Barneys New York is closing a store on Broadway between 75th and 76th Streets on the Upper West Side of New York City, a store manager confirmed to neighborhood real estate blog West Side Rag.
The store, one of three in the city and smaller than the other two, will close Feb. 18, according to the report. Corporate headquarters did not respond to a request for comment from the West Side Rag.
The company, which is under private ownership and has changed hands several times at the start of the century, renovated the closing location in 2013. A new location opened two years ago in the city’s Chelsea neighborhood, according to Fortune.
Like many of its department store peers, Barneys has worked to upgrade the concept of a department store and was actually ahead of many in forging a shoppable Instagram page back in 2015. But much like an injured baseball player, the company was traded several times among private equity firms and now seems to have gained control over an overwhelming debt load.
While department stores in general are under pressure, Barneys does have some advantages over its larger rivals. In general, several rely on outmoded formats and supply chains that aren’t keeping pace with customer demand, and their margins are being hammered by the higher costs of e-commerce, according to a report last year from Moody's Investors Service. Moody’s analysts estimated a 9.3% operating income decrease for the department store sector last year and another 2.7% decrease in 2018.
That, plus over-expansion (which has Macy's, for one, drastically reducing its store count), has some players on the ropes. Bon-Ton filed for bankruptcy protection earlier this year. Neiman Marcus is watching losses widen, and Hudson's Bay's sales are falling as it fights off activist pressure to unlock value in its real estate.
But Barneys, leaner and possibly nimbler, has reaped the benefits of being a luxury retailer with just a few locations, almost exclusively in downtown centers of larger cities. Barneys has also worked to rationalize its assortment to differentiate its merchandise and avoid heavy discounts. Two years ago, for example, the company offered 41% fewer new handbag lines over the holidays, after boosting its assortment by 46% the previous year.
The company, like many department stores, has also seen sales rise in its off-price Barneys Warehouse unit. Under private ownership, it’s not clear how Barneys is doing these days, although Fortune in 2016 declared the company had staged "a remarkable comeback." That year, the company opened a store on the same block in lower Manhattan where its flagship stood for three quarters of a century.