Macy's Filling Former Central Valley Gottschalks

SAN FRANCISCO-Macy’s said Thursday it will open stores this fall in former Gottschalks locations in the Central Valley cities of Fresno and Visalia. A bankruptcy judge on Wednesday approved Macy’s winning auction bid for the assets, the same day it approved Forever 21′s purchase of 13 other Gottschalks leaseholds. Gottschalks filed for Chapter 11 bankruptcy in January and is in the last scheduled month of a going-out-of-business sale for its 58-store chain.

Macy’s leaseholds are located in River Park in Fresno (107,000 square feet; built in 2004; owned by River Park Properties II) and Visalia Mall in Visalia (150,000 square feet; built in 1995; owned by General Growth Properties). Both are expected to be renovated and opened prior to the 2009 holiday selling season, according to Macy’s.

Macy’s paid $500,000 to assume the Fresno lease, which commenced in July 2004, and $1.5 million to assume the Visalia lease, which commenced in November 1994. The bids were placed on May 28 during an auction, but had to be approved by a bankruptcy court judge. Macy’s's is not revealing the term and rate on the leases and the information was not otherwise immediately available.

Cincinnati-based Macy’s operates approximately 840 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy’s and Bloomingdale’s. The company also operates macys.com and bloomingdales.com. Prior to June 1, 2007, Macy’s was known as Federated Department Stores. The company generated $24.9 billion in sales in 2008.

Forever 21, a Los Angeles-based clothing store geared toward younger women, will assume the leases on 13 other properties. The leaseholds include space at Fresno Fashion Fair mall, the Hanford Mall and various other stores throughout Central and Northern California, and in Anchorage, Alaska.

Gottschalks operates 58 department stores in California, Washington, Alaska, Oregon, Idaho and Nevada under the Gottschalks and Village East names. Information on the future of the remaining 43 locations was not immediately available.