Joann will close more than half of its stores

In a filing with the bankruptcy court, Joann Stores revealed that it would be closing 533 of its roughly 850 locations across the U.S.

Court documents list those locations across 49 states, and are listed in the story linked here with the largest numbers of closures as follows:

- 61 stores in California

- 36 in Florida

- 33 each in Michigan, Ohio and Pennsylvania

- 26 in Illinois

- 24 in New York

- 21 in Washington

- 20 in Indiana

- 19 in Massachusetts

Read more: Joann closing 500 fabric and craft stores in 49 states: Search full list of closures (USA Today)

Inflation is still not contained but not enough to stall retail leasing

Inflation is still alive and well in the U.S., and the bond markets are beginning to price maybe just one interest rate cut by the Fed in 2025. That’s the bad news.

But other than the price of eggs currently currently rising as a result of the bird flu outbreak in the U.S., the inflationary outlook is not so bad for most costs other than services, a labor factor that is not likely going to be influenced by new tariffs on imported goods.

In the most recent report this week, headline inflation rose from 2.9% to 3.0%, and core inflation, excluding food and fuel, rose from 3.1% to 3.3%; that’s not so alarming.

While core inflation (excluding food and fuel) rose, three other key measures and the Fed’s “supercore” (services excluding shelter) fell. In all cases, they remain above 3%, which it is still too high for the Fed to accept.

Read more: Eggs-istential Inflation Scrambles Bond Markets (Bloomberg)

Dutch Bros Coffee will open 160 new stores in 2025

Dutch Bros Coffee hit a milestone with the opening of its 1,000th store in Orlando in February 2025.

It has already opened 18 new stores since the start of the year, and expects to open at least 160 locations in 2025, representing a store growth of 16% from the 2024 store count.

In 2024, the drive-thru coffee chain opened 151 new shops (most of which were company-operated rather than franchised) across 18 states. Dutch Bros sees the potential for operating up to 4,000 shops, a growth spurt of four times its current count.

Read more: Dutch Bros reports strong Q4 growth; opening 'at least' 160 shops in 2025 (Chain Store Age)

Denny’s will shutter between 70 and 90 locations in 2025

In its most recent earnings report, Denny's announced it closed 88 locations in 2024, and will shutter between 70 and 90 locations in 2025, bringing the number of total restaurant closures for the combined two years to almost 180 in total.

Some of the diners slated to close were selected because they have expiring leases, have been open for more than 30 years (making them too expensive to remodel) or are located in declining markets.

Denny’s renovated only 23 locations in 2024 out of the 1,300 locations it has across the United States.

Read more: Denny’s is closing dozens more restaurants (CNN)

Malls rated class B- and below are likely to be repurposed over the next 10 years

According to Green Street, “The retail prospects for most malls graded ‘B-’ or below are generally dire; many will be repurposed with another real estate use over the next decade.”

But some experts — including the country’s largest owner of shopping malls Simon Property Group — believe that upgrading a B+ mall that is located in a good market with limited competition into an A- mall is doable given a sound capital allocation strategy for renovation, targeted leasing and marketing.

Read more: The Future of the American B Mall (and Other Grades) Remains in Flux as Fortunes Diverge (Retail Wire)

About 220 Winn-Dixie and Harveys groceries stores to close and reopen as ALDI

ALDI USA is disposing of roughly 42% of the approximately 400 Winn-Dixie and Harveys Supermarkets locations it acquired in 2024 and found unsuitable to convert to the ALDI brand. The balance of the stores ALDI acquired (about 220) will be reopened with the ALDI format and brand, with roughly 100 slated to reopen as ALDI stores by the end of 2025. Meanwhile Winn-Dixie and Harveys will continue to operate under their respective brands until they close.

The 170 stores ALDI has divested will go to a consortium of private investors led by Anthony T. Hucker, the current president and CEO of Southeastern Grocers (former owner of the Winn-Dixie chain), and C&S Wholesale Grocers. If you recall, C&S had been slated to acquire nearly 600 supermarkets from Kroger and Albertsons in connection with those retailers’ failed plan to merge.

Read more: Private investor group acquires Winn-Dixie parent Southeastern Grocers from Aldi (Florida Times-Union)

Retail leases accounting for almost 60 million square feet will expire in 2025

Leases comprising about 58.5 million square feet of retail space are set to expire this year. Landlords will surely seek to bring up expiring rents to market rents as they renew or find replacement tenants because overall vacancy is at an all-time low. Rent spreads continue to improve for retail but for the office sector, spreads are worsening.

About 85.5 million square feet of space leased to offices will expire in 2025 as vacancy in that sector is rising and office tenants are seeking less space or fleeing to Class A newer properties.

Read more: 265M Square Feet of Leases Set to Expire in 2025 (GlobeSt)

U.S. store closures to double in 2025

An estimated 15,000 stores will shutter in 2025 in the United States, compared to 7,325 in 2024, according to Coresight Research. Likewise, the number of new store openings is expected to fall to 5,800 in 2025 from 5,970 in 2024.  

