No. of Recommendations: 6
JCP has, indeed, been having problems. The new "everyday low price strategy," along with the concept of stores within stores, has been very slow to catch on. There's been a lot written about this, so I won't get into it.

I think the key point for REIT investors, particularly mall REIT investors, is where Penny stores are located. If they decide to close some stores, they will most likely be in the less productive malls, and the REITs that own those may have problems backfilling the vacated space.

Thus investors in CBL and PEI should have more to worry about than investors in GGP, MAC, SPG and especially TCO. Indeed, some store closings may provide a REIT with the opportunity to find a better and more productive tenant, as has been the case on many prior occasions.

Ralph
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