Report: Sears pushes to lease space to outside retailers
Hoffman Estates, Ill. — A Friday report by Wall Street Journal said that Sears Holdings Corp. is in an active push to lease surplus space to other retailers. Its real estate division has listed on its website some 4,000 of its namesake and Kmart stores that have space for other merchants or retail operations to lease.
According to Thursday’s report, Sears has secured two lease deals, one with Western Athletic Clubs for 69,000 sq. ft. of a 273,000-sq.-ft. Sears store in Cupertino, Calif. The health club is expected to open in December 2012.
In the second deal, a specialty grocer – Gonzalez Grocery – has leased 41,000 sq. ft. of a 104,000-sq.-ft. Kmart store in San Diego, with plans to open in November.
Last year, Sears leased about 15% of the space in its Costa Mesa, Calif., store to Forever 21.
Yigal Azrouel to open first freestanding store in Soho
New York City — Apparel designer Yigal Azrouel will open its first freestanding store, for its Cut25 lower-priced, younger collection, in the Soho South area of Manhattan.
Prudential Douglas Elliman’s Retail Group arranged a lease at 129 Grand Street, between Broadway and Crosby Street, for the new store. The opening date hasn’t yet been announced.
Target finalizes its real estate in Canada; signs deal with Sobeys
Minneapolis — Target Corp. said Friday that it has finalized its real estate transaction with Canadian retailer Zellers with the selection of 84 additional Zellers leases. Target Canada will open between 125 and 135 stores, most by 2013. The discounter also entered into a deal with Sobey’s, Canada’s second largest supermarket chain, to supply its stores with food.
The latest lease acquisition brings the total number of leases selected to 189. From the 84 latest leases, Target said it has acquired the leasehold interests for 29 locations, the vast majority of which will open as Target stores beginning in 2013. The remaining leases have been or will be sold to other Canadian retailers or back to landlords.
Target announced in January that it would purchase, for $1.84 billion, the leasehold interests of up to 220 sites currently operated by Zellers, a subsidiary of Hudson’s Bay Co. In May, Target selected an initial group of 105 leases, with most rebranding to Target stores beginning in 2013.
The 84 leases announced Friday are part of Target’s second and final selection, and include the 39 leases for which Target transferred the rights to Walmart, as announced in June. As part of its transaction with Walmart, Target acquired the lease for one of Walmart’s vacant properties, which will open as a Target store.
Target also said Friday it had signed a long-term wholesale supply agreement with Sobeys to supply its stores with select food and grocery products.