RETAIL
Sears Holdings to Close Stores, Strikes Lease Deal with Primark
Sears Holdings is closing stores in the U.S., but the Hoffman Estates, Ill.–based retailer has yet to confirm the actual number of closures planned.
After financial news website Seeking Alpha reported liquidation notices for 46 Kmart stores, 30 Sears stores and 31 Sears Auto Centers had been sent, the retail giant confirmed to USA Today that there will be closures but not as many as had been reported.
The company, which whittled down its retail holdings earlier this year, currently operates about 800 Sears stores and 1,100 Kmart stores.
In the company’s second-quarter earnings report, released Aug. 21, Sears Chief Financial Officer Rob Schriesheim said the company continues to “reduce unprofitable stores as leases expire and in some cases will accelerate closings when it is economically prudent. We have already announced the closure of approximately 130 underperforming stores in fiscal 2014 and may close additional stores during the remainder of the year.”
A firm count of the closures is scheduled to be announced later this year when Sears releases its third-quarter earnings report.
On Oct. 20, Sears announced the signing of seven lease agreements with Ireland-based Primark, which will lease approximately 520,000 gross square feet of retail space in mall-based stores in the Northeastern U.S. Sears will continue to operate in six of the locations with “a streamlined store format of up to 100,000 selling square feet at each store.”
“Partnering with a globally recognized brand such as Primark to help establish its store base in the Northeastern United States is testimony to both our attractive store locations and our focus on transforming Sears by working with other retailers, mall owners and brands,” said Sears Holdings chairman and CEO Edward S. Lampert in a statement.
According to a Sears statement, Primark will open the first of these stores at King of Prussia Mall in King of Prussia, Penn., joining Dick’s Sporting Goods as a subtenant of Sears. Primark will occupy a 100,000-square-foot space on the lower level. Dick’s Sporting Goods already occupies a 75,000-square-foot space on the upper level. The Sears store and its auto center will no longer operate at the Simon Properties–owned mall. Sears is also expected to downsize to the General Growth Properties–owned Staten Island Mall. The Sears store will occupy a 70,000-square-foot space adjacent to a 70,000-square-foot Primark store, which is scheduled to open in 2016. The location will also house a Land’s End store. (Land’s End was previously under the Sears Holdings umbrella, but the retail chain was spun off in April.)
“These lease agreements with Primark illustrate how Sears Holdings is strategically transforming one of the largest retail real estate portfolios in the United States over time while continuing to operate its existing stores in large but rationalized selling space,” said Jeff Stollenwerck, president of real estate for Sears Holdings.
Primark was founded in 1969 in Dublin and currently operates more than 270 stores in nine European countries. Its first U.S. store is scheduled to open next year in Boston.
