M
acy's may be making progress on monetizing its real estate, according to the company's latest earnings report. The department store chain expects to sell $275 million worth of retail properties next year, a significant increase from previous forecasts of $150 million. This uptick is largely driven by accelerated store closures, with Macy's announcing an additional 10 store closures on top of its initial plan to close 55 locations.

    The company's real estate portfolio is estimated to be worth between $5 billion and $14 billion, far exceeding its market capitalization of $4.6 billion. CEO Tony Spring noted that the increased focus on store closures reflects the value of Macy's assets, even in a less stable market.

    A recent sale of a 440,000-square-foot Macy's space in Downtown Brooklyn for $23 million has sparked interest among investors. However, an immediate stake sale valued the property at $80 million. This comes as activist investor group Thor Equities and Barington Capital Group push for Macy's to create a separate real estate unit to help sell properties.

    The group estimates Macy's real estate portfolio is worth between $5 billion and $9 billion and suggests that a subsidiary would control owned and leased properties, with the retailer paying rent. The investors see an opportunity to maximize value from Macy's flagship store in Manhattan's Herald Square. In response, Macy's expressed confidence in its strategy but stated it was open to engaging with the activist group.