Good morning. It’s Wednesday. We’ll look ahead to the Macy’s Thanksgiving Day Parade and why Macy’s has more to worry about than bad weather. We’ll also get details on why City Hall is rushing to close a migrant shelter in Brooklyn before President-elect Donald Trump takes office in January.
It’s going to rain on Macy’s parade tomorrow. The National Weather Service says so. But that is only one of Macy’s worries right now.
Others include $154 million that went missing from the company’s books. And then there are declining sales and “underproductive” stores.
Macy’s announced the $154 million issue — an accounting error it says an employee responsible for tracking how much the company spent delivering small packages “intentionally” made — at the beginning of what amounts to its prom week.
The Thanksgiving parade, with giant balloons and loads of confetti and performances outside its flagship store, in Herald Square, gets Macy’s into the conversation in people’s homes. For people in the New York area who don’t mind the crowds, it has been a draw for 98 years. For people who don’t like the crowds — and those outside New York — there’s always the television broadcast. This year, there will be 22 floats and several new character balloons, including a new Minnie Mouse and Spider-Man.
There are a couple of tricky turns on the route, from the Upper West Side to Midtown. Sometimes the people pulling the guide wires beneath the balloons are tugging against logic-defying downdrafts. But the parade leads the way to the holiday shopping season, when Macy’s leans into Santa Claus like few other retailers. It hopes for moments that will last in people’s memories.
But there is more to Macy’s than pageantry at this time of the year. So its decision to delay its full earnings report this week left Wall Street without a harbinger of how the end of the year might play out.
It released preliminary financial results amid the mystery of the $154 million. The money is not actually missing — no one pocketed anything, according to a person familiar with the matter. But how so much in hidden expenses went uncaught for so long is one of many questions Macy’s has not answered, although it said its investigation had not identified involvement by any other employees. Macy’s said it would report its earnings by Dec. 11.
In relative terms, the $154 million was a small fraction of the $4.74 billion that Macy’s rang up in sales during the third quarter. But in absolute terms it was not inconsequential: As my colleague Jordyn Holman noted, it was roughly equal to Macy’s second-quarter profit.
That points to another headache for Macy’s: declining sales. That has become a refrain for brick-and-mortar retailers, especially for large chains that are anchor tenants in malls, as Macy’s is beyond Manhattan. The company said its sales had slipped 2.4 percent in the third quarter, hobbled by weak performance at the vast majority of its Macy’s stores and in its online business.
Macy’s is nine months into a new strategy of slimming down. The pain will be felt beyond Manhattan — the flagship store in Herald Square is safe, and probably always will be. But Macy’s plans to close 150 stores over the next three years in its latest round of downsizing. It said it wants to shed “underproductive locations” that account for 25 percent of its overall square footage but only 10 percent of its sales. That will leave Macy’s with 350 stores, just over half the number it had before the coronavirus pandemic.
It is keeping a particularly close watch on 50 of those stores, the star performers that it sees as avatars of its future. For those 50 stores, sales were up 1.9 percent in the third quarter. Macy’s prides itself on Herald Square, although it doesn’t break out sales store by store.
Macy’s chief executive, Tony Spring, has had that job for only nine months, but he is not new to the company; until February he had spent decades at Macy’s corporate cousin, Bloomingdale’s. One bright spot for the company: Comparable sales at Bloomingdale’s and Bluemercury, another upscale brand that Macy’s owns, were up in the third quarter.
Weather
Expect a mostly sunny day with temperatures in the low 50s. For tonight, there is a chance rain after midnight, with temperatures in the low 40s.
ALTERNATE-SIDE PARKING
In effect until Thursday (Thanksgiving Day).
The latest New York news
Another corruption investigation: Federal authorities have opened a criminal investigation into a political action committee formed by a Queens pastor to support Mayor Eric Adams. That brings the number of corruption inquiries involving the mayor or members of his inner circle to six.
Big payments to tenants who were overcharged: The private equity firm Blackstone is paying some renters more than $100,000 each to settle claims that their previous landlord had overcharged them. Blackstone bought the building in 2018.
Loyalty rewarded: President-elect Donald Trump has offered key roles in his administration to more than a dozen political operatives, lawyers and elected officials who attended his criminal trial in Manhattan.
Ways to fix the housing crisis: Dealing with the city’s housing crisis will probably involve putting together bits and pieces of many competing ideas. Here is what renters, landlords, developers and politicians suggested.
The city may close a huge migrant shelter before Trump takes office
One consequence of the presidential election is a plan to close a huge migrant shelter in Brooklyn. City officials are concerned that the tent complex could become a target for President-elect Donald Trump, who has promised to detain and deport undocumented immigrants.
The tents are on a decommissioned runway at Floyd Bennett Field on land that the federal government leases to the city. City officials fear that Trump could cancel the lease as soon as he takes power in January — or that he could dispatch immigration officers to round up noncitizens there.
Mayor Eric Adams, a Democrat, signed the lease with the Biden administration last year, when city officials were struggling to accommodate the influx of migrants from the southern border. Under the terms of the deal, both the city and the federal government have the right to exit the lease on relatively short notice.
The city is housing more than 57,000 migrants in 210 shelters, hotels and temporary tent facilities across the city, after a two-year influx of asylum seekers that has recently shown signs of subsiding. But the temporary shelter at Floyd Bennett Field, which opened in November 2023, is the only migrant shelter in New York on federal land.
My colleagues Luis Ferré-Sadurní and Dana Rubinstein write that the city is trying to figure out where to relocate 500 families from Floyd Bennett Field. City officials are waiting to announce the shutdown until the state guarantees that it will continue paying to house that number elsewhere. The state government has been underwriting operations at the shelter at a rate of about $250 million a year.
Adams, speaking at a news conference on Tuesday, declined to discuss the future of the shelter. He said only that he wanted to scale back the largest emergency shelters as the migrant crisis wound down.
“When I make a determination of what I’m doing with Floyd Bennett Field,” he said, “I’m going to announce what I’m doing with Floyd Bennett Field.” A spokesman for Trump’s transition team did not immediately respond to a request for comment.
METROPOLITAN diary
Member of the Press
Dear Diary:
I was recently chosen for a role as a background actor on “Law & Order.” My part was “member of the press.”
I was sent to the prop truck, where the prop master dumped out a plastic bag and told me to take my pick from the press badges, small notebooks, and pens and pencils.
After settling into the “courtroom,” I began to thumb through the pad I had chosen. Flipping through pages filled with different sets of handwriting was kind of like flipping through a guest book.
I was amused by the notes left by previous “reporters.” Every few pages reflected each person’s take on their experience.
Here, a neat record of long-forgotten plot points; there, an impromptu poem or observations about law enforcement. And then there was the entry that, assessing one of the characters, said people with mustaches were not to be trusted.
— Karen Foppiani
Illustrated by Agnes Lee. Send submissions here and read more Metropolitan Diary here.
Glad we could get together here. See you on Friday. — J.B.
P.S. Here’s today’s Mini Crossword and Spelling Bee. You can find all our puzzles here.
Jordyn Holman, Francis Mateo and Ed Shanahan contributed to New York Today. You can reach the team at [email protected].
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The post At Thanksgiving Time, It’s Raining on Macy’s Parade appeared first on New York Times.
