Source at Hoffman says all Kmart’s are closing in 2017, and Sears will phase out remaining sears store locations rapidly during 2017. Corporate is being told to hold it together as long as possible to give seritage growth properties time to sell off or re-lease the sears properties that it acquired. The remaining Sears owned stores will terminate their leases, shut down, or be sold and liquidated thru bankruptcy. Source left Hoffman about 3 weeks ago. Sears will end and seritage owned properties will eventually be leased, sold or re-developed 100% to buisnesses other than Sears.
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Just a comment on Seritage. they are a mid-sized developer. Their capacity for projects is somewhere in the 20-30 footprints every 4-6 months area. - it takes a tremendous amount of work and people to put all the pieces together to develop a new project. Even the huge guys can't take on dozens/hundreds of new projects per year, simply isn't feasible. Think that's partly why Eddie is struggling to keep the doors open, but there is still no way for him to effectively monetize the real estate working only with Seritage, they simply don't have the capacity.
I agree, sharing a Sears store with a Dave and Busters would be fun. After you burn out at your job that day, you can go to Dave and Busters to burn some steam off. Actually, that is a good idea 1/2 Sears 1/2 Dave and Busters would be nice.
dos anyone knows which other stores the daves and busters are going too. i may would stay if we was getting that but needs more money you know
@2NJS, thank you for that comment, I was wondering exactly what position 9055 had. I am wondering about this, since the System Crash earlier this September? Has things gotten worse IT wise at the Troy data center? Are you guys registers crashing more than ever at both Kmart/Sears & SHOS stores?
9055 would you please enlighten us with the following information?
What position do you hold at Sears?
What are your thought on the future of the company, how do you see it possibly being relevant again?
What is the highest level of education you have achieved?
9055,
You say that the Honolulu store will generate more revenue leasing the property than as a retail space.
This is wrong. SHLD doesn't own the property anymore, SRG does. Thus closing the store is a loss for sears and a gain for SRG.
The real estate value has been separated from SHLD and put into SRG. You have a fundamental misunderstanding of who owns the assets and who owns the debt.
Other posters understand the vulture capitalism that is occurring.
What is everyone's guess?
Yep, your completely right. I wonder if leased store closures will happen in January with Kmart and Sears also? Like 100-200 stores or more right after Christmas?
All Kmarts or Sears that are rented will close soon. All Kmart or Sears that are owned by SHC will close, be sold or redeveloped. It is all about the real estate. Keep an eye on the Seritage properties. As those get redeveloped and occupied then there will be more closures and sale of real estate assets. Then Seritage will redevelop the properties, rent them to other retailers and the process will repeat.
You can't close too many stores down at one time and transfer them to Seritage because then there would be too much real estate to redevelop at one time. It is about selling, transfering or redeveoping the real estate. It does not matter if the store makes money or not. If it is rented it is useless, if it is owned it can be sold or transfered to Seritage. Buy it break it apart make more money. The parts are worth more than the whole. Hedge fund/venture capital 101.
In almost every case of Seritage recapturing space, that space is generating more $$$ in rent than Sears was paying Seritage. The SHLD stores themselves were not producing as much profit as the leases to other retailers are or will be producing.
For example, while highly profitable, the Honolulu HI store will now produce more revenue being leased to other retailers.
It isn't unusual for a retailer to find that it's real estate is worth more than an operating store.
@1WHF, very direct and to the point, Thankyou.
Oh, one funny thing though 90 to 95% of what we talk about on here on here in regards to store closing and other SHC issues always come true. What does everyone think?
Are my percentages right or not?
Bad stores = closed
Good stores = sold
profit= bad
sales= bad
morale=bad
Cash= low
loans and debt= high
I may not be the best at math but I think that means
Associates = laid off...... and Sears= shutdown....
Thank You for that comment, Dave and Busters will be a huge traffic driver for the mall.
The huge Sears Grand, was an excellent idea before the merger but they screwed that up. Yanking, grocery, other Hardlines killed that store quick.
Here is my question, are Kmart/Sears stronger on soft lines or hardlines, which section brings more traffic into the store lately?
