Amazon and Mall Operator Look at Turning Sears, J.C. Penney Stores Into Fulfillment Centers

The largest mall owner in the U.S. has been in talks with Amazon.com, the company many retailers denounce as the mall industry's biggest disrupter, to take over space left by ailing department stores. From a report: Simon Property Group has been exploring with Amazon the possibility of turning some of the property owner's anchor department stores into Amazon distribution hubs, according to people familiar with the matter. Amazon typically uses these warehouses to store everything from books and sweaters to kitchenware and electronics until delivery to local customers. The talks have focused on converting stores formerly or currently occupied by J.C. Penney and Sears, these people said. The department-store chains have both filed for chapter 11 bankruptcy protection and as part of their plans have been closing dozens of stores across the country. Simon malls have 63 Penney and 11 Sears stores, according to its most recent public filing in May. It wasn't clear how many stores are under consideration for Amazon, and it is possible that the two sides could fail to reach an agreement, people briefed on the matter said. The talks reflect the intersection of two trends that predate the pandemic but have been accelerated by it: the decline of malls and the boom in e-commerce. Malls were struggling for years, as more customers stayed home to shop online. The spread of the coronavirus, which forced malls to temporarily close and limited their crowds even after reopening, has worsened the situation. Amazon, meanwhile, was able to navigate new logistical challenges during Covid-19 and recently reported its greatest quarter ever. For Amazon, a deal with Simon would be consistent with its efforts to add more distribution hubs near residential areas to speed up the crucial last mile of delivery.Read more of this story at Slashdot.
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