A mall staple and go-to department store for generations of families since 1902, JCPenney has endured turbulent years marked by bankruptcies, major store closings, and restructuring efforts. Now, as the retailer continues its long road to recovery, another major setback has emerged.
In July 2025, JCPenney acquired private equity firm Onyx Partners Ltd. entered into a $947 million all-cash settlement to agree to transfer ownership of 119 store locations with The deal was executed through the Copper Property CTL Pass-Through Trust, an entity created to hold and dispose of JCPenney’s real estate assets during its bankruptcy.
Copper Properties disclosed that the transaction was guaranteed as the amendment took effect on July 23 and is non-refundable, according to the trust’s press release. Once completed, the trust plans to distribute the proceeds to investors.
Under the terms of the agreement, the properties were subject to a triple-net master lease, under which JCPenney remains responsible for all operating costs, including property taxes, insurance, and maintenance. The lease also contains limited termination rights for individual locations under certain circumstances, such as property damage or condemnation proceedings.
Despite these arrangements, the trust cautioned that the transaction was contingent on the fulfillment of several closing conditions and could not be guaranteed. At the time, all 119 JCPenney stores were open and operating.
The deal was originally expected to close on September 8, with the trust obliged to sell all assets by January 2026. However, repeated delays eventually led to unexpected results.
Months later, Copper Properties disclosed that it had failed to close a nearly $1 billion deal. In a Form 8-K filing on Dec. 22, the trust issued a notice to Onyx Partners confirming that the deal would be terminated if the buyer did not complete the transaction by Dec. 26, 2025.
The filing does not specify what will happen to the 119 stores, and JCPenney has yet to issue a public statement addressing the failed deal or next steps.
The attempted sale dates back to JCPenney’s Chapter 11 bankruptcy filing in May 2020. Although the company cited the COVID-19 pandemic as a key factor, it was not profitable until nearly a decade ago.
As part of its restructuring, CPenney secured $450 million in debt-in-possession financing to continue operations while it restructured its business.
The retailer was eventually acquired by Simon Property Group (SPG) and Brookfield Asset Management (BAM) for $1.75 billion, transferring ownership of its retail and operating assets.
Copper Property was created during this process to own 160 retail properties and six warehouses. Managed by an affiliate of Hilco Real Estate LLC., the trust is responsible for owning, leasing, and selling those properties.
At the time of its bankruptcy filing, JCPenney closed more than 200 stores nationwide. Earlier this year, the retailer confirmed plans to close seven more locations.
Newmark previously owned 121 JCPenney store properties in 35 states. In early 2025, it sold two of those properties, one in Florida and one in Pennsylvania, to Simon Property Group and Brookfield Asset Management.
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Texas: 21
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California: 19
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Florida: 6
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Michigan: 6
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Illinois: 5
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Ohio: 4
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Arizona: 4
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New Jersey: 4
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Connecticut: 3
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Nevada: 3
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New York: 3
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Oklahoma: 3
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Pennsylvania: 3
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Washington: 3
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Arkansas: 2
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Colorado: 2
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Kentucky: 2
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Maryland: 2
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Missouri: 2
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New Mexico: 2
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Puerto Rico: 2
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Tennessee: 2
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Virginia: 2
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Georgia: 1
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Iowa: 1
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Idaho: 1
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Indiana: 1
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Kansas: 1
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Louisiana: 1
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Massachusetts: 1
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Minnesota: 1
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Mississippi: 1
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North Carolina: 1
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New Hampshire: 1
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Oregon: 1
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Wyoming: 1
Analysts attribute JCPenney’s decline to a major rebranding effort in 2011 under then-newly appointed CEO, Ron Johnson, who redesigned stores to promote a new logo and a more modern department store concept.
At the same time, JCPenney abandoned its long-standing promotional pricing strategy, substituting constant sales and coupons for everyday low prices. It has also reduced its private-label offerings to focus on national brands.
The change failed to resonate with its core customers and instead created a perception of higher prices.
“For the JCPenney shopper, the brand experience wasn’t just about the final payment,” said marketing expert Roy Harmon. “It was about the psychological thrill of the hunt. Customers loved the feeling of ‘winning’ by stacking coupons and catching big sales. By eliminating discounts, Johnson removed a key source of perceived value and pleasure. Customers, confused and alienated by the new approach, fled.”
More store closings:
As foot traffic and sales declined and competitors moved forward, JCPenney’s debt continued to grow.
“The JCPenney case illustrates the complex dynamics of branding in the modern retail environment,” said attorney Schuyler Reidel. “While aspirations for revival are laudable, they must be based on a deep understanding of customer expectations and market realities to achieve successful results.”
The COVID-19 pandemic added to JCPenney’s challenges, disrupting its supply chain and forcing temporary store closures at an already uncertain time.
Traditional brick and mortar retail continues to shrink. Rising operating costs and the rapid growth of e-commerce have reshaped consumer behavior, closing empty mall storefronts and stand-alone locations across the country.
With 84.3% of Americans shopping online, US e-commerce spending is projected to reach $1.34 trillion in 2024 and surpass $2.5 trillion in 2030, according to Capital One Shopping.
In 2024, US online sales accounted for 22.3% of global e-commerce spending, up nearly 1.5% from the previous year, and are expected to reach $1.47 trillion in 2025.
Retailers announced 67% more store closings in 2025 than last year, according to Coresight research.
Related: Why Your Favorite Retail Store Is Going Out of Business
This story was originally published by TheStreet on December 27, 2025, where it first appeared in the Retail section. Add TheStreet as a preferred source by clicking here.
