Broadway Will Close Up Shop in Orange in '96 : Retail business: The parent company will convert three of the more profitable stores in O.C. to Macy's.

By GREG JOHNSON

Nov. 18, 1995 12 AM PT

TIMES STAFF WRITER

Parts of Orange County’s retail puzzle fell into place Friday as Federated Department Stores Inc. announced it would close its Broadway store in the Mall of Orange early next year, but convert stores at three other locations to Macy’s.

Broadways at Brea Mall, Laguna Hills Mall and Fashion Island in Newport Beach will switch nameplates after the holiday shopping season ends, according to company officials.

But the fate of Broadways at Crystal Court in Costa Mesa and Huntington Center in Huntington Beach won’t be determined until later in the year.

As Federated searches for a buyer for its 165,000-square-foot outlet in the Mall of Orange, insiders are speculating that Wal-Mart Stores or a major movie theater could be possible tenants.

Left up in the air, though, is the fate of 142 employees in Orange who are expected to work through the holidays and possibly into the early spring.

The changes announced Friday are being driven by Federated’s October acquisition of the financially troubled, 82-store Broadway Stores Inc. chain.

Cincinnati-based Federated, with $15 billion in sales and more than 440 department stores, is eliminating the Broadway name in order to strengthen its Macy’s and Bloomingdale’s chains.

Store profitability and location were the driving factors in determining which Broadways will be converted into Macy’s, said Federated spokeswoman Carol Sanger.

“We looked at a store’s current performance and future profitability and how it fit into the existing store mix,” she said.

As part of an ongoing consolidation, Federated will convert at least 40 Broadways into Macy’s stores. It also will close and sell off about 10 unwanted locations, including the Mall of Orange store.

Federated is expected to turn a few stores--including at least one Orange County location--into a Bloomingdale’s, the crown jewel of its retail chains.

Federated said it will sell nine stores outside of Orange County to Sears, Roebuck & Co. Federated won’t know the fate of 21 other stores, among them the two in Orange County, until later in the year.

Word of the impending closing stunned Broadway employees in Orange.

“Why me? Why this store?” asked one employee. “There is a real family atmosphere at the store and of course there is always that feeling of betrayal.”

“I hate to see it go,” said Orange resident Ed Murphy, 68, a Broadway retiree who was shopping at the store Friday. “The employees are real sad too. They’re the worst off of anyone . . . It’s kind of a bad time, too, right after Christmas.”

But even as Broadway employees struggled to cope, retail industry insiders were speculating about possible tenants for the anchor store at Mall of Orange.

One real estate expert said that Wal-Mart, which recently opened storefronts in Anaheim and Laguna Niguel, is interested in the Orange location.

Wal-Mart doesn’t discuss its expansion plans, but the Bentonville, Ark.-based chain is expected to open more stores as it expands in Southern California.

Some longtime shoppers said they would boycott a discount store. “Certainly not a Wal-Mart,” huffed Anaheim resident Norma Miller, who’s been shopping at Mall of Orange for more than 15 years. “It would bring down the prestige of the mall.”

Another theory suggests that Kansas City-based AMC Entertainment Inc. will knock down its small, six-screen movie theater at Mall of Orange and replace it with a huge megaplex that’s in keeping with an industry trend toward bigger complexes.

No matter what happens, Hyde Leland, a 79-year-old retired doctor from Orange, said the Broadway closing will further dull the mall’s luster: “This mall has been pretty poor for a long time. I think it’s just hanging on by its teeth.”

Speculation also continues to swirl about Federated’s strong presence at South Coast Plaza, where the retailer has a Broadway and two Bullock’s stores. Federated earlier said that the Bullock’s name would disappear as it converts stores to Macy’s and Bloomingdale’s outlets.

South Coast Plaza and Fashion Island in Newport Beach have been fighting to win a Bloomingdale’s store. But Friday’s announcement that Federated will convert the Fashion Island Broadway into a Macy’s could mean that South Coast Plaza has won the coveted prize.

However, it’s uncertain if Federated will keep all three storefronts in the pricey mall. Some observers suggested that Federated might close one or convert it into a high-end furniture store.

Macy’s arrival at Laguna Hills Mall, Brea Mall and Fashion Island struck a positive chord Friday afternoon among shoppers, employees and operators of nearby retail shops.

“Macy’s will be an improvement over Broadway,” said Sarah Dashefsky, who regularly rides the shuttle bus to Laguna Hills Mall from her home in Leisure World. “And it would be nice if Nordstrom would come over here.”

“It should be much better,” agreed Hratch Torossian,owner of RondaFine Jewelry inside Laguna Hills Mall. “It’s a step up for the mall and for us also.”

John Matyuch, manager of Au Bon Pain, said that Broadway customers and employees who frequent his bakery are “very excited about it. They seem to feel Macy’s has a little more upscale quality merchandise than Broadway.”

Brea Mall executive Dennis Denaut said that “shoppers are very receptive to the Macy’s name . . . And we hope they keep the Broadway store employees, who’ve done a terrific job in the community.”

Federated plans to spend about $525 million to convert and remodel at least 40 Broadway stores in California and two other states. About 9,400 Broadway employees evidently will be offered jobs in the converted Macy’s stores.

Times staff writer George White and correspondents Lesley Wright and Leslie Earnest contributed to this story.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Broadway Make-Over

The status of four of the Orange County Broadway stores purchased by Federated has become clearer--three will be converted to Macy’s outlets by early next year, and the Mall of Orange outlet will close early next year. The status of stores at Crystal Court and Huntington Center is uncertain:

Scheduled to be closed early in 1996 if no buyer is found:

1. Mall of Orange

Employees: 142

Space: 165,000 square feet

Opened: Aug, 16, 1971

If closed: Eligible employees will be offered severance, help finding new jobs, some company-paid health premiums and chance to apply for openings at other Macy’s stores.

Stores to be converted to Macy’s early in 1996:

2. Brea Mall

Employees: 293

Space: 154,500 square feet

Opened: Oct. 21, 1978

3. Laguna Hills Mall

Employees: 326

Space: 165,000 square feet

Opened: Aug. 4, 1975

4. Fashion Island, Newport Beach

Employees: N/A

Space: 183,000 square feet