A deal to sell JCPenney stores in the Chicago area and in dozens of other states includes two of the chain’s best performers, in Mokena and Orland Park, according to companies involved in the transaction.
The sale of the chain’s stores in 35 states includes Chicago-area locations in North Riverside and Vernon Hills along with Mokena and Orland Park.
Not part of the deal with Onyx Partners are JCPenney stores in Calumet City and Matteson.
The Calumet City store is part of River Oaks Center, which also counts Macy’s as an anchor. JCPenney has a standalone store in Matteson on a perimeter road southeast of U.S. 30 and Cicero Avenue that once encircled Lincoln Mall, since demolished. Penneys had been an anchor at that mall.
As part of the department store chain’s 2020 bankruptcy, Copper Property CTL Pass Through Trust was created to take control of 160 JCPenney retail properties and six warehouse distribution centers, with the intent to sell. The deal with Onyx Partners includes 119 of those stores.
Hilco Real Estate is manager of Copper Property and it, along with real estate firm Newmark, were involved in what Neil Aaronson, principal executive officer of Copper Property, described to investors Monday as an “exhaustive marketing and sale process.”
After a marketing effort that started in February, the evaluation of offers showed that “Onyx clearly stood out as our preferred buyer,” Aaronson said on Monday’s conference call.
Onyx is paying $947 million in cash for the portfolio, with the sale expected to close by Sept. 8. Copper Property had announced the sale July 25.
In marketing materials Hilco distributed in February for the JCPenney portfolio, the Orland Park store, in Orland Square shopping center, was identified as 10th highest in the chain for estimated 2023 sales, at $15 million.
In identifying top-performing stores in the portfolio to potential buyers, Hilco noted the Mokena store, off U.S. 30 and Wolf Road, had the eighth-highest average household income in a 3-mile radius of all stores in the portfolio.
The Mokena store had, at the time the marketing materials were issued, average household income of just under $162,000 within three miles. The JCPenney in Vernon Hills was the fourth-highest in the same category, with an average household income of a bit more than $171,000, according to Hilco.
It was not clear whether all of the stores that are part of the sale will remain open in the long term, but Orland Park Mayor Jim Dodge said Thursday he believed the Orland Square store would stay in business.
Dodge said he has been in regular contact with Simon Property Group, owner of the mall, and that “they’ve confirmed that the Orland Square mall location is performing well, and we remain optimistic it will stay in their portfolio.”
Mall owners Simon Property Group and Brookfield Property Partners own the Penneys chain, having purchased it out of bankruptcy.
The department store chain, based in Plano, Texas, filed for Chapter 11 bankruptcy protection in mid-May 2020.
It was one of the largest retail bankruptcies as the COVID-19 pandemic, still in its infancy at the time, took a toll on businesses having to close temporarily as they were viewed as nonessential stores, as opposed to supermarkets and pharmacies.
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As part of its bankruptcy reorganization, Penney said it planned to permanently close nearly a third of its 846 stores within two years.
In August 2023, JCPenney said it planned to spend more than $1 billion by the end of 2025 on improvements such as store remodels, upgrading its online shopping site and app, and making its supply network more efficient so that online orders are delivered more quickly.
The Associated Press contributed.