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Toys “R” Us Gears Up For New Strategy

October 25, 2016

In light of the success which the Star Wars franchise thoroughly enjoyed this year, Toys “R” Us  briefly enjoyed a 7% year over year sales increase, although it was not enough to keep the company from being forced to reinvent itself due to the increasingly supportive attitudes consumers have shown towards online shopping. After closing two landmark locations in New York last year, and with 1 billion USD in liquidity the retailer hopes to scale down, and zero in on the hottest to-date toys and products of the like, although this means taking on the likes of Amazon, and Walmart. At one time Toys “R” Us being known as the biggest toy store with every toy a child could want being available under one very large roof was one of their greatest assets, now they, landlords, as well as real estate investors alike will need to overcome what has now become a liability, and figure out how to adapt to the changing market which has less, and less need for big box centers. Cap rates which were an average of 7.3% before the 2008 recession, 8.7% during, have held at an average of 7.5% in 2Q16.

Toys “R” Us Plans New Strategy