Elk Grove retail woes

Mervyn's liquidating, Circuit City on the ropes and of course we can't forget General Growth Properties. Also, sadly Elk Grove loo...


Mervyn's liquidating, Circuit City on the ropes and of course we can't forget General Growth Properties. Also, sadly Elk Grove looks to have lost another eatery


By now most people have heard that California-based Mervyn's will be closing all of it's stores, including the one in Elk Grove's Marketplace 99 shopping center.

This week also saw reports that electronics retailer Circuit City is facing dire financial straits. Circuit City is reportedly considering a Chapter 11 bankruptcy or shuttering several of it's under-performing stores. Circuit City operates one loaction in Elk Grove.



Then of course there is the on-going saga of General Growth Properties (GGP) Elk Grove Promenade. The completion date of the Elk Grove Promenade depends if cash strapped debt riddled Chicago-based real estate and mall developer can straigthen out a self-inflicted financial mess.

Today, GGP stock closed at $2.80 and had an intra-day 52 week low of $2.33. GGP had traded as high as $54.53.

Earlier this week the Wall Street Journal reported that GGP floated the idea of selling preferred shares to dig itself out of the hole. As of today though, that idea does not appear to be developing.

So what does this mean for Elk Grove?

While the collapse of Mervyn's and the possible closing of one electronics store alone won't hurt Elk Grove, it does point to a larger problem looming for the city's finances.

With so much of the cities job base and revenues dependent on retail sales, the trend going into next year is unfavorable. In China, several factories have closed in response to weakened American consumer demands just before the all important Holiday buying season.

With large retailer stores closing and the anticipated revenues from the Promenade in suspense, Elk Grove will likely experience significant local unemployment and fewer city services.

On a slightly different note, it appears another locally-owned restaurant has seized operations. We noticed "Roosters" on Elk Grove Blvd. and Waterman has been closed for business for several days. While there is no sign announcing it, "Roosters" appears to be yet another victim of the recession.

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