By Randy Tucker
The Cincinnati Enquirer

Federated Department Stores Inc. said Friday that it will close five struggling department stores in four states, including the Lazarus-Macy's store in Oxford near the Miami University campus.

The announcement came as a shock to the community and 39 employees at the Oxford store, who were informed Friday morning that they would lose their jobs when the store closes in March.

"That means we are stuck with Wal-Mart," said Jessi Sheff, 16, Talawanda High School junior from Oxford who said she goes to Lazarus at least three times a week.

Kelly Lynch, 20, an MU junior from Cleveland, goes to Lazarus "every once in a while when I need something to wear. There really isn't anything around other than Wal-Mart, unless you go to Colerain (Township)."

Jim Eveslage, who owns several Oxford stores including Karisma, a high-end clothing store on High Street, said, "I think the townspeople will be disappointed. I can't imagine the students would be disheartened."

"Something bigger and better will" replace Lazarus, he predicted.

Ryan Wyrick, Oxford's director of economic development, said losing the department store, which has been a city landmark for decades, will mean the loss of a popular gathering place as well as a significant share of retail tax dollars.

"Most of the retail in Oxford consists of smaller, locally owned boutique-style shops," Wyrick said. "When Lazarus-Macy's closes, one of the major clothiers will be absent from the community, and that will obviously change the shopping patterns for a lot of people who may go elsewhere to shop."

Ellen Fructman, a spokeswoman for the Rich's/Lazarus/Goldsmith's-Macy's division of Federated - which also operates the Bloomingdale's and Macy's chains - said the company simply could not afford to keep the Oxford store open.

"We need to be where the customer shops," Fructman said. "And we're seeing the demographics shift away from these locations where we are closing stores."

In addition to the Oxford store, Cincinnati-based Federated also announced the closing of Lazarus-Macy's in Westerville, Ohio, and downtown Pittsburgh.

The company will also close two underperforming Rich's-Macy's stores, in Birmingham, Ala., and Smyrna, Ga.

All told, Federated will cut 369 jobs and reduce annual sales by about $35 million because of the closings.

Closing costs will total about $15 million, including a one-time charge of $7 million in the fourth quarter, which ends Jan 31.But the charge will not have a material effect on profit forecasts for this fiscal year of $2.15 to $2.20 a share, the company said.

Staff writer Anna Michael contributed to this report. E-mail rtucker@enquirer.com