Attention 9055: Below are all examples of very Profitable stores where Sears sold the facility to seritage for redevelopment and Sears was liquidated. It isn't about the business, or positive or negative profit anymore. It is about the real estate. Look forward to your response back to this 9055, let me guess not gonna happen to your awesome store right?
Braintree, MA. The Company has recaptured 100% of a Kmart store within The Marketplace at Braintree, a dominant open air shopping center. The existing store will be redeveloped for multiple national retailers, including Nordstrom Rack, Saks Off 5th, and Ulta Beauty, which is already open. Sears Holdings vacated the property in February 2016 and the property is under construction.
Honolulu, HI. The Company has recaptured 100% of a Kmart store on a major transportation corridor proximate to downtown Honolulu. The store will be redeveloped into a multi-tenant shopping center for Longs Drugs (CVS), PetSmart, and Ross Dress for Less. Sears Holdings vacated the property in April 2016 and the property is under construction.
Memphis, TN. The Company has recaptured 100% of a freestanding Sears store and detached Sears Auto Center centrally located on Poplar Avenue, a primary east-west thoroughfare in East Memphis. The existing structures will be demolished, and the site will be redeveloped with over 135,000 square feet of space leased to Nordstrom Rack, Ulta Beauty and additional junior box, small shop and restaurant users. Sears Holdings vacated the property in April 2016 and construction activities are underway.
King of Prussia, PA. The Company has signed leases with Yard House and Outback Steakhouse to occupy the former Sears Auto Center at one of the country’s most productive regional malls. Primark and D--k’s Sporting Goods opened in 2015 and occupy the first and second floor, respectively, of the former Sears full-line store. Construction activities on the repurposing of the auto center commenced in the first quarter of 2016.
San Antonio, TX. The Company has recaptured 100% of a Sears Auto Center located directly across from the North Star Mall. The space will be repurposed for Orvis, Jared’s Jeweler, and additional small format tenants. Sears Holdings vacated the property in July 2016 and construction activities are underway.
Wayne, NJ. The Company has exercised its recapture right for portions of the full-line Sears store located at Willowbrook Mall, a dominant 1.5 million square foot regional mall in Northern New Jersey. The redevelopment will include Dave & Busters on the second floor and additional junior box and smaller format retailers on the ground floor, while Sears Holdings will retain space on both floors.
Fairfax, VA. The Company has exercised its recapture right for portions of the full-line Sears store and Sears Auto Center located at Fair Oaks Mall, a dominant regional mall with strong demographics in the Washington, D.C. market. The redevelopment will include Dave & Busters, junior box retailers, and restaurants on the second floor, while Sears Holdings will retain the space on the first floor.
North Hollywood, CA. The Company has submitted a recapture notice for approximately 50% of the free-standing, two-level Sears store located at the highly trafficked corner of Laurel Canyon Blvd. and Victory Blvd. in Los Angeles. The south portion of the building will be redeveloped for Burlington Stores on the upper level with additional retail on the lower level, while Sears Holdings will retain the downsized space on the north side.
Madison, WI. The Company has submitted a recapture notice for portions of the full-line Sears store located at West Towne Mall, a dominant regional mall in Madison, WI. The redevelopment will include Dave & Busters,junior box retailers, small shop retail and restaurants, and Sears will retain the remainder of the space attached to the mall.
Orlando, FL. The Company has submitted a recapture notice for 100% of the full-line Sears store and Sears Auto Center located at Orlando Fashion Square. The majority of the existing structures will be demolished, and the site will be redeveloped with approximately 140,000 square feet of space anchored by Orchard Supply Hardware and Floor & Décor, along with additional small shop and restaurant users.
West Jordan, UT. The Company has submitted a recapture notice for portions of the free-standing Sears Grand store and Sears Auto Center located at Jordan Landing Shopping Center, the primary regional shopping area in West Jordan, UT. The space will be redeveloped for Burlington Stores and smaller shop retail, while Sears will continue to operate in the remainder of the building.