More than 2,000 stores have already closed in 2025, according to Time Out, which represents an increase of 334 percent YoY. Also, several national store chains have announced consolidations, closures and even bankruptcy, including department store chain Kohl's, discount retailer Bargain Hunt and furniture/home goods retailer Big Lots. Other major names such as Walgreens, Macy's and Starbucks are also planning to consolidate some of their physical locations overlapping in some markets over the course of the year.  

On a positive note, there is still significant tenant demand for quality retail space and overall vacancy remains low. The national retail vacancy rate in the United States hovers around 4%. The vacancy rate has been below 5% for nearly three years.

Read more: US Store Closures Predicted to More Than Double in 2025 (Newsweek)

Take 5 Oil Change to double store count

Take 5 Oil Change plans to double its store count in the next four years. “We’ll be a 2,500-location business one day,” said Take 5 President Mo Khalid.

The business was acquired in 2016 by Driven Brands Inc., the operator of national automotive service concepts that include Meineke, CARSTAR Auto Body Repair Experts, Maaco Corporation and Auto Glass Now. Through franchising, Driven Brands has expanded Take 5’s presence into 42 states with more than 1,100 locations.

Read more: Take 5 Oil Change to Grow (Retail Leisure International - RLI)

Somnigroup will operate over 2,800 retail locations worldwide

Starting on Feb. 18, 2025, a name you’ve never heard will be the world’s largest mattress company that manufactures, wholesales and retails bedding products: Somnigroup International. The name is derived from “somn” meaning sleep in Latin, and “omni” meaning all.

Somnigroup is none other than Tempur Sealy International, which is rebranding its corporate name later this month after closing its $5 billion acquisition of Mattress Firm Group this week.

The Mattress Firm, Dreams and Tempur Sealy businesses will operate as decentralized units. Under Somnigroup, Mattress Firm and Dreams will continue to operate as retailers of multibranded bedding products. Tempur Sealy will continue to manufacture bedding for multiple retailers including its affiliated Mattress Firm, Dreams and its own DTC omnichannel.

The U.S. Federal Trade Commission had placed a preliminary injunction last year to stop the takeover but a U.S. District Court judge in the Southern District of Texas ruled in favor of the merger last month, which paved the way for completing the acquisition. The company will sell 73 Mattress Firm locations and the Sleep Outfitters USA retail chain, which includes another 103 stores to help appease antitrust regulator’s concerns.

Somnigroup will operate over 2,800 retail locations worldwide after the divestitures are completed in the second quarter of this year.

Read more: Tempur Sealy to Become Somnigroup After Mattress Firm Deal Closes (The Wall Street Journal)

Amazon has repurposed 25 struggling malls into distribution centers

As the total amount of operating malls decrease in the U.S. below the magical 1,000 mark, did you know that Amazon has already repurposed 25 struggling malls into distribution centers? Twenty-five!!!

Amazon acquired malls in Baton Rouge, Louisiana; Knoxville, Tennessee; Cleveland, Ohio and Worcester, Massachusetts, to convert them into fulfillment centers.  

Between 2016 and 2019, Amazon repurposed around 25 malls, but it also considered turning former declining department store locations into distribution hubs. The demand for data centers from Amazon's cloud business and Amazon Web Services (AWS) as well as Microsoft Azure, Google Cloud, Equinix, Digital Realty, CyrusOne, Vertiv Holdings Co. and Oracle Cloud are likely to consider dying malls as target real estate for data center operations. 

As many malls face declining cash flow, loan maturities and closures, selling the potentially valuable real estate as well-located land in commercial districts for redevelopment has become an appealing option.

Read more: Why Amazon and Walmart Suddenly Like Malls (PYMNTS)

Surprise! Walmart has acquired Monroeville Mall near Pittsburgh

Walmart’s acquisition of Pittsburgh’s Monroeville Mall was unexpected but the investment can make financial sense in the long run given how valuations of Class B and C malls have plummeted over the past decade and how much of an upside can be realized by investing capital to redevelop them.

Walmart certainly has the real estate expertise to own and operate shopping centers but I would have envisioned a joint venture with a traditional retail developer to tackle ownership, redevelopment, leasing and operations of a mall. We might see that JV in the near future as the redevelopment of the site gets underway.

In the 1970s and 1980s, retail chains were owners and developers of shopping malls, such as Allied Stores Corp., R. H. Macy & Co., The May Department Store Co., Homart Development Company (a subsidiary of Sears), Federated Department Stores (now Macy's Inc.) and Dayton-Hudson Corp. (now Target Corp.). Is this a sign of more change in mall ownership or just a one-off opportunistic investment for Walmart?

We’ll have to wait to see how Walmart’s plan for Monroeville unfolds. With retail vacancy at an all-time low, there’s tremendous opportunity to redevelop retail space for more efficient configuration and uses, some of which will surely include housing to satisfy demands.

Read more: Walmart takes on role of mall landlord with acquisition (CoStar News)

Simon wants to upgrade Class B malls

After years of prioritizing CapEx to help turn Class A malls into A+ trophy malls, Simon Property Group is right to shift its excess capital toward turning B malls into A malls.

