J.C.Penney’s will shutter a massive distribution facility in Buena Park and relocate the center to the Inland Empire, the company said Friday, along with news it would close up to 140 stores nationwide.
In a press release, the company stated it was “in the process of selling its supply chain facility in Buena Park in an effort to monetize a lucrative real estate asset.”
No details were provided regarding the number of employees who would be impacted by the looming closure.
The 1-million-square-foot, 24-acre compound at 6031 Orangethorpe Ave., was assessed at roughly $35 million last year, making it a valuable real estate asset for the troubled retailer. CoStar, a commercial real estate database, indicates the property is used as a “hub for J.C. Penney’s West Coast operations.”
“The driver here is selling industrial facilities in Southern California,” said Louis Tomaselli, a senior managing director at JLL. “They could sell this million-square foot DC (distribution center) that is 40 years old and pretty antiquated and sell it for over $130 million.”
Tomaselli echoed what is apparently happening with J.C.Penney’s planned move to the Inland Empire.
“They go sell a 40-year-old facility and then they lease a brand new facility … a brand new, state-of-the-art facility, a huge truck court. And they pay current market rates, which are well below what it would cost to operate the Orange County facility at the price level it was worth….