Here’s why the biggest U.S. mall owner might want to buy JC Penney

Simon Property Group might want to own bankrupt J.C. Penney in order to be able to redevelop some of its best real estate and make it even better, according to one analyst. 

“We believe Simon wants to control the J.C. Penney boxes and land so that it can ultimately redevelop many of these in order to densify and introduce mixed use elements,” Compass Point real estate analyst Floris van Dijkum said. “A redevelopment (that would require zoning approvals, capital, and time) could unlock significantly greater value while boosting traffic for the retail.” ...

Key Points
  • The biggest mall owner in the country is considering teaming up with Brookfield Properties and Barneys New York parent company Authentic Brands Group to make a bid for J.C. Penney, a person familiar with the talks told CNBC.

  • A real estate analyst walks through the logic of such a deal for Simon Properties’ business.

  • Hit by the coronavirus pandemic and suffering from an overhang of debt, Penney filed for Chapter 11 bankruptcy protection in May.

RSK: I totally agree...JC has many large boxes and they could become mini service centers or shops plus they have the one way escalators which can easily be retrofitted to make them 6 to 10 ft apart steps...maybe even some apartments retrofitted into those boxes.

Ken Notes: My crystal ball suggests Amazon will eventually have to buy a major chain that has failed to use as last mile distribution centers like the old catalogue stores. Amazon will get your item regardless of size (think refrigerators) to the Amazon store near you for free, how you get to your door step is up to you. Of course like Menards, Amazon will be glad to deliver it for a small fee.

- - Volume: 8 - WEEK: 28 Date: 7/7/2020 9:06:10 AM -