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Tuesday, June 14, 1994 - Page updated at 12:00 AM

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Nordstrom To Close California Store -- Changes In State May Force Long-Term Consolidation

Seattle Times Staff: AP

Nordstrom plans to close a 9-year-old, full-service store in Northern California, in what at least one retail industry analyst believes may be the first step in a larger, long-term consolidation for the retailer in that state.

Company officials announced Nordstrom is closing its 150,000-square-foot store in Oakridge Mall in San Jose. The store, opened in October 1985, will shut its doors March 31. Sears Merchandise Group will take over the site.

Jim A. Nordstrom, company vice president and general manager for Northern California, said business in that region continues to be strong.

"However, we must continually examine each of our store's contributions to the overall performance of the region," he said in a statement. "Over the past several years, we have determined that the costs involved in operating the Oakridge store do not justify a continued investment in the location."

Nordstrom, which has 77 stores in 14 states, is likely to close more stores in California over the long term because of demographic changes in that state, said retail analyst Saul Yaari of Piper Jaffray.

"I don't see it as a negative," Yaari said. "It's just forced by the change in the state of California and the fact that, in relative terms, there are better opportunities in the Midwest and East Coast, even the South."

Yaari said the demographic changes mean California is gradually becoming a better market for discounters such as Sears, Kmart and

Wal-Mart, rather than Nordstrom. Nordstrom has 12 stores in Northern California.

The Oakridge store employs about 270 people. Nordstrom said it will place as many of them as it can at other stores in the region.

It is not the first full-service store Nordstrom has closed. The company closed a store in Fairbanks, Alaska, in January 1990 and the Aurora Village store in 1992.

Since October 1985, Nordstrom has been one of the three anchors

at the San Jose mall, which is owned by Hahn Co. of San Diego and JMB Retail Properties Co. of Chicago. But 18 months later, it opened a 165,000-square-foot store just 10 miles away at Valley Fair, another Hahn mall. Nordstrom also operates a 187,000-square-foot store at Stanford, 25 miles north of Oakridge.

The announcement is the latest in anchor changes at South Bay malls. In February, Saks Fifth Avenue said it plans to shut its store at Stanford.

Copyright (c) 1994 Seattle Times Company, All Rights Reserved.

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