Lease let go
Avalon Mall will include store chain’s St. John’s home in multimillion-dollar redevelopment
The owners of the Avalon Mall confirmed Tuesday they have negotiated a lease buyout with Sears Canada Inc.
The owners of the Avalon Mall confirmed Tuesday they have negotiated a lease buyout with Sears Canada Inc.
Crombie Real Estate Investment Trust (REIT) says the 128,000-square-foot area will be factored into the overall mall redevelopment — a project already underway and valued at over $54 million — but it’s too early to say exactly how it will be used or who will occupy the space.
“We have a number of retailers that have expressed interest in locating to Avalon Mall because it is one of the top 30 shopping centres in Canada and the number one shopping centre in Newfoundland and Labrador,” Crombie president and CEO Don Clow stated in a news release.
“We look forward to sharing our redevelopment plans as they are completed.”
The St. John’s Sears store, which has been located in the Avalon Mall for more than 20 years, was one of 11 locations across Canada on the chopping block as announced late last week by the company. The 11 stores employ a total of 1,200 people.
Earlier this year, after obtaining court protection from its creditors, the Sears chain announced the closure of 59 stores.
That protection is set to expire Wednesday, so the company will appear in Ontario Superior Court of Justice to ask for an extension until Nov. 7.
The extension also allows the company more time to work on the potential purchase of the business as a going concern by a group led by Sears Canada executive chairman Brandon Stranzl.
However, on Tuesday, the court-appointed monitor for the company warned that its funds are running low and there may not be enough time to reach an acceptable deal with the group.
In a report to the court, the monitor says Sears is losing money weekly, but will have enough liquidity to fund operations until Nov. 7.
The report also indicates that selling to Stranzl would result in less money being paid back to creditors than would a liquidation of inventory and the sale of assets piece by piece. The group is said to be preparing a revised proposal.
The monitor supported Sears’ request for permission to sell some other business assets, including SLH Transport and three businesses under the Sears Canada Home Improvements Business umbrella, including its Sears heating and cooling sector, which exists in this province and is operated by Confort Experts.
Sears has an asset purchase agreement with Confort to take over the services entirely so there are no interruptions to customers.