Dive Brief:
- Sears and Kmart owner Transformco plans to put its corporate campus near Chicago on the real estate market next year, according to local media reports and confirmed for Retail Dive by Kevin Kramer, director of economic development for Hoffman Estates, where the campus is located.
- Sears originally moved into its headquarters in Hoffman Estates, Illinois, in 1992, leaving behind the Sears Tower names for the retailer.
- A company spokesperson told the Chicago Tribune that Transformco was "exploring development opportunities for the Hoffman Estates property that enhance its value for both associates based there and the broader Hoffman Estates community."
Dive Insight:
For more than a decade, Transformco and its predecessor, Sears Holdings, have held an ongoing asset fire sale as the retailer's sales base shrunk at a rapid, continuous pace.
Only a few full-line Sears department stores and Kmarts remain today. This fall, the company closed the last Sears department store in its home state of Illinois. Shortly later, it moved to close the last Michigan Kmart, which started with a five-and-dime store in Detroit.
Less than a decade ago, the combined number of Sears department stores and Kmarts numbered in the thousands. The dismantling of the Sears empire began before Eddie Lampert took over Sears Holdings leadership and majority ownership. Since Lampert's involvement, though, the liquidation of the company has occurred at an astonishing pace. And in many cases, Lampert has been on both sides of a sale, actions that have become the target of litigation since Sears Holdings went into bankruptcy in late 2018.
Lampert and ESL Investments, his hedge fund, own the remaining Sears and Kmarts today through Transformco. The company has said it sees its future in smaller specialty formats, including Sears Hometown and Home & Life stores, as well as its loyalty program Shop Your Way.
Sears spokesperson Larry Costello told the Tribune that corporate headcount and operational reductions "reduced our needs for a corporate campus that was built 30 years ago for the needs of a more centralized business."
In past filings, Sears Holdings said the Hoffman Estates campus contained some 200 acres with six interconnected office buildings and roughly two million square feet of office space. According to the Tribune, the site includes 100 acres of undeveloped land.
Other retailers have also sought cash from the sale of their corporate real estate. Apparel conglomerate Ascena Retail Group sold its headquarters in early 2020, not long before the retailer filed for bankruptcy. Belk, which went through a bankruptcy this year, has sought to sublease its corporate office space in North Carolina. J.C. Penney sold off its headquarters property in 2017 in a lease-back transaction meant to save and raise cash.
It's not clear where Transformco will seek new offices. Sears has been based in or around Chicago since the late 19th century.
Editor's note: This story was updated to include confirmation from the local government about Transformco's plans to sell its headquarters property.
via https://www.aiupnow.com
Ben Unglesbee, Khareem Sudlow
