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Does the new Woodlands IKEA mean the end of JCPenney is near?

In case you haven’t heard, the JCPenney at The Woodlands Mall will close early next year to make way for a brand-new IKEA. While this is likely welcome news for anyone on the Northside of town, it raises the question: how much longer does JCPenney have left? To answer that, we need to talk about when JCPenney started struggling. There are plenty of newer JCP stores around Houston. Throughout the 2000s, the chain grew steadily, moving away from malls and toward power centers. The stores drew in traffic by positioning themselves as more “middle of the road” than other department stores, and the sale of Eckerd helped free up cash. However, by about 2015, this momentum was slowing down. JCPenney had a few options, and the CEO at the time decided to push appliances and switch up its pricing model. These were some of its worst years, with appliance sales ending in 2019 and the company filing for bankruptcy in 2020. Hundreds of stores closed, outlet divisions shut down, and its long-time Texas HQ was abandoned. With the prospect of scores of malls having a new vacant anchor shortly after Sears had wound down operations, mall owners Simon and Brookfield stepped up to buy JCP. The new ownership has tried to right the ship, but JCPenney is still not doing great. In a time of flux for malls, it’s hard for mall owners to step up and invest. The JCPenney experience is no longer exceedingly special. While I don’t think we’re about to see a sudden implosion of either, I wouldn’t rule out a Sears-style wind-down, drawn out over many more years. At The Woodlands Mall, for example, the store seems to do decent business, but IKEA’s long-term prospects make more financial sense for Brookfield. Another potential course is a new buyer taking over JCP. While other investors, like fast-fashion retailer Shein, have stepped up to take a bite out of Simon and Brookfield’s ownership, no other retailer seems to be chomping at the bit to get a hold of Penney’s.