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HARLINGEN — Area leaders are counting on JCPenney’s Harlingen and Brownsville stores’ profitability to help keep them open following the national retailer’s nearly $1 billion sell-off.

Five years after the department store chain filed for bankruptcy, JCPenney is selling the two Rio Grande Valley stores along with 117 of its nearly 650 stores, apparently holding on to its McAllen store at La Plaza Mall.

Onyx Partners Ltd., a private equity firm based in Boston, Massachusetts, is buying the retailer’s 119 stores for $947 million.

The deal’s set to close on or before Sept. 8.

In Harlingen, JCPenney’s store is located at Valle Vista Mall, where it’s the last major retailer, while Brownsville’s store’s at Sunrise Mall.

“As far as we know, they’re not going to shut it down — it’s just business,” Harlingen City Manager Gabriel Gonzalez said Thursday. “We don’t know why they would close the stores in the Valley because they’re profitable. To buy them and shut them down doesn’t make sense.”

At the city’s Economic Development Corporation, Orlando Campos, the agency’s chief executive officer, said JCPenney’s described the Harlingen store as profitable.

“The last we communicated, they indicated sales were going very well,” he said, referring to the agency’s contact with the company earlier this year. “It’s holding on.”

In Harlingen, the store’s become one of the city’s last national retailers, Campos said.

“It’s one of the major remaining national retail stores so a lot residents rely on it,” he said.

During the COVID-19 pandemic, JCPenney, founded in 1902, filed for Chapter 11 bankruptcy, with the company agreeing with lenders to slash its billions of dollars of debt while exploring sale options.

At Valle Vista Mall, the JCPenney store stands as the last of its original anchors.

“It’s one of the legacy retailers so whenever a new store comes to the mall, JCPenney has to sign and approve them,” Campos said.

Throughout the year, the store draws steady business, Carla Romero, a sales clerk there, said Thursday.

“The store has been busy,” she said. “It keeps busy all year”

But news of the store’s sale stunned her.

“I think that’s good,” Romero said. “It’s good it still keeps going.”

During Valle Vista Mall’s 20-year decline, residents like Joseph Ortega have remained steady customers.

“It’s about the only good store in Harlingen to shop at,” he said. “We’re missing name-brand stores.”

Now, the store has become Jessica Marroquin’s only stop at the old mall.

“The JCPenney brand is pretty good,” she said. “I’ve always liked it.”

Like many residents, Ortega remembers when the mall served as the region’s premier shopping destination.

“It used to be the best mall in the Valley,” he said.

For about 20 years, the mall, amid changing consumer buying patterns and online shopping trends, was losing big-name anchors like Dillard’s and Sears.

By 2002, construction of the Expressway 77-83 interchange was blocking traffic to the mall, driving many shoppers to Brownsville’s growing retail district.

Now, Marroquin said, “I feel the mall itself is finished.”

“There’s hardly any stores left,” she said.

For years, city officials have envisioned the mall’s redevelopment.

Last year, the EDC contracted Jackson Walker, the biggest law firm in Texas, for $30,000 to study real estate documents as part of a plan aimed at working to help prospective buyers.

The Dallas-based law firm experienced in real estate law and land use issues has “expertise in sorting out complicated development programs,” Campos said at the time.

Earlier this year, the law firm presented officials with its report, he said.

“It’s information we can share with potential buyers,” Campos said.

“We hired the law firm to review and give us a summary of the legal issues impacting the mall,” he said.

In 2018, the Kohan Retail Investment Group, based in Great Neck, New York, purchased Valle Vista Mall for $12.5 million before selling the mall’s four major boxes to four groups.

Now, seven groups own different parts of the mall, Campos said.

“There’s layers and layers of agreements executed. That becomes a little challenging,” he said, referring to any prospective sale of the property spanning about 60 acres. “Now you have multiple owners owning different properties.”

On Thursday, Mike Kohan, the mall’s owner, could not be reached for comment.

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