BJ’s Brewhouse. The Company has exercised recapture notices for 100% of three Sears Auto Centers located at Colonie Center in Albany, NY, Bowie Town Center in Bowie, MD and Valley Mall in Hagerstown, MD. These spaces will be repurposed for BJ’s Brewhouse occupying 7,000 to 8,000 square feet per location, as well as additional restaurant users and small shop retailers. The Company is also developing a new outparcel for BJ’s Brewhouse at Glenbrook Square in Ft. Wayne, IN.
Thanks Wildcat Country,
You hit the nail on the head. The 1970s era Kmarts are very dingy, poorly maintained. If SHC were to remodel the Kmart stores fully, the best course would be tear down and rebuild using the 1990s floor plans from the Super Kmart era. Even if the stores did not contain grocery, they could focus more on the HardLines side of the business like a hugely expanded electronics department that carries home automation,routers,modems, and other IT products. Including large selection of TV's, Blue Ray Players, ect.
Bring back a full craft and sewing department including fabrics,sewing machines, Ect.
My best suggestion is bring back the legacy departments that Kmart was known for just upgraded for the 21st century.
Does this make sense?
Ok that makes sense the KCD products, drive traffic at Sears. I was not thinking about that.
When business schools across the country perform post mortems on the failure of Sears/K-mart, their verdict: an abysmally flawed executive management team. Naysayers might claim Internet sales, outdated box store concept, etc doomed Sears. However, many other big retailers are still surviving. (Albeit with occasional earnings hiccups.) Sears/K-mart's failure to update 1970s era stores into customer friendly stores clearly turned off customers. My heart bleeds for those employees whom are still there. Your time is very short. Find a better job elsewhere as soon as you can. It's not a matter of "if" but "when?"
GOOB= Going Out Of Business
I really don't know what's happening. I know what it means in the long run by spirit. What is GOOB?
you are missing the point about the kcd brands- they bring the traffic into Sears stores- if they are sold largely elsewhere it's good for the pension liability but no reason for anyone to go into a Sears store to get them...
Right now, everyone is right it is at a wait and see approach. Let's hope the GOOB at the Kmart stores start soon for the employees sake. The employees are suffering enough now, from horrible and unsafe working conditions.
I am sorry the GOOB sales are the best thing for everyone, it is time to put this company out of its misery. The KCD products can be sold at any retailer like Ace,Lowes/Homedepot/NTB. Just something to think about.
@1thj - good post
spot on, it would take years to get a small number of stores to make say $200 million a year- they don't have 3 years... plus the small number of stores could not even pay the yearly pension liability- alsohow would the small stores cope with no kcd products because under the terms of the collateral posted with the pension insurance guys as soon as the market cap of shld goes under $1billion they can seize those brands. There is no way out from this. Its a death spiral.
Sorry for my rant everyone was trying to make a point to 9055. He is just feeding us BS, he must have been brainwashed by crazy Eddie himself.
the company does not enough time to get to a small number of profitable stores- never mind the fact that how would those stores ever pay off the $7 billion and growing amount of liabilities they have- it may take a couple of years but its going bankrupt.
Ok 9055, how many of these "core" stores are left in both banners? Both chains have been starved of payroll, broken IT equipment, and employees who do not give a sh-- about their jobs while being paid $7.25-$8.00hr while most companies start employees off at $9hr.
Ok, 9055, none of us believe a word your saying. Your feeding us corporate BS. Everyone knows the stores are failing.
Putting lipstick on a pig is what SHC is doing to stores, they are getting "Decor Updates" like new signage while ignoring main problems like, leaking roofs,broken HVAC ,out of date and failing IT hardware, no payroll to run the stores, ect.
FYI: NONE OF US BELIEVE YOU AND YOUR "BS" 9055!!!!!!!!!
9055,
Do you have a response to the comments that several highly profitable stores have been listed for closure in the newest announcement?
Your argument/premise would carry more weight if we didn't see some high performers getting the axe in this round.
There is a core group of stores under both banners which are profitable. There's no question they will be survivors after 2017.
Can a smaller group of brick and mortar stores survive once the money losing stores are shuttered? Yes. And, you can see that efforts are underway to try new things and innovate.
As I mentioned previously, SHLD is not going to keep unprofitable stores open for an indefinite amount of time. I will add that many of the stores earmarked for closure have been kept open in order to fulfill lease terms. They have been given more shots to succeed and more injections of corporate resources than better performing stores.
