Friday, October 14, 2016

Sears Saga to Continue for Some Time, as Company Faces “No Urgency” to Close Stores

Sears Corp. recently signaled its intent to exit leases on 17 unprofitable stores totaling 1.7 million sq. ft., and as part of an existing master lease agreement will pay its REIT spin-off, Seritage Growth Properties, rent though January 2017, plus a termination fee equal to an aggregate of one year’s base rent. These stores are reportedly Kmart locations, following on a mid-September announcement that Sears subsidiary Kmart will be closing 64 stores. Taken within the context of rumors surrounding Sears Corp. in recent months, these newest closings seem to put the company one step closer to liquidation. So the question remains: as the value of Seritage’s holdings grows, does Sears have a strategy to improve its retail operations?. . . more

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