Seattle-based retailer Nordstrom said Wednesday it will close two stores in the Portland area because sales have failed to meet expectations.
Its stores at Portland’s Lloyd Center and nearby Vancouver Mall will close in January 2015.
“These two locations just haven’t performed to the level we need them to, and investing in remodels to possibly make them more successful doesn’t pencil out,” Erik Nordstrom, the company’s president of stores, said in a statement. “We never like to close a store, but we came to the difficult conclusion that it doesn’t make good business sense to continue operating them after our agreements end.”
The company still will have three full-line stores and four discount Rack stores in the Portland area.
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The planned closures affect about 220 employees at Lloyd Center and 164 employees at Vancouver Mall. Those who want to stay on with Nordstrom likely will be able to find a position at the remaining stores, the company said.
In a phone interview Wednesday, Erik Nordstrom said the Lloyd Center store opened in 1960, followed by the Vancouver store in 1977, a time when “we were a Northwest company.” Today, the retailer operates 260 stores in 35 states, including 117 full-line Nordstroms and 140 Racks.
The company continues to invest in its Portland-area stores, with a one-floor remodel of its downtown location scheduled for 2014, Erik Nordstrom said.
It also has stores at the Washington Square and Clackamas Town Center malls. The Washington Square store was remodeled in 2010, and the Clackamas location is set for renovations “in the near future,” according to Nordstrom.
The last time the company closed a store was two years ago in Orem, Utah. All told, it has closed six stores since 1990 and has no plans for additional closings, he said.
“Once a year, we review potential store closings, and it’s not a long list. All of our stores are profitable,” he said. “I don’t see us going backward in store count at all.”
In fact, the company plans to open 27 new Racks and three full-scale stores in 2014, including the first of six Canadian locations.
It has performed well despite a difficult economy by expanding its online presence, catering to cost-conscious consumers through its discount Rack division, and investing in new markets such as Manhattan and Canada.
The company reported in November that its third-quarter sales rose 3 percent to $2.88 billion, while its profit fell nearly 7 percent to $137 million, mostly because its Anniversary Sale was held earlier in the year.
While Wednesday’s announcement was a tough decision, said Erik Nordstrom, it “really is a normal course of operating stores.”
“Our stores are different than they were 10, 20, 30 years ago,” he said. “Malls change. Markets change and how customers shop change.”
Jennifer Black, a Lake Oswego, Ore., retail analyst who advises large institutional investors, said she wasn’t surprised by the store closings given their locations.
“Both of those malls are not A-plus malls. They’re not destinations for the Nordstrom customer,” Black said. “I have to applaud the company. They’re doing the things they need to do to enhance shareholder value.”
Amy Martinez: 206-464-2923 or firstname.lastname@example.org. On Twitter: @amyemartinez