REI Co-op’s closure of three flagship Northeast stores, including unionized locations in Boston and New York City, signals yet another victory for organized labor’s destructive impact on American businesses forced to make “tough choices” under financial pressure.
Story Highlights
- REI closing Paramus NJ, Boston MA, and NYC SoHo stores by 2026 after $156.4 million loss.
- Two of three affected locations have unionized workforces demanding negotiations.
- Company suffered 6.2% sales decline in 2024 following years of financial struggles.
- Closures reflect broader outdoor retail contraction as consumer spending shifts to essentials.
Financial Collapse Drives Strategic Retreat
REI Co-op announced closure of three major Northeast stores by 2026 after posting devastating financial losses. The outdoor retailer reported a staggering $156.4 million net loss in 2024, coupled with a 6.2% sales decline following a 2.4% drop in 2023.
CEO Mary Beth Laughton cited the need for “tough choices” as part of the company’s new three-year strategic plan called “Peak 28: Ascending Together.”
REI to close three Northeast stores in 2026 as it adapts to shifting markets and customer needs: report https://t.co/I2Ayn7f8To
— FOX Business (@FoxBusiness) October 15, 2025
The Paramus, New Jersey location will close first in early 2026, followed by the Boston and New York City SoHo stores in late 2026. These closures eliminate three high-profile urban flagship stores that once served as brand showcases but have become financial burdens due to rising operational costs and declining foot traffic.
Union Pressure Complicates Business Recovery
Two of the three closing stores—Boston and New York City—feature unionized workforces that are now demanding extensive negotiations over the closures. The REI Union expressed concern over the lack of advance notice and potential impact on contract negotiations.
The New York City store became REI’s first unionized location in 2022, with Boston following suit later.
This union involvement adds complexity to what should be straightforward business decisions aimed at financial recovery. While the Paramus location operates without union interference, the Boston and NYC stores face prolonged negotiations that could delay cost-cutting measures essential for the company’s survival.
Union representatives seek “constructive negotiations for affected workers” rather than accepting market realities.
Industry-Wide Retail Contraction Accelerates
REI’s struggles reflect broader challenges facing the outdoor retail sector as consumer spending patterns shift toward essential goods rather than discretionary purchases like camping and hiking gear.
The company previously closed its Experiences division in January 2025 and sold four warehouses in February 2025 to raise capital and reduce operational overhead.
Other major outdoor retailers including Orvis and Eddie Bauer have also announced store closures, indicating systematic problems throughout the industry.
Post-pandemic demand normalization hit particularly hard as consumers who purchased outdoor equipment during COVID-19 lockdowns no longer need replacement gear while facing inflation in housing, food, and energy costs.
Sources:
REI Co-op Closing Paramus Store Along with Boston and New York Locations
REI to Shut Some High-Profile Stores, Adding to Outdoor Retailer Closings
REI Stores Closing New York Boston Union Employees
