CINCINNATI--(BUSINESS WIRE)--Macy’s, Inc. (NYSE:M) today announced it has sold the top four floors (levels five through eight) of underutilized space in its downtown Seattle store, located at 300 Pine Street, to a controlled affiliate of Starwood Capital Group to be converted to office use.
The Macy’s store will remain open and operating, with space reconfigured by fall 2016 to accommodate all existing merchandise categories in a more efficient manner. Selling space will be reduced from 363,000 square feet on seven floors (the lower level plus floors one through six) to 283,000 square feet on five floors (the lower level plus floors one through four).
“Macy’s on Pine Street is a very successful business serving a thriving community of downtown residents and workers,” said Terry J. Lundgren, Macy’s, Inc. chairman and chief executive officer. “Our vision is to make the store easier and quicker to navigate while also attracting new jobs and economic activity to space that has not been fully utilized in recent years. While there will be some construction activity inside the store over the next year, we expect to continue to serve customers without interruption.
“This transaction is an example of the company’s ongoing efforts to enhance shareholder value by identifying and pursuing strategic real estate dispositions while maintaining the flexibility we require to run a successful business,” he added.
Macy’s 265 current downtown store associates will remain in place, although some may be reassigned as departments are respaced.
Macy’s downtown Seattle building, with a total of 864,000 square feet, was opened in 1929 as The Bon Marche. The nameplate converted to Macy’s in September 2006.
The purchase price for the four floors, totaling more than 300,000 square feet, was $65 million in cash. Macy’s, Inc. will record a gain of approximately $60 million in the third quarter of 2015. The gain was originally anticipated and included in 2015 earnings guidance previously provided by the company although it is being booked a quarter earlier than expected.
About Starwood Capital Group
Starwood Capital Group is a private investment firm with a core focus on global real estate. Headquartered in Greenwich, CT, the firm maintains 10 offices in four countries around the world, and currently has more than 1,400 employees. Starwood Capital Group has raised approximately $32 billion of equity capital since its inception in 1991, and currently manages over $45 billion in assets. The Firm has invested in virtually every category of real estate on a global basis, opportunistically shifting asset classes, geographies and positions in the capital stack as it perceives risk-reward dynamics to be evolving. For more than two decades, Starwood Capital Group and its affiliates have successfully executed an investment strategy that involves building enterprises around real estate portfolios in both the private and public markets. Additional information can be found at starwoodcapital.com
About Macy’s, Inc.
Macy’s, Inc., with corporate offices in Cincinnati and New York, is one of the nation’s premier retailers, with fiscal 2014 sales of $28.105 billion. The company operates about 885 stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy’s, Bloomingdale’s, Bloomingdale’s Outlet, Macy’s Backstage and Bluemercury, as well as the macys.com, bloomingdales.com and bluemercury.com websites. Bloomingdale’s in Dubai is operated by Al Tayer Group LLC under a license agreement.
All statements in this press release that are not statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of Macy’s management and are subject to significant risks and uncertainties. Actual results could differ materially from those expressed in or implied by the forward-looking statements contained in this release because of a variety of factors, including conditions to, or changes in the timing of, proposed transactions, prevailing interest rates and non-recurring charges, competitive pressures from specialty stores, general merchandise stores, off-price and discount stores, manufacturers’ outlets, the Internet, mail-order catalogs and television shopping and general consumer spending levels, including the impact of the availability and level of consumer debt, the effect of weather and other factors identified in documents filed by the company with the Securities and Exchange Commission.
(NOTE: Additional information on Macy’s, Inc., including past news releases, is available at www.macysinc.com/pressroom).