I've been observing the slow decline of Sears for decades now, and the story just about over. The idea that closing a few stores will move the company closer to profitability is false. They have been closing stores for years now and the losses keep getting worse. The problem isn't the number of stores, it's the strategies and practices followed by Eddie Lampert and crew. They close the most unprofitable stores, but the better stores quickly turn unprofitable as they are starved for inventory, personnel, and other resources.
The only possible strategy to save the SHC retail companies at this point would involve massive reinvestment in the business. Under Eddie Lampert it isn't going to happen, and even if he were to step aside they probably don't have the resources left to make it work. Failure is inevitable, and 2017 is a good prediction for the end date.
Not to get too off topic, but yes other retailers do close stores. The difference is that they are still opening new stores. they often move location to a better area or a bigger building. People never actually read the details. The 150 stores Walmart is closing are mostly convenience stores that they just opened within the last few years. they were trying to enter a new market and it didn't work. They still open many supercenters every year. Sear/Kmart haven't opened a new store in 15 years. they are only closing them. According the the Kmart site and the store locator page, going state by state, there are only 752 Kmarts left. the ones announced to be closing Friday have already been removed, but that number includes Guam, Virgin Islands, and Puerto Rico.
From what I understand Guam is one of the most profitable in the chain. the Virgin Islands and Guam and very strange locations, they do not participate in sywr, integrated retail, abd many other corporate wide programs.
You can not keep losing money every quarter, something has got to give. My store lease is up Feb 2018, if we make it. SYWR can not save Sears.
Sad. And we keep reading all the encouraging things on Pebble.
I'll keep milking this cow while on commission.
But I'm keeping my eyes open.
Thanks for the updates.
Here is my question. If everyone thinks the post is true about the massive closures in 2017. Do you think they might close all of the Sears/Kmarts including shared DC's, ect. on the west coast first and then close the east coast stores?
Hawaii and Guam are interesting stores, I do not know if they might be considered prized stores by SHC? Maybe sold to seritage for redevelopment?
Thanks everyone, 9055 must have been brainwashed by crazy Eddie himself!!!. I am wondering does everyone think they will close up stores whole regions at a time? Like southwest/northern/southern region ect.?
People wake up, Sears is not just closing its non profitable stores, its also selling its MOST PROFITABLE stores.
Its not going to happen that fast….Wal-Mart and Target are also closing stores… Have you guys been living inside of a cave or under a rock.. Sears is losing over a billion dollars per year, and basically has very little left to sell, the fact that 500-1000 people check this site everyday because they need to know if they are next on the list kinda speaks for itself. Gez are you really that brainwashed to think that this sh-- bucket of a company is going to thrive again. Company is bankrupt and done very soon. To the poster that says sears cant be told what to do by seritage, you need to become better friends with google and do some more research on seritage, negative ebitda, Eddie,and the gang.... Maybe when you get the notice that your building is being demolished, just as the crew smashes it down you can say I still don't think its gonna happen that fast....
Actually to the poster 9055 Walmart closed exactly 154 stores this year. Macys could possibly close 100+- stores between the end of 2016/ 2017. Target is closing under 50?
So your facts are incorrect 9055.
No one I know in the company is aware of this type of drastic closure of stores. What is known: when leases are up and a store isn't profitable and has no chance at being profitable under new lease rates, the store will be closed. The company is not a philanthropy that keeps money losing stores open for charitable purposes. Walmart recently closed hundreds of stores, Target closed quite a few stores, and even Macy's is re-evaluating it's presence in a lot of markets with closures of their own.
I don't know if this is true or not, but for all we know it might be. The simple fact is that they are almost out of cash and credit. Companies just can't run indefinitely with losses. I repeat my belief that more Kmarts are closing before Christmas this year. The problem is that you have a company that just keeps lying and calling a failing a transformation. Chris Braithwaite and Howard Riefs really remind me of Muhammed Saeed al-Sahaf. If you don't know who that is, he was the Iraqi government spokesman at the beginning of the second Iraq war. You can google him and see his videos on youtube.