Wal-Mart Stores Inc. will close its Port Covington store in South Baltimore in a cost-cutting move to shutter 269 under-performing stores worldwide, the giant retailer said today.
The city's only Walmart will close Sunday. The store, which opened in 2002, sits amid empty parking lots and a closed former Sam's Club on 50 acres now planned for a new headquarters for Baltimore-based Under Armour.
A real estate company owned by Under Armour CEO and founder Kevin Plank purchased the site of the Port Covington Walmart two years ago to eventually build a new corporate campus. The Sam's Club already is being converted into offices for the Baltimore-based sports apparel maker.
Those plans are part of Sagamore Development's vision to transform the largely industrial peninsula into a multi-billion dollar, mixed-use development over the next two decades with offices, homes, stores, restaurants, parks and running paths.
Opt trim quote“We are proud to be a part of Port Covington's next chapter and look forward to working with the surrounding communities on the transformational redevelopment of the entire Port Covington peninsula, which will... have a fundamental, far-reaching postive impact on the city and its future,” Sagamore Development said a statement issued after Wal-Mart's announcement.
The world's largest retailer targeted the Port Covington store for closure after reviewing its nearly 11,600 worldwide stores, looking at financial performance and alignment with long-term plans. Stores to be closed represent less than 1 percent of revenue.
“It's pretty small in the grand scheme of things,” yet uncharacteristic for the discount chain known for gobbling up real estate and rarely shedding it, said Brian Yarbrough, a consumer staples analyst for Edward Jones.
The discounter is ending its experiment with small format Walmart Express stores, which the retailer had launched to compete with dollar stores and which account for 102 of the 154 closures in the U.S. Wal-Mart had been testing the format since 2011. Other U.S. store closings include 23 Neighborhood Markets, 12 Supercenters, seven stores in Puerto Rico, six discount centers and four Sam's Clubs.
The 115 store closings outside the U.S. include struggling stores in Brazil and other Latin American markets.
About 16,000 employees will be affected, including about 10,000 in the U.S.
“Closing stores is never an easy decision, but it is necessary to keep the company strong and positioned for the future,” Doug McMillon, president and CEO of Wal-Mart Stores Inc., said in the announcement.
Walmart CEO McMillon said the company plans “disciplined” growth this fiscal year, which starts Feb. 1, with more than 300 store openings globally. The retail behemoth said it plans to strengthen its Supercenters and expand online business and store pickup services. Between 50 to 60 Supercenters and and 85 to 95 Neighborhood Markets are slated to open in the U.S.
Yarborough questioned the discounter's renewed focus on its Superstore format, and plans for more stores openings, at a time when online retailing is growing both for Walmart and in general.
With most of the closed stores within 10 miles of another Walmart, “the hope is that these associates will be placed in nearby locations,” the company's announcement said.
In Maryland, the retailer runs 59 stores, including Supercenters, discount stores and Sam's Clubs, and employs nearly 17,000 people.