Business
3:26 pm
Tue January 4, 2011

Macy's To Close Highland Mall Store In Latest Blow To Shopping Center

Calling it an "underperforming" location, Macy's has announced it is closing its struggling Highland Mall location and eliminating 125 jobs.

"Associates displaced by the store closing may be offered positions in nearby Macy’s stores where possible," Macy's said in a statement you can read below. "Regular full-time and part-time associates who are laid off due to the store closing will be provided severance benefits and outplacement assistance."

Macy's says a final clearance sale at the Highland Mall store will begin on Sunday will run for about ten weeks.

The closure of an anchor store like Macy's can spell bad news for smaller businesses in Highland Mall that rely on large department stores to bring in traffic.  KUT News reported in October that the mall was only 60 percent occupied.

Dillard's, the mall's other anchor store, has been trying to get out of its lease, and Highland Mall has been fighting to prevent that from happening. Austin Business Journal reporter Francisco Vara-Orta reported that the process is essentially on hold until January 28.

U.S. Magistrate Judge Andrew Austin ordered that discovery — a legal term used to describe the period of time before a trial when one side can obtain evidence from the opposing party such as requests for documents or depositions — be reopened until Jan. 28, 2011. The judge said the mall’s legal counsel can get up to four more depositions while Dillard's can get as many as it wants. Highland Mall’s counsel will then have until Feb. 18, 2011 to file its final response to Dillard’s request that a judge grant its request to break its lease.

The Highland Mall is a sad shadow of its former self. Once a popular shopping destination in the 1980s, the mall has lost many of its tenants and is described by various reviewers on Yelp as a "CreepyTown" that is "in its death throes" like "a mall you see in a horror movie."

The City of Austin is trying to revitalize the Airport Boulevard corridor, a drab stretch of road with few public amenities that is punctuated by pawn shops and a few iconic businesses like Lammes Candy's. As we reported in October, the city hired a planning team to rewrite the rules for Airport Boulevard development.

The aim is a familiar one: to make the streets denser and more pedestrian friendly, but the method is a new one in Austin. Traditional zoning will be rejected in favor a new approach called “form-based codes.” Dan Parolek co-authored a book on the subject.

“Conventional zoning code is organized around uses, separating uses like, commercial residential office,” Parolek  told KUT News. “And a form based code because its dealing with a very complex mix use environments takes a step back and says what is the character and the look and feel of the kind of place you’re trying to create.”

Here is the complete press release from Macy's corporate headquarters in Cincinnati.

Macy’s is closing its store in Highland Mall in Austin, TX.  Associates at the store were notified on Tuesday (Jan. 4).

The closing is part of an ongoing annual process by Macy’s, Inc. to selectively prune underperforming locations while also opening new ones to fill gaps in local markets. This allows the company to maintain a healthy portfolio of stores as customer preferences and shopping patterns shift over time.

A final clearance sale at the Highland Mall store will begin on Sunday, Jan. 9 and will run for approximately 10 weeks.

Macy’s is committed to treating affected associates with respect and openness. Associates displaced by the store closing may be offered positions in nearby Macy’s stores where possible. Regular full-time and part-time associates who are laid off due to the store closing will be provided severance benefits and outplacement assistance.

About 125 associates work at the Highland Mall store. The store, with 225,000 square feet, was opened as a Foley’s in 1979 and converted to the Macy’s nameplate in 2006. The company owns the store and is in the process of selling the property.

Macy’s is closing a total of three stores at this time (the other two are in Chestnut Hill, MA, and Union City, GA). After the closings, the company will operate 806 Macy’s stores across the country.

After the closing of Highland Mall, Macy’s will operate three stores in the Greater Austin area. A Macy’s store at The Domain, which is located about six miles from Highland Mall, was opened in 2007.