Concern for workers as Sears closing
Local store among 59 locations calling it quits, though Medicine Hat Mall management guarantees someone will fill the space
After 37 years as a flagship anchor and original tenant in the Medicine Hat Mall, Sears Canada will close its local department store as part of restructuring plan that was presented to an Ontario court this week.
The retailer had struggled for several years with declining revenue, but only this month said it was concerned it might not be able to meet financial commitments.
On Thursday it sought protection from creditors while it creates a plan of arrangement to retool the business by closing stores over the next year.
Across Canada, about 2,900 jobs will be lost, according to the company, which will close a total of 59 outlets, including some home stores and smaller outlets.
Medicine Hat is one of 20 fullline department stores the company plans to close in the coming months — about one-fifth of its current 95 major locations.
Shoppers at the local store on Thursday morning were generally unhappy with the news, though reaction ranged from hardly surprised to concern for employees and the local economy.
“What are they going to do with this place,” asked one shopper as she left with her purchases.
The Medicine Hat Mall is redeveloping about 118,000square-feet of space left vacant after the bankruptcy of Target in 2015.
Officials say plans are on track for that space to become a new foodcourt and already leased mid-sized retail bays this fall.
The plan for Sears’ 82,000square-feet will be dealt with as the process plays out.
“We know as much as anyone else at this point,” said mall manager Richard Okrainec. “We knew something might happen and now it has.
“It’s too early to discuss a contingency plan but I guarantee something will fill that space when the time comes.
“Our concern right now is with (Sears’) workers and how this is affecting them.”
Most recent available figures, from 2013, state the company had about 80 local employees.
Other major closures in Western Canada include Grande Prairie, Lloydminster, Regina and Moose Jaw.
A location in Red Deer will relocate, according to the company’s original release.
Sears Hometown locations will close in seven Alberta cities, including four near Edmonton, Okotoks and Fort McMurray.
During the Target closure, the store remained open in Medicine Hat for serval months and it took courts more than a year to determine the fate of real estate holdings and lease agreements with landlords.
Sears has applied for hopes to emerge from restructuring “as soon as possible” later this year. For that to happen it will require a settlement with affected landlords.
Sears had owned a 40 per cent leasehold share in the mall until late 2013 when it was sold to then building-owner Sleeping Bay Building Corp. for $43 million.
The mall was acquired by current owner Primaris REIT in early 2014.