noembed noembed

Commentary, sarcasm and snide remarks from a Florida resident of over thirty years. Being a glutton for punishment is a requirement for residency here. Who am I? I've been called a moonbat by Michelle Malkin, a Right Wing Nut by Daily Kos, and middle of the road by Florida blog State of Sunshine. Tell me what you think.

Friday, June 24, 2005

Winn Dixie Store Closings an opportunity?

Earlier this week the Super market chain announced they were closing over 300 of their stores as part of the company's re-organization attempts after filing for bankruptcy. Five stores are being closed in Palm Beach County where I live.

The Sun-Sentinel article I'm going to post below quotes some people who think store closings could be good for the shopping centers involved. I take the exact opposite position. I live less than a half mile from a shopping center where there used to be both a Zayres/Ames Store and a Winn-Dixie. The first closed for business in 1990, the later in 1992. The shopping center died not long afterwards. At its nadir I doubt 30% of the space in this shopping center was occupied. The place was a ghost town. Only till recently when a Cuban Super market opened has the place perked up again. The old Ames store is still vacant 15 years later.

With plenty of office and shopping center space available I don't see any of the store closings in Palm Beach County being beneficial to the shopping centers involved. I know both the Gun Club and Sandalfoot locations well. The Winn Dixie store is the main draw there. Without it the other businesses will face rocky times. That's my prediction.

The entire Sun Sentinel article can be found at-,0,3609350.story?coll=sfla-business-front

By Yolanda Sanchez
Business Writer
June 24, 2005

After Winn-Dixie Stores Inc. announced Tuesday that it is closing 326 stores, nine in South Florida, the question remains: What will happen to these locations?

Although these locations did not fare well for Winn-Dixie, which succumbed to competition from grocery giants such as Publix Super Markets and Wal-Mart Superstores, some think that profit is possible for other companies.

"One person's misfortune is someone else's fortune and this is going to be an opportunity for someone to do something that is profitable," said Seth Werner, chief executive officer of Cypress Creek Capital, a Fort Lauderdale-based real estate investment banking company. "My guess is that another `big box' user would take it over, such as an LA Fitness."

As part of the supermarket's bankruptcy reorganization, Winn-Dixie has to shed leases at these sites. It has already received offers for 135 of the 326 stores for sale, said Stephen Bittel, founder of Terranova, a commercial real estate advisory firm based in Miami Beach.

Winn-Dixie has employed The Blackstone Group, an investment and adviser firm focusing on companies in distressed situations, The Food Partners, a Washington-based investment banking firm to the food industry, and DJM Asset Management LLC, a real estate consulting and advisory firm based in New York, to assist in the company's marketing efforts, said Joanne Gage, vice president of advertising and marketing for Winn-Dixie. The firms, however, would not comment or could not be reached regarding their involvement with Winn-Dixie.

The fate of employees, however, is not so easy to determine. "That decision is driven by the use of the location," Bittel said.If the location continues as a grocery store, the likelihood of employees being kept is more probable than if the location is used as another business, Bittel added.

Because Winn-Dixie filed for bankruptcy, it has the option to reject its leases or perform what is called an assume and assign, said Howard Berlin, managing director of Kluger, Peretz, Kaplan and Berlin, a Miami firm specializing in bankruptcy and other areas.

If Winn-Dixie rejects its leases, it will have to pay claims connected with those leases under a plan approved by the court. It can also assume and assign the lease to another company to reduce or eliminate the debt or sell it for a profit.

Listed on BlogShares