August 4, 2016
Inside of Macy’s traditional retail operations lies a few hidden gifts. The underlying real estate could be worth $10 billion to $30 billion, while online shopping could be contributing $3 billion to more than $6 billion, and its credit card business is worth about $8 billion to the retailer’s bottom line.
Macy’s is sitting on more than 100 million square feet of underutilized real estate assets, via ownership or long-term leases. If those assets were put into a REIT, it could generate roughly $1 billion in annual notional rental.
Macy’s continues to experience decreased sales and earnings numbers, with net earnings of roughly $1 billion for the past 12 months. Management is working to get fixed costs in line with lower income by closing stores and trying new concepts, while adjusting to competitive challenges and consumer shifts to e-commerce.
For comments, questions or concerns, please contact Dennis Kaiser