To Mervyns, state stores a lost cause

Published 9:00 pm Monday, January 16, 2006

Mervyns will close its stores in Everett, Lynnwood and the rest of Washington by early next year to improve profits.

The struggling department store chain has occupied its 117,000-square-foot anchor space at Everett Mall since 1992. Before Frederick &Nelson moved out of the mall, Mervyns operated for years at a space along Evergreen Way.

Despite the long history, Everett Mall’s management took Monday’s news in stride.

“We are not surprised by the announcement. We anticipated this very thing happening,” said Linda Johannes, the mall’s general manager.

The mall’s owner, Steadfast Cos., began planning last year for a future without Mervyns, she added.

“Steadfast started seriously pursuing other avenues for that space,” Johannes said. She said she could not discuss the possibilities, but she hopes the mall can announce in the next six months its plans.

Both the Everett Mervyns and the store at 3301 184th St. SW in Lynnwood will remain open through late January 2007, a spokeswoman for Mervyns LLC confirmed. Bellingham, Bellevue and Redmond are among the 11 other locations in Washington where Mervyns is closing.

“There’s going to be a lot of shopping centers affected by this,” Johannes said.

The chain also is closing six stores in Oregon and one in Salt Lake City. Altogether, the closures will mean the loss of 1,400 part- and full-time jobs, including 880 in Washington.

“Exiting the underperforming markets of Oregon and Washington will allow us to make investments that better serve our customers and Mervyns’ future,” Vanessa Castagna, executive chairwoman of Mervyns’ board said in a written statement. “We are confident that these decisions are right for Mervyns’ future growth and success, and are consistent with the strategy that we announced in September 2005.”

At that time, Mervyns announced it was closing 62 stores in eight Midwest states. That process is expected to be completed by next month.

After closing in Washington and Oregon, Mervyns will concentrate its investments on existing and new store locations in its profitable core markets in the Southwest, the company said.

Mervyns has been steadily losing market share to more nimble competitors for years, though it finished 2005 with an upturn in sales and seven consecutive months of profits.

Frustrated with the chain’s meager returns, Target Corp. sold Mervyns to a group of investors last year for $1.65 billion.

The Associated Press contributed to this story.

Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.