NEW YORK (CNNMoney) -- Call it the new Miracle on 34th Street -- a department store chain actually announced plans Monday to open a new store there.

Target said Monday it will open a new store on 34th Street, directly across from Macy's flagship New York City location. The move comes at a troubled time for the department store sector, as online competition from site such as Amazon pressure traditional retailers.

Macy's announced in January plans to close 68 stores nationwide and cut 10,000 jobs.

Last month Hudson Bay, the owner of Saks and Lord & Taylor made a bid for Macy's, a source told CNNMoney at that time. But since then it's been reported that Hudson Bay is now bidding for another troubled department store chain, Neiman Marcus, which said last week it is considering a sale of the company.

JCPenney recently announced it's closing 138 stores, while Sears Holdings said it's closing 150 Sears and Kmart locations.

Target's new Herald Square store will be 43,000-square foot and is due to open in October 2017. While that may sound big, it's actually considered a "small format" store by the retailer. Most Target stores are typically about 130,000-square feet. Macy's flagship store, at 1.1 million square feet, will be more than 25 times larger than its new neighbor.

It's not just Target moving in on Macy's Herald Square territory. Nordstrom announced plans to open a Nordstrom Rack store a few blocks south of the area just last month.

Macy's has always had neighborhood competition. For decades its primary competitor, now-defunct Gimbels, had its own large flagship store in Herald Square, while JCPenney still has a Herald Square location.

Target is the nation's second largest department store chain behind Walmart. It already has two other Manhattan stores and has announced plans for two additional stores beyond the Herald Square location. Although it's faring better most troubled retailers, it's had its own problems as well. Last week it reported a disappointing earnings report and gave a gloomy outlook for 2017.

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