Chicago Illinois Real Estate Blog

Starbucks Corp. is closing 18 Chicago-area stores as part of its plan to shutter about 600 of its coffee shops nationwide.

The local closings include five stores in the city: two on the North Side, two on the South Side and one on the West Side, according to a list obtained by Crain’s.

A Starbucks spokesman says there are more than 300 stores in the Chicago area, and declines further comment. The company recently released the full list on its web site.

The Seattle-based retailer announced July 1 that it would close about 600 “underperforming” stores.

The 600 stores slated to close account for just more than 5% of the chain’s more than 11,100 stores nationwide. The closings in Chicago are less than 6% of the company’s store base here.

According to the list of stores closing nationwide: New York City will have nine stores close, while Los Angeles will see two closings. Hard-hit cities include Las Vegas, 13, Dallas, nine, San Diego, nine, Houston, eight, Indianapolis, seven. Starbucks’ hometown of Seattle is to have seven stores shut down.

The closures are part of CEO and founder Howard Schultz’s plan to slow expansion of the coffee chain. The chain said most of the stores will be closed by next March.

Starbucks has suffered a decline in sales and earnings as cash-strapped consumers have pulled back on spending for gourmet coffees and other luxuries amid record gasoline prices and a slowing economy.

Company executives have said about 70% of the 600 stores being closed are less than three years old. The executives estimated the closing stores took about 25% to 30% of revenue from nearby locations.

The owner of one new shopping center that’s losing a Starbucks, the Promenade of Bolingbrook, hadn’t heard of the closing at his mall in the southwest suburb, but said he wasn’t surprised.

“There are four Starbucks here,” says Jerry Ferstman, vice-president at Cleveland-based Forest City Enterprises Inc. “How thirsty can people be?”
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