Macy's, Inc.'s capital expenditures (including capitalized software) totaled $1.105 billion in 2007. In 2008, the company expects to spend $1 billion for new capital projects, including investment in direct-to-consumer business, point of sale upgrades and continued distribution network improvements. In each of 2009 and 2010, capital expenditures are expected to be $1.1 billion.

Over the next three years, the company has allocated about 54 percent of its capital budget to store remodels, expansions and maintenance, including reinvent initiatives.

Elements of the reinvent concept will continue to be rolled out to stores nationwide in 2008 and beyond. These elements include improved visual presentations and signage, upscale shopping buggies, price-checking scanners, enhanced fitting rooms and customer lounges. By mid 2008, stores representing more than 70 percent of the company's volume will have been reinvented.

New stores will account for approximately 21 percent of capital spending for the years 2008-2010. Before the fourth quarter of 2008, Macy's, Inc. intends to open five additional department stores and two new furniture galleries. Macy's will open stores in North Denver, Co, Houston, TX, Tampa, FL, and two in New Orleans, La, (including re-opening the Hurricane Katrina-damaged esplanade store). Macy's furniture galleries will open in Southgate, Co and Portland, or. The company expects to open approximately 20 additional new department stores by the end of 2010. Most of these new stores will open in lifestyle centers being developed in existing Macy's markets.

New technology/distribution accounts for 25 percent of the 2008-2010 capital-spending plan. Macy's, Inc. continues to invest in technology to improve its operations and customers' experiences in our stores and our Web sites.

Capital Spending 2008-2010
Reinvent, Minor Remodels and Maintenance		37%
Technology/Distribution		25%
New Stores		21%
Expansions/Major Remodels		17%