Target to close nine stores across four states because of theft and crime

Target Corp. will shutter nine stores across four states on Oct. 21 because of theft and threats to safety, the company announced Tuesday, the latest — and loudest —example of a retailer exiting urban locations because of crime.

Target said it made the "difficult decision" to close the stores — which include locations in the Harlem neighborhood of New York City, Seattle, Portland and the San Francisco Bay area — after the Minneapolis-based company determined that theft-preventive measures had proved ineffective. The company said it had tried adding more security, including third-party guards, and using deterrents such as locking up merchandise.

"We cannot continue operating these stores because theft and organized retail crime are threatening the safety of our team and guests and contributing to unsustainable business performance," the company said. "We know that our stores serve an important role in their communities, but we can only be successful if the working and shopping environment is safe for all."

Target said it would offer the majority of affected employees — though it declined to provide a specific number for those affected — the opportunity to work at other locations.

Target leaders have continued to publicly decry organized retail crime, saying it has seen high levels of it for about a year, and it has hurt the bottom line.

In the spring, Target executives said they expected inventory shrink, attributed in large part to theft and organized retail crime, to reduce the company's profitability by more than $500 million this year compared with last year.

During a call about the company's second-quarter earnings last month, Target CEO Brian Cornell said Target's stores saw a 120% increase in theft involving violence or threats of violence in the first five months of the year.

"Our team continues to face an unacceptable amount of retail theft and organized retail crime. ... Shrink in the second quarter remained consistent with our expectations but well above the sustainable level where we expect to operate over time," Cornell said at the time.

The store closures signal how serious the issue of retail crime has become in the past two years, said Carlos Castelán , managing director of local retail consulting firm the Navio Group.

"At the end of the day, safety is paramount," he said. "To the extent that retailers or mall operators or anyone else feel like they need to take some of these measures to make sure that people feel safe when shopping there, I'm sure they don't make those choices lightly."

It's difficult to measure the impact of retail crime, which not only affects costs — like replacing stolen shopping carts — but also customer and employee experiences, Castelán said. Closing a store is usually a last resort, he added.

The National Retail Federation (NRF), which represents retailers across the country, reported Tuesday the average shrink rate in fiscal year 2022 increased slightly to 1.6%, a rise from 1.4% in 2021. Shrink, driven primarily by theft, brought $112.1 billion in losses for the industry in 2022. In the survey, more than 45% of retailers reduced store hours, nearly 30% altered store selections and about 28% closed a location because of crime or violence.

Last year, the NRF, with support from retailers such as Target and Best Buy, successfully advocated for Congress to pass the INFORM Consumers Act, which requires online marketplaces to verify the identity of high-volume, third-party sellers to help prevent larger criminal enterprises from selling stolen items online. In May, Gov. Tim Walz signed into law a bill that defined organized retail theft in Minnesota, delineating it from petty theft, something police have worked toward for years.

Retail crime, while not new, has come to the forefront of consumer awareness in recent years as people have used social media to record brazen thefts as well as some retailers' responses, like aisles of locked cases filled with personal care products.

Several of the cities where Targets are closing have seen other retailers recently depart thanks to crime and other factors associated with changing downtown shopping trends. In San Francisco, Whole Foods closed its downtown store in April just a year after opening it to ensure the safety of its employees. San Francisco-based Old Navy closed its flagship downtown store, and Nordstrom also closed two of its San Francisco stores.

Walmart shuttered its only two stores in Portland earlier this year. Outdoor retailer REI said it would close its store, saying it "had its highest number of break-ins and thefts in two decades, despite actions to provide extra security," according to the Oregonian.

"It is disheartening to learn that Target has made the decision to close stores here in Portland and in other major cities nationwide," Portland Mayor Ted Wheeler said in a statement. "As we continue making strides to re-staff the Portland Police Bureau and partner on targeted retail theft missions, we are also implementing increased safety measures like enhanced lighting and foot patrols to create safer public spaces for everyone."

The Brooklyn Center Walmart closed this past spring, and while Walmart didn't mention public safety concerns as a reason, Brooklyn Center Police Chief Kellace McDaniel had recently called the area surrounding it "a hotspot for crime." In Minneapolis, Target closed its small-format Uptown store in May, though Target only cited performance as a factor.

For Target, which operates more than 1,900 stores nationwide, losing nine is negligible, especially as the retailer plans to open about 20 locations throughout the country this year.

But for a community that might depend on the retailer for necessities like groceries and school supplies, the loss could be substantial, said Toopan Bagchi, founder and managing director of Twin Cities retail consultancy Starship Advisors.

"It's unfortunate that it has to come to this," Bagchi said. "But I wonder, beyond additional security measures and national policy advocacy, did they engage anyone at the local level to develop more creative solutions and grassroots support to what might be a significant employer and grocery source in a potential food desert?"

The closing stores:

517 E. 117th St., New York, N.Y.

4535 University Way N.E., Seattle, Wash.

1448 N.W. Market St., Seattle, Wash.

1690 Folsom St., San Francisco, Calif.

2650 Broadway, Oakland, Calif.

4301 Century Blvd., Pittsburg, Calif.

939 S.W. Morrison St., Portland, Ore.

3031 S.E. Powell Blvd., Portland, Ore.

4030 N.E. Halsey St., Portland, Ore.