The consumer electronics retailer announced this week -- along with dismal December sales -- it will close eight unprofitable stores over the next two months, including five of its 14 stores in Washington and Oregon. The news comes two weeks after GlobeSt.com broke news that Good Guys has brokers marketing nine of its leases in the two states and would be closing stores as sublease tenants were secured.
The stores to be closed are in Tacoma, Federal Way and Silverdale, WA; Clackamas and Airport Way in Portland, OR; Pinole and West Covina, California; and Maryland Parkway in Las Vegas, NV. "These low-volume stores account for a significant portion of the company's losses; excluding these stores Good Guys is cash-flow positive year-to-date,'' says Kenneth R. Weller, Good Guys chairman and chief executive officer. "Good Guys is also pursuing improved lease terms at a limited number of additional stores and expects to reach a satisfactory conclusion to these matters in the near future."
Good Guys, with annual sales of $800 million, says it will continue to operate 71 stores, including 59 stores in California, three stores in Nevada and nine stores in Washington and Oregon. The question is for how long -- a question, of course, not being answered. The company did not return phone calls seeking comment.
The brokers hired to market the company's Northwest leaseholds --Michael Heerman of HSM Pacific in Portland and Nitya Nadesan of Seattle Pacific Realty -- were hired to find takers for nine of the 14 locations, not just the five Good Guys now says will close. The brokers have declined comment on (1) whether the closings are occurring because they have found sublease tenants for the five locations or simply because Good Guys will lose less money just paying rent on a vacant building, and (2) whether they are continuing to seek sublease tenants for the other four locations.
The only Portland leasehold the brokers were not asked to find takers for is the one in Tigard. The three Washington locations Good Guys definitely wants to keep are located in Bellevue, Lynwood and Southcenter. Most of the Good Guys locations are right around 20,000 sf.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
