Sears to close Burnsville store, 19 more as crisis continues

Sears Holdings is closing another 20 stores, one in Minnesota, as the distressed department-store chain seeks to stanch the bleeding amid swirling challenges for the retail sector.

Sears Holdings is closing another 20 stores, one in Minnesota, as the distressed department-store chain seeks to stanch the bleeding amid swirling challenges for the retail sector.

The company will shutter 18 Sears stores and two Kmart locations, real estate investment trust Seritage Growth Properties confirmed in a Securities and Exchange Commission filing.

The Sears store at Burnsville Center is on the list of closures.   

The move adds to a steady drip of closures that now add up to more than 260 for the year, leaving the company with more than 1,100 remaining locations.

The iconic American department-store chain has buckled under pressure from online competitors, having failed to reinvent its brick-and-mortar experience.

The company acknowledged in March that there was "substantial doubt" it would survive on its own, though CEO Eddie Lampert has since blasted critics and said Sears is "fighting like hell" to carry on.

Sears Holdings has already shed $1 billion in costs this year, mostly through stores closures, and raised cash by selling its Craftsman brand to Stanley Black & Decker.

The latest round of stores will begin liquidation sales by June 30 and will close by mid-September, Sears said in a statement.

"We understand that members may be disappointed when we close a store, but our Shop Your Way membership platform, websites and mobile apps allow us to maintain these valued relationships long after a store closes its doors," the company said. "As a result, we hope to maintain and even grow our relationships with the members who shopped this location."

Business Insider reported that the list of stores set to close includes three in Ohio, three in New York, two in Texas and two in Maryland. USA TODAY could not immediately confirm those locations.

The company was spending about $11.2 million annually in rent on the 20 leases, according to Seritage, which was formed in 2015 in a sale-leaseback deal that provided Sears with financial aid and real-estate flexibility.

The company will owe Seritage one year of rent plus one year of annual operating expenses as an early termination fee.

Lampert's investment firm owns 43.5% of the limited partnership units of Seritage and controls 7.9% of its voting power.

The move was similar to transactions favored by investors in legacy retailers whose real estate is considered more valuable than their actual business.

 

© 2017 USATODAY.COM


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