Circuit City Closing All 567 U.S. Stores
In a sign of the times, electronics retailer Circuit City has failed to find a buyer for its business and will close all 567 remaining U.S. stores. 30,000 people will lose their jobs.
In a bid to remain viable, Circuit City filed for bankruptcy last year, but a dismal holiday shopping season sealed the chainâ€™s fate. In addition to the job losses, the companyâ€™s failure is expected to hurt other sectors of the economy as well:
The Circuit City move will also hurt the nation’s malls, which have suffered from the rise in vacancies as other chains have liquidated. But analysts say that the demise of Circuit City, whose stores range in size from 20,000 to 25,000 square feet, will hurt the fortunes of mall operators even more.
“It will bring to market a glut of big box spaces across the country,” said John Bemis, head of Jones Lang LaSalle Inc.’s retail leasing team. “It will have one of the largest impacts on big box real estate across the country.”
Itâ€™s hard to imagine mall operators finding a way to lease those sizable stores during the economic downturn. Perhaps a few will become Best Buys. After all, the news of Circuit Cityâ€™s demise sent Best Buy shares up 9% today.