Quote:
Originally Posted by legion
Our local mall had five anchors 3 years ago:
Sears
Macy's
JC Penney
Kohl's
Bergners
The Macy's was originally a Famous Barr (a St. Louis based retailer that specialized in secondary markets), but they got bought out by Macy's 10 years ago. None of the locals were happy as everyone expected the local store to be closed the second Macy's had financial problems. But everyone thought Sears would be the first to go. Their traffic had been declining for two decades and they had done absolutely nothing to update the store or their archaic systems.
Macy's closed first two years ago. JC Penny was next, which surprised no one. Bergner's was the next to go, which surprised everyone as they had the best traffic of any of the anchors. Finally, Sears, which everyone had been anticipating closing, finally started liquidation this month.
Kohl's stands alone.
The JC Penney has been converted into a Planet Fitness and an H&M. Bergner's and Macy's still sit empty.
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Sears likely lasted longer because Seritage Growth Partners, the REIT that owns most of Sears's locations charged them rent at about 1/3 going market rates. Seritage is also 40% owned by Lampert which explains why Sears got the lower rent deals.
This does setup a somewhat value option in Seritage if you think they can navigate the short term loss of rent from Sears while they refill their various locations with more profitable tenants.