In 2003, Federated Department Stores rebranded all Lazarus locations as Lazarus-Macy's in order to expand the Macy's name throughout the United States. The dual-branding also introduced several Macy's product lines to the merchandise mix of Lazarus. The same year, both floors of the Galyan's building were expanded, increasing the store size by ; one year later, Galyan's was sold to Dick's Sporting Goods, resulting in the closure of a nearby Dick's Sporting Goods which had only been open for a year. Federated acquired The May Department Stores Company, then the parent company of L. S. Ayres, in 2006 and announced plans to convert most of the May Department Stores brands to Macy's. As part of this, the Lazarus-Macy's store was rebranded again to just Macy's. Castleton Square was one of four malls in Indiana to have both a Macy's and a division of May Department Stores, so in all four cases Federated chose to maintain the existing Macy's and close the acquired stores. As a result, the L. S. Ayres location was closed in mid-2006. A year after closure, the building was demolished for a new outdoor concourse featuring Borders Books & Music, an AMC Theatres multiplex, Johnny Rockets, Stir Crazy, Cold Stone Creamery, and H&M. Following the closure of Borders in 2011, its space was renovated for the clothing store Forever 21.
