Macy's Partnership With Brookfield Could Soon Lead To New Developments
Over two years after Macy's and Brookfield Asset Management went into business together, they might finally be approaching a tangible collaboration.
Macy's and Brookfield are planning to develop multiple new buildings on areas of the parking lot for the department store's Hawthorn Mall location in the Chicago suburb of Vernon Hills, the Daily Herald reports. A broker also posted 11 similar plots, mainly in the Northeast, for pre-development leasing in the past month, The Motley Fool reports.
Macy's entered into a strategic partnership with Brookfield in 2016, wherein the investment giant gained exclusive rights to potential development options at 50 properties Macy's owned or leased. Though mixed-use redevelopment has been a prevailing trend in shopping centers in the past couple of years, the Vernon Hills plan calls only for more retail to bring more traffic to that area of the mall.
Brookfield is experimenting with dense mixed-use redevelopment at mall properties it gained as part of its acquisition of GGP last summer, but has not committed to any such plans with Macy's locations. The 11 sites listed for leasing have not been confirmed as part of the Brookfield-Macy's partnership, TMF reports.
Though Macy's past couple of years have not been as dire as for its longtime competitor Sears, it still used sales of real estate to prop up its revenue in 2018, which it does not expect to continue in 2019, TMF reports. That could suggest that this particular well has run dry, as Macy's projected a major decline in 2019 earnings even as it reported better-than-expected performance in the fourth quarter.