San Fernando Seeks Solution to J.C. Penney Closure

Weeks after J.C. Penney Co. announced plans to close its San Fernando location, property owner Severyn Aszkenazy, city officials and other advocates are making a last ditch effort to convince the retailer to keep its store. The group has made several efforts to retain the retail anchor in the past — including offering lower rent — however those attempts were unsuccessful. Earlier this month, J.C. Penney said it plans to close the 60,000 square-foot store, located near the corner of San Fernando Road and San Fernando Mission Boulevard, effective July 28. A company spokesman could not be reached for comment as of press time. Aszkenazy, who owns the department store property, said he and others are putting together a retention proposal that includes an agreement to renovate the space, so it fits in with J.C. Penney’s revamped brand. While he has not yet marketed the property, Aszkenazy said, in the past, other retailers have expressed interest in occupying the space. He declined to name the retailers, but said, “No one (has been) as valuable as J.C. Penney.” The store has been located in San Fernando since 1920. The closure is “essential in helping us achieve our long-term goals,” J.C. Penney’s spokesman, Joseph Thomas, said in an e-mailed statement earlier this month. “We would not have moved forward with this difficult decision if we did not believe it was absolutely necessary for the future growth of our company.” Employees of the San Fernando store were notified of the upcoming closure on May 31, Thomas said. The company plans to assist employees in identifying opportunities at nearby J.C Penney stores, which include Lancaster, Northridge, Glendale, Burbank, Santa Clarita, Thousand Oaks and Simi Valley. Eligible employees who do not remain with the company will receive separation benefits. The company has no plans to close other locations in California, Thomas said. In addition to the 50 workers employed by the retailer, the closure of the downtown anchor will have a substantial impact on the residents, city officials said. Julian Ruelas, project manager for consulting company Brookwood Group and a freelance consultant for San Fernando businesses, has discussed with Aszkenazy ways to address the issue. “Basically we’re saying ‘J.C. Penney, you invest in us and we’ll invest in you,’” Ruelas said. “I hope it’s not too late.” Although his focus is retaining J.C. Penney, Aszkenazy said he has alternative ideas for the use of the space after the retailer departs. City officials also are working to identify tenants that could be a suitable replacement mall anchor. City Administrator Al Hernandez said retailers such as Kohl’s, Marshall’s and Forever 21 are among those that could be a good fit for the space. The retailer must have a value-driven product selection that appeals to the community, he said. Local residents, meanwhile, have voiced their reactions to the closure of the long-time community staple. “I’ve gotten some letters from people saying ‘See what you can do to save it,’” Hernandez said. Others, such as resident April Aguirre, have “mixed feelings” about the news. “As sad as it is to see businesses close, these large retailers often make a neighborhood name for themselves by eliminating local competition,” Aguirre wrote, on her community blog “I Am San Fernando.” “And the San Fernando Mall is one of the few places where local businesses thrive, so it is exciting to think of what the new space might be used for.” The Plano, Tex-based J.C. Penney has struggled in recent years. The company reported a net loss of $163 million, or 75 cents a share, in its first quarter compared to a profit of $64 million, or 28 cents a share, in the same period last year. The San Fernando store has not been the only casualty in J.C. Penney’s restructuring. In January, the retailer closed up shop in Ashland, Wis., citing disappointing sales and an aging building that would require too much renovation. Ruelas said the closure of the J.C. Penney was a result of the company’s new store concept outgrowing its San Fernando space. The property was not able to accommodate J.C. Penney’s new full-product offering, which in turn led to the lackluster sales and business. Neither the retailer nor the city wanted to invest in the store and expand the space, Ruelas said. “J.C. Penney didn’t step up and the city didn’t step up,” he said. “In the end, the Northeast Valley was the loser because we lost our retailer.”