selling all of Cost Plus’ 243 stores, its digital business, two distribution facilities, and its corporate office. The deal is expected to close in February 2021.

This transaction highlights management’s continued focus on monetizing non-core assets, allowing it to better concentrate on the central brand and improve its liquidity position. Click here to request a list of store closures.


Ahold Delhaize's Food Lion chain has invested $212.5 million to upgrade 112 stores across Delaware, Maryland, Pennsylvania, Virginia, and West Virginia.Why? Approximately 40% of these remodeled stores now offer Food Lion To-Go, its grocery pickup service. Food Lion now has remodeled more than 90% of its current store network of more than 1,000 stores across its 10-state operating area. Click here for a list of Ahold Delhaize future openings and closings.


In the J.C. Penney bankruptcy case, the Debtors filed preliminary lists of unexpired leases to be assigned to OpCo (an entity controlled by Brookfield Asset Management and Simon Property Group) and PropCo (a newly-formed entity), subject to designation rights. The OpCo list (click here to request the list) includes 183 leases comprised of stores, distribution centers, and office facilities; the PropCo list (click here to request the list) includes 11 store leases and one parking facility. The Debtors also identified 16 additional leases that they seek to reject (click here to request the list). Yesterday, OpCo and PropCo notified the court that they are still in discussions with certain landlords regarding the potential assumption and assignment, or rejection of unexpired leases.


Starbucks announced plans to have 55,000 stores in its global fleet by 2030, up from its current store count of 33,000. The Company believes that by flooding the market with new types of stores, including smaller locations and ones with drive-thru and curbside pickup, it will be able to remain competitive. COO Roz Brewer said that “though we are growing off a large base, there is ample room to expand in regions where the Starbucks brand is less penetrated.” The current base of stores is weighted toward “high volume, high margin, suburban drive-thrus.”

In other news, Starbucks appointed Mellody Hobson as it new non-executive chair of the board, effective March 2021, when the Company holds its annual shareholder meeting. Ms. Hobson has served on Starbucks’ board since 2005, and was previously appointed independent vice chair in 2018. She will succeed current Chair Myron Ullman, who is retiring. Ms. Hobson is the co-CEO of Ariel Investments, LLC, a global asset management firm, and also serves as a director of JPMorgan Chase. She previously served as a director of Estee Lauder Companies and chair of DreamWorks Animation until its sale in 2016. Click here to request a list of future store openings.


Publix Super Markets recently opened a new 48,000 square-foot prototype in Tampa, FL that borrows design elements from some of the Company’s other formats, particularly its GreenWise banner, and combines them into one new format. The store contrasts Publix’ recent strategy to open smaller formats of about 30,000 square feet. Click here to request a list of future store openings.


Meijer President and CEO Rick Keyes announced the Company recently opened five supercenters across the Midwest. The new 159,000 square-foot stores are located in Manitowoc, WI; Sycamore, IL; Bad Axe, MI; and Brimfield and Lorain, OH. Click here to request a list of future store openings.


Walmart has reportedly hired Goldman Sachs to explore an initial share sale of its Flipkart unit to raise around $10.00 billion. The Company is planning to sell around 25% of India’s largest online retailer in the U.S. Walmart now owns an 82.3% stake in Flipkart, with U.S.-based hedge fund Tiger Management, China’s Tencent, Accel Partners and Microsoft Corp., among the other key investors. The IPO will offer an opportunity to minority investors to sell or pare their holdings. If Flipkart’s IPO plans are successful, it will be the largest by a company based in India on overseas exchanges. Flipkart’s valuation will also more than double to $40.00 billion since its acquisition by Walmart. In September, it was reported that Flipkart will go public in 2021. In July, Flipkart raised $1.20 billion in a fresh funding round, with Walmart as the lead investor, valuing the company at $24.9 billion. Click here for a list of future openings.

In other news, Walmart will expand its pilot program with Gatik’s autonomous box trucks, already underway for more than a year, to operate a two-mile route between a distribution center and a Walmart store in Bentonville, ar.

Walmart Canada is leveraging the DL Freight enterprise blockchain solution from Toronto-based DLT Labs to streamline its supply chain invoicing process. The DL Freight rollout is part of Walmart Canada’s larger $3.50 billion initiative to transform stores, digital operations, and technology.


Target signed a lease for a 27,000 square-foot space in the Soho neighborhood of Manhattan. The space is currently occupied by a New York Sports Club. Target is planning to open at least 15 stores across New York State, including locations in Yonkers, Times Square, and Washington Heights. Click here to request a list of future store openings.


Costco continued the parade of strong mass merchandiser reporting, turning in another solid quarter. For 1Q21, revenue surged 17%, with comps up a similar amount. All three reporting segments, the U.S., Canada, and International reported comps up in the mid-teens. Electronics, gym equipment, and major appliances were big sellers. The digital platform also drove sales, expanding 86% during the quarter. Gross margin saw some modest improvement, up about 50 bps on less spoilage and better productivity. SG&A margin stayed relatively flat despite just over $200.0 million in COVID-19 related costs, which were mostly compensation related. The performance positively impacted the bottom line, with net income growing 38%. Click here to request a list of future store openings and closings.


Rouses Markets recently opened a new store in South Lake Charles, LA. The 44,000 square-foot opening was delayed (originally planned to open in October) due to the coronavirus outbreak and Hurricanes Laura and Zeta. The new store offers curbside pickup and delivery. 


Dollarama’s 3Q sales increased 12.3% to C$1.06 billion, driven by net new store growth of 62 over the past year (bringing its total store count to 1,333 stores as of November 1), and 7.1% comp growth that consisted of a 26.3% increase in average transaction size and a 15.2% decrease in the number of transactions. Comp growth resulted from higher sales of summer and other seasonal items as well as household essentials, health and beauty, and cleaning products, partially offset by lower in-store traffic and lower sales of certain product categories, such as party supplies and greeting cards. EBITDA increased by 14.2% to $312.1 million; operating income rose by 15.1% to $243.8 million.


In the Guitar Center bankruptcy case, the Debtors filed a motion to reject 11 unexpired leases. Please click here to request the list.

In other news, Guitar Center priced $350.0 million of 8.5% Senior Secured Notes due 2026 (increased from $335.0 million). The offering was expected to close December 15. 


Party City entered into a definitive agreement to sell a substantial portion of its international operations (Amscan International) to Endless LLP, a U.K.-based private equity investor, for approximately $59.0 million. The business being sold includes Party City’s international wholesale, retail and e-commerce businesses in the U.K., Ireland, Germany, Australia, New Zealand, and Asia, which operate under a number of trade names including Amscan International, Party Delights, and Livario, as well as several website brands in Europe. The transaction is expected to close in the next several weeks.

As part of the agreement, Party City and Amscan International will also form a joint venture partnership for Party City’s costume sourcing and manufacturing business in Asia, currently part of Amscan Asia. Party City will retain its other existing sourcing operations. Click here to request a list of store openings and closings.


Murphy USA, which operates about 1,500 gas station and convenience store locations across the Southwest, Southeast and Midwest, has agreed to acquire QuickChek for $645.0 million. QuickChek operates 157 stores throughout central and northern New Jersey and the New York metro area. Murphy will finance the deal using cash on hand, existing credit facilities, and new debt. The purchase price includes $20.0 million in expected tax benefits. The deal is expected to be earnings accretive in 2022, the first full year of combined operations, with annual run rate synergies of $28.0 million expected by the third year. The acquisition is expected to close in 1Q21.


In the ascena retail group bankruptcy casethe Debtors filed a motion to reject additional unexpired leases. On December 8, the Court entered an order authorizing the going concern sale of the Ann Taylor, LOFT, Lane Bryant, and Lou & Grey brands to Premium Apparel LLC, an affiliate of private equity firm Sycamore Partners, for approximately $1.00 billion ($540.0 million and the assumption of certain liabilities). The transaction, which could close by next week, includes approximately 900 stores. As of late August, ascena operated 1,500 retail locations throughout the U.S., down from a previous high of approximately 2,800 stores. Click here for a list of store closures.