J.C. Penney said it will close 33 underperforming stores and lay off 2,000 employees as the venerable but troubled retailer continues a sweeping turnaround effort. Penney said the closings are part of its turnaround, which began in April when Myron (Mike) Ullman returned to lead the company. He’s largely undoing the strategies implemented by former CEO Ron Johnson, who was pushed out after an overhaul that included eliminating sales and promotions in favor of everyday low prices caused revenue to plunge.
Trepp reports that nine of the closing stores are part of CMBS. In eight cases, the J.C. Penney store is part of the collateral for the loan. Given that J.C Penney is part of 189 CMBS loans, the impact of these store closings is relatively small for CMBS investors.