It is not difficult to turn a B+ mall into an A- mall through redevelopment, re-leasing, consumer marketing, etc. Simon, with its very powerful leasing resources, certainly has the ability to identify and attract highly productive retailers to replace underperforming retailers through lease expirations. Simon can also buy out tenants to replace them with more productive tenants that will pay higher rents. Achieving better sales also pushes demand from the most desirable retailers. This alone can turn a B+ mall into a Class A- mall.

Read more: Simon seeks rent growth by upgrading outdated, second-tier shopping centers (CoStar News)

Chipotle Mexican Grill to open more than 300 restaurants in 2025

Chipotle Mexican Grill expects to open 315-345 new restaurants in 2025. At least 80% of them will have Chipotle drive-thru lanes. International growth will accelerate, especially in Canada and the Middle East, with ongoing efforts to improve the economic model in Europe.

Chipotle's sales grew 15% to $11.3 billion, driven by a 7.4% comp including over 5% transaction growth. The popular chain opened 304 new restaurants in 2024, with 257 featuring Chipotle lanes. If you want to lease to Chipotle, better to offer a location with drive-thru capability.

Read more: Chipotle targets 315-345 new openings in 2025 with focus on Chipotle lanes (Seeking Alpha)

Marco’s Pizza to open its 1,200th store in 2025

Marco's Pizza (Marco's Franchising, LLC) with 85 franchises awarded and 70 new store openings in 2024, is ready to surpass its 1,200th store milestone in 2025.

Key growth areas include expansion into non-traditional locations and international markets. Tony Libardi, co-CEO and president of Marco’s Pizza says “2025 will be a year of momentum.”

Headquartered in Toledo, Ohio, Marco’s was founded in 1978 by Italian-born Pasquale (“Pat”) Giammarco, but “Giammarco’s Pizza” just didn’t exactly roll off the tongue.

The company has grown from its roots as an Ohio brand to operate over 1,200 stores in 35 states with locations in Puerto Rico, the Bahamas and Mexico.

Read more: Marco’s Pizza Kicks Off 2025: Recapping a Stellar 2024 and Charting a Bold Path Forward (Marco’s Pizza)

Rails to increase brick-and-mortar presence

The Los Angeles-based clothing company Rails is shifting its strategy from wholesale to retail, and has announced it will open four new stores in 2025. The lifestyle apparel brand recently opened stores in Atlanta’s Buckhead Village and the Phoenix-area Scottsdale Quarter. It will also open new locations in Bethesda, Md., on April 25, and on Chicago’s Armitage Avenue later this spring.

After mostly selling wholesale during the first part of Rails' 15-year history, the new openings are part of what founder Jeff Abrams’ described as a retail strategy to open four to five stores per year, (mostly in the U.S., but maybe one to two international stores per year). Rails has 16 stores including stores in Amsterdam, Berlin, London and Paris.

Read more: Rails Plots U.S. Expansion and First Menswear Store in a Strategy to Pivot From Wholesale to Direct-to-consumer (Women’s Wear Daily)

Krispy Krunchy Chicken to open 600 stores in 2025

You’ve head of Chick-fil-A Restaurants, Popeyes Louisiana Kitchen and KFC. But have you heard at all about KKC? It’s the fastest growing chain of store-in-store restaurants serving Louisiana-style fried chicken called Krispy Krunchy Chicken by Krispy Krunchy Foods LLC.

The Alexandria, Louisiana-based chain beat its previous record of 481 restaurant openings in 2023, and opened 605 restaurants in 2024. This year it plans to open more than 600. Most of these restaurants are inside c-stores but many are inside Walmart, supermarkets, malls, casinos and college campuses. For comparison, fast-growing coffee chain Starbucks opened 614 new locations from 2023 to 2024, according to its financial filing.

KKC uses the Olo app to consolidate third-party delivery services and works with DoorDash, UberEats and Grubhub.

The restaurant chain was purchased by a private equity firm Main Post Partners in 2021. Jim Norberg is the CEO of Krispy Krunchy Chicken. Dan Shapiro is chairman of the board of the company. There are currently more than 3,200 Krispy Krunchy Chicken locations in 47 states.

Read more: A little-known Louisiana fried chicken chain quietly grew by more than 600 stores last year (Daily Mail)

Atomic Wings to double its restaurant count in 2025

Another fast-food chicken restaurant chain is looking to grow its store count. Atomic Wings, known for its New York-style buffalo wings has 22 units now open across the U.S. and a strong pipeline of development, aiming to open 30-34 units by the end of 2025.

Atomic Wings has now begun to expand beyond its traditional New York market, according to Zak Omar, CEO of Atomic Wings. In 2024, the chain entered Texas, Minnesota, Indiana, South Dakota, Virginia and Illinois.

This year, Atomic Wings plans to expand in Wisconsin, Michigan, Indiana and Ohio. In addition to its existing locations, Atomic Wings is targeting New York, New Jersey, Texas, Arizona and Nevada for additional growth. The brand is led by brothers Zak and Ray Omar.

Read more: Atomic Wings Closes 2024 with Record Growth and Big Plans for 2025 (Retail & Restaurant Facility Business)