Once a mall staple and a go-to department store for generations of families since 1902, JCPenney has endured turbulent years marked by bankruptcy, mass store closures, and restructuring efforts. Now, as the retailer continues its long road to recovery, another major setback has emerged.
In July 2025, JCPenney entered into a $947 million all-cash deal with private equity firm Onyx Partners Ltd., agreeing to transfer the ownership of 119 store locations. The deal was executed through Copper Property CTL Pass-Through Trust, the entity created during JCPenney’s bankruptcy to hold and dispose of its real estate assets.
Copper Property disclosed that the amendment became effective on July 23 and was non-refundable, thereby guaranteeing the transaction, according to the trust’s press release. Once completed, the trust planned to distribute the proceeds to investors.
Under the terms of the deal, 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 included limited termination rights for individual locations in specific circumstances, such as property damage or condemnation proceedings.
Despite these arrangements, the trust cautioned that the transaction was contingent on meeting several closing conditions and could not be guaranteed. At the time, all 119 JCPenney stores remained open and operational.
The deal was initially expected to close on September 8, with the trust obligated to sell all properties by January 2026. However, repeated delays ultimately led to an unexpected outcome.
Months later, Copper Property revealed that the nearly $1 billion agreement had failed to close. In a Form 8-K filing dated December 22, the trust issued a notice to Onyx Partners confirming that the agreement would be terminated if the buyer did not complete the transaction by December 26, 2025.
The filing does not specify what would happen to the 119 stores, and JCPenney has yet to issue a public statement addressing the failed deal or the next steps.
This attempted sale dates back to JCPenney’s Chapter 11 bankruptcy filing in May 2020. While the company cited the COVID-19 pandemic as a key factor, it had not been profitable for nearly a decade prior.
As part of its restructuring, CPenney secured $450 million in debtor-in-possession financing to continue operating while reorganizing 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 assume ownership of 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 assets.
At the time of its bankruptcy filing, JCPenney closed over 200 stores nationwide. Earlier this year, the retailer confirmed plans to shutter seven additional locations.
Newmark previously owned 121 JCPenney store properties across 35 states. In early 2025, it sold two of those properties, one in Florida and one in Pennsylvania, to the 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 the then-newly appointed CEO, Ron Johnson, who introduced a new logo and redesigned stores to promote a more modern department store concept.
At the same time, JCPenney abandoned its long-standing promotional pricing strategy, replacing frequent sales and coupons with everyday low pricing. It 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 price paid,” said Marketing Expert Roy Harmon. “It was about the psychological thrill of the hunt. Customers loved the sense of ‘winning’ by stacking coupons and catching a great sale. By removing the discounts, Johnson removed a key source of perceived value and delight. Customers, confused and alienated by the new approach, fled in droves.”
More Store Closures:
As foot traffic and sales declined and competitors got ahead, JCPenney’s debt continued to mount.
“The JCPenney case illustrates the complex dynamics of branding in the modern retail environment,” said Attorney Schuyler Reidel. “While aspirations for revitalization are commendable, they must be grounded in a deep understanding of customer expectations and market realities to achieve successful outcomes.”
The COVID-19 pandemic further added to JCPenney’s challenges, disrupting its supply chain and forcing temporary store closures during 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, leaving empty mall storefronts and shuttered stand-alone locations across the country.
With 84.3% of Americans shopping online, U.S. e-commerce spending reached $1.34 trillion in 2024 and is projected to surpass $2.5 trillion in 2030, according to Capital One Shopping.
In 2024, U.S. online sales accounted for 22.3% of global e-commerce spending, up nearly 1.5% from the year prior, and are expected to reach $1.47 trillion in 2025.
Retailers announced 67% more store closures in 2025 than the previous year, according to CoreSight Research.
Related: Why your favorite retail store is going out of business
This story was originally published by TheStreet on Dec 27, 2025, where it first appeared in the Retail section. Add TheStreet as a Preferred Source by clicking here.