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What's next for Macy's at the Shops at Wiregrass?

It has been nearly a month since Macy's, amid slumping sales, announced it would close 100 stores by next year.

Those stores account for 14 percent of the retailer's total number of department stores. While the company hasn't said which stores will close, analysts and credit firms have speculated about which stores are most at risk. A Tampa Bay area store could be on the chopping block.

The Macy's department store at the Shops at Wiregrass in Wesley Chapel is on a list of underperforming stores by Morningstar Credit Ratings, which included 28 stores across the country that reported sales less than the company's national average in 2014.

The Macy's at Wiregrass reports $118 in sales per square foot. The only other Florida store to make this list, which came out last month, was the Macy's store at the Lakeland Square Mall, which reported $89 in sales per square foot.

"That mall was a little premature," said Paul Rutledge, first vice president at CBRE Inc. in Tampa. The Shops at Wiregrass opened during the height of the Great Recession and when Wesley Chapel was still mostly underdeveloped. That must have had an impact on Macy's sales, Rutledge said.

"This is the problem for public companies. They report every quarter and need to make money right away for investors," he said. "If that store wasn't making money in the past, they have less of an interest in fighting to keep it open in the future, even if things are starting to pick up in that area and at that mall."

The last Macy's department store to close in Tampa Bay was the Gulf View Square mall location in New Port Richey last year. There are 13 Macy's stores from Pasco to Sarasota counties, including furniture galleries.

The Macy's store at Wiregrass comes into question at an interesting time. Cleveland-based Forest City Realty Trust Inc. is considering selling off its retail portfolio, which would include the Shops at Wiregrass, officials said during a recent investors call.

The 642,000-square-foot open-air mall opened in 2009 at the corner of State Road 56 and Bruce B. Downs Boulevard in Pasco County. It is currently 93 percent occupied and is anchored by Dillard's, Macy's and JCPenney department stores. There are more than 100 other stores in the lifestyle center.

It was among the first major commercial developments in the area. Since then, the Tampa Premium Outlets mall opened on State Road 56 just west of the Interstate 75 interchange in October. More retail development is on the way, too. Despite the potential sale, Forest City is still moving forward with a 34-acre expansion to the east of the Shops at Wiregrass that will include a movie theater and more residential and commercial development. It's not uncommon for a developer to sell off a property after it's developed and it has owned it for a few years.

Those in the real estate business think a sale, both by Macy's and Forest City, seems to make sense right now.

"That mall opened almost 10 years ago. I don't know if there's a better time than the near future to sell that mall," Rutledge said. "Why not test the market? I think every prudent landlord is considering it right now."

Rutledge noted that Bill Edwards, owner and developer of the Sundial shopping plaza in downtown St. Petersburg, also has his property on the market.

Macy's owns a lot of its department store real estate, including its space at Wiregrass. There is value in selling back land to developers or someone else at a pretty good multiple, said Jim Kovacs, managing director of retail services with Colliers International. The value of the real estate may be more than the operating business in some of these at-risk stores.

The Macy's move is similar to the Super Target at 16400 State Road 54 in Odessa that closed in January, Kovacs said. The store, along with 12 others nationwide, closed because of falling sales. The Super Target opened in 2006 in a plaza bordering the Suncoast Parkway at the height of the housing boom. While there are some suburban neighborhoods nearby, most of the immediate area is still undeveloped.

"There are terrific demographics coming online in these areas, and Target left too early," Kovacs said. "Maybe it's a mistake to go away, but it's not surprising with how quickly developers and retailers buy and sell these days."

Contact Justine Griffin at jgriffin@tampabay.com. Follow @SunBizGriffin.

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