RETAIL RETRENCHMENT
Cottonwood Sears, Carlisle Kmart among latest stores for closure
Albuquerque losing Cottonwood Sears and Carlisle Kmart.
Sears at Cottonwood Mall and the Kmart near Carlisle NE and Interstate
40 are among 72 stores the company is closing nationwide.
The beleaguered retailer, which operates both Kmart and Sears stores, said Thursday it identified about 100 stores that are no longer turning a profit, and the majority of those locations will be shuttered soon.
After this round of closures, the company will have about 800 stores, down from about 1,000 at the end of last year and far below the 2012 peak of 4,000 stores.
Sears closed its store at Santa Fe Place mall last year and halved the size of its Coronado Mall store in Albuquerque two years ago.
Cottonwood lost another anchor tenant last year with the closure of the mall’s Macy’s store. The mall owner, Washington Prime,
later acquired the retail space formerly owned by Macy’s and now is engaged in a $21 million renovation.
Washington Prime might pursue a similar strategy with the Sears property at Cottonwood, which Sears owns, said Ben Perich, a senior commercