Nordstrom has announced it will permanently close its Santa Monica store located at 220 Broadway in Santa Monica Place on August 26, marking the end of operations at one of its Southern California locations despite the company reporting strong fourth quarter earnings that exceeded expectations.
"We've made the decision to close our Nordstrom Santa Monica store, located at 220 Broadway in Santa Monica, California. The store's last day of business will be August 26," a Nordstrom spokesperson said. "We believe we'll be best able to serve customers in the area by leveraging our surrounding stores and through our digital channels. Decisions like this are never easy, and we understand the impact they have on our team members. We're committed to taking care of our employees through this transition, including supporting those who are interested in finding another role within Nordstrom."
The closure comes as Nordstrom reported robust financial results for the fourth quarter of 2024, with the company delivering revenue, comparable sales and earnings at or above the high end of its fiscal 2024 outlook. The retailer posted fourth quarter net earnings of $165 million, or $0.97 per diluted share, with earnings before interest and taxes of $242 million.
"Customers responded positively to the strength of our offering across both banners in the fourth quarter," said Erik Nordstrom, chief executive officer of Nordstrom, Inc. "We maintained the momentum we built throughout the year, which resulted in full-year sales and profitability coming in at the high end of our expectations."
The company saw quarterly sales growth across its store formats and digital channels, with total company comparable sales increasing 4.7 percent in the fourth quarter. The Nordstrom banner specifically showed strong performance with comparable sales increasing 5.3 percent, while Nordstrom Rack comparable sales increased 3.5 percent.
The Santa Monica closure reflects broader retail industry trends that have accelerated since the pandemic. This isn't the first time Nordstrom has made difficult decisions about its physical footprint in response to changing market conditions.
In 2020, during the early months of the coronavirus pandemic, Nordstrom temporarily closed all department stores and Nordstrom Rack outlet stores. The company subsequently announced that 16 stores would be permanently shuttered as a result of both the pandemic's impact and evolving market trends pushing more shoppers online.
However, some locations in the Santa Monica area, including stores in Brentwood, Culver City and the mall remained open following the 2020 closure announcement.
The closure is the latest in a string of troublesome news for the once thriving downtown Mall.
Prism Places, a commercial real estate firm managing $2.8 billion in assets, has been appointed to manage Santa Monica Place shopping center after its previous owner Macerich defaulted on a $300 million loan. The 527,000-square-foot outdoor retail center is now controlled by court-appointed receiver Trigild.
The mall faces severe challenges with a nearly 70% vacancy rate. Once home to luxury retailers and department stores, it now primarily attracts visitors to the Cayton Children's Museum, Cheesecake Factory, and newly opened Din Tai Fung. The center has found some success with rotating pop-up attractions but recently lost the True Food restaurant.
Originally designed by Frank Gehry, the property underwent a $265 million renovation in 2010 to transform from an enclosed mall to an open-air center. Macerich had owned it since 1999 before identifying it for sale last year.
Prism has said it has plans to revitalize the mall but has to complete the receivership process with Macerich before it has authority to make substantive changes to the mall.