Old News: Goodbye to Gottschalks and Fortunoff

Isn’t it obvious it would turn out this way?

Gottschalks

On March 30, Gottschalks announced they were going to liquidate, extinguishing any hope the 105-year-old chain would continue to operate. We noted a few months ago that Gottschalks existed in a weird place–kind of a dowdy combo of Kohls and Macy’s, with mostly mall-based locations–and that their senior citizen-skewing product mix wasn’t likely to keep them afloat through their troubles. This all proved to be true, but another factor in their demise was some truly terrible bad luck: the store fleet for Fresno-based Gottschalks is concentrated most heavily in the areas most adversely impacted by the housing crisis of 2008. Central Valley cities like Modesto and Stockton have been struggling with year-over-year real estate declines upward of 50%, which is truly catastrophic for the families living there–try and imagine having your personal net worth decline by two or three hundred thousand dollars in just one year! I’m really not sure what I’d do in such a situation, but I can tell you one thing I probably wouldn’t do when faced with such a situation: go shopping at Gottschalks.

The double whammy for malls, of course, is that Gottschalks and Mervyn’s co-anchored many malls together. Some malls, such as Bakersfield’s East Hills Mall, didn’t even have another anchor aside from these two. This will spell doom for a great many of the centers lining California’s Central Valley, but also many other places throughout the west where both chains operated.

Fortunoff

The other story we forgot to follow up on–whoopsie!–is the equally-unsurprising failure of New York-based Fortunoff department stores. Like Gottschalks, we liked these guys just because they felt like a relic from another era, but “relic” and profitability don’t tend to go in the same sentence. The 2008 acquisition of the chain by NRDC Equity Partners–who helmed a successful turnaround of Lord & Taylor even in a bad economic environment (though this is now faltering, I’ve heard) and who also recently acquired Canada’s Hudson Bay Company–seemed to give these guys some hope. But ultimately their product mix and store fleet was perhaps too strange to survive in the current retail landscape. Their mostly mall-based, large stores leaned heavily towards housewares and jewelry but without any specific niche. They had neither the hip cachet of newer, smaller competitors like Crate & Barrell or West Elm nor the well-established legacy of larger old line stores like Macy’s or bargain prices of Best Buy and Wal-Mart, plus three of the four of their remaining stores were located in second-tier malls; one of them is even completely dead. What is sad about the loss of Fortunoff is that it’s a quirky regional chain that still remains well-loved; their imminent disappearance reminds me of New England losses from the ’90s and early 2000s like Apex, Ann & Hope, or Lechmere.

15 Responses to “Old News: Goodbye to Gottschalks and Fortunoff”

  1. Maybe the Fortunoff will reopen in its flagship (like FAO Schwarz). Don’t bet on though…

    [Reply]

  2. Fortunoff closed the brand new New York flagship first…after only being open there a year at best, so there’s not much hope of bringing it back.

    The new flagship (http://tinyurl.com/ddn4lr) looked promising, but it wasn’t as cool as the delightfully dated Fifth Avenue store (http://tinyurl.com/dj5mfr) it replaced. I always called the Fifth Avenue store the “Weezy Jefferson” store because it had a really late-Seventies feel with all the tinted glass, dark walls and chrome stripes along with the subdued lighting.

    [Reply]

  3. Actually, the NYC store was never considered the flagship. Westbury is and has always been the Flagship of Fortunoff, and is (by significant margins) the most active store in terms of sales.

    [Reply]

  4. The last Fortunoff store to open was a 180,000 square foot 3-story location in White Plains NY. The structure includes Whole Foods market, Morton’s stakehouse, Cheesecake Factory, a fitness club & meturnity clothing shop.

    Originally a Sacks 5th Avenue occupied that location at Bloomingdale Road & Maple Avenue. It closed in 2001, with construction of the current building in 2002. Acording to people in the mayors office the Fortunoff space maybe spoken for, but they are remaining mum as of now.

    [Reply]

  5. No! Not Gottschalks! Where will I get a tacky “It’s 5:00 somewhere” flag and dubious angel figurines!?

    [Reply]

  6. Fortunoff was such a unique store that will be greatly missed. And while I never visited a Gottschalks store, it sucks that there will be one less mid-range competitor for Macy’s.

    Another chain that I constantly worry about is Boscov’s. As a matter of fact, I’m surprised it is still in business.

    [Reply]

  7. :( Good bye Gottschalks! Shop at Macy’s! Shop Penney’s! Shop at Dillard’s! Dont make them the new Gottschalks! Save them!!!! Or else we’re going to end with Wal-Mart or Target!!! :(

    [Reply]

  8. since the woodbridge store is closing soon.what will go in its place.I was thinking bloomingdales would be good but not good for woodbridge center.there are a lotta thefts there at that mall.the theives would have a field day if that store ever opened there.I just dont know what will go in its place

    [Reply]

  9. I just got back from a Vacation in North California. I just wanted to share some pictures of Gottschalks in Vintage Faire In Modesto. What a wonderful store. Really reminded me of some of the older department stores of my childhood. A true dying breed. I only got shots of the third flood unfortunately. I thought I would share them with you all.

    http://s205.photobucket.com/albums/bb86/shortout/Gottschalks/?albumview=slideshow

    [Reply]

  10. While the loss of Fortunoff and Gottschalks is tragic, maybe mall REITs can develop their own department stores locally.

    [Reply]

  11. Something tells me we’re going to see a few more demallings and big-box anchors in the future.

    [Reply]

  12. The problem with big box anchors is they often demolish and rebuild anchors instead of moving in. Furthermore, the layout of them makes it awkward to refurbish after they leave.

    [Reply]

  13. That’s gotta suck for the East Hill Mall in Bakersfield, CA. Mervyns and Gottschalks were their only anchors. On top of that they have a lot of mom and pop stores, and the mall isn’t popular like the Valley Plaza.

    [Reply]

  14. Bad news for those hoping something cool would happen…Macy’s and Forever 21 are taking over lots of old Gottschalks.

    http://abclocal.go.com/kfsn/story?section=news/business&id=6837532

    …as if there aren’t enough of those stores.

    [Reply]

  15. I was reading about Gottschalks’ last gasp and this jumped out:

    “Boscov’s, an East Coast retailer with 39 department stores, bought some Gottschalks merchandise and was touting it in advertisements, Testa said.”

    Huh!

    http://www.fresnobee.com/local/story/1470983.html

    [Reply]

Leave a Reply


seven + 8 =