Sears to revamp Florida store to preview strategy
A mixed-use retail development in South Florida may provide a glimpse at the future of Hoffman Estates based-Sears Holdings Corp.
The department-store chain said today that it will convert its location in Aventura, Florida, into an open-air development that includes dining, other retailers and a scaled-down Sears store. The project, called Esplanade at Aventura, will also contain a hotel and offices, according to a statement today.
The move fits with Sears's strategy of squeezing more value out of its extensive real estate holdings. The Hoffman Estates, Illinois-based company has been leasing space in some of its stores to other retailers, and the chain said last week that it was considering spinning off hundreds of its properties as a real estate investment trust.
With the Aventura Mall project, Sears would repurpose the site's parking lot, auto center and department store into a more inviting property. The plan calls for about 250,000 square feet (23,000 square meters) of restaurants and retail. That includes a 20,000-square-foot Sears store and about 45,000 square feet of office space, parking and a hotel.
"Our owned real estate adjacent to Aventura Mall, one of the largest and most successful malls in the country, provides a significant platform for shareholder value creation," Jeff Stollenwerck, president of real estate for Sears, said in the statement.
Sears Chief Executive Officer Edward Lampert, who is also the company's biggest shareholder, is trying to turn the chain into a leaner, more digitally focused retailer. The company, which has posted nine straight quarterly losses, agreed last month to lease space at seven locations to British clothing merchant Primark Stores Ltd. In one case, Primark will take over the entire store, and Sears will move out.
Investors applauded Sears plan to create a REIT last week, sending the shares up 31 percent on Nov. 7 -- their biggest one- day increase in more than a decade. The stock gave back some of those gains today, falling 3.7 percent to $41.21 as of 9:59 a.m. in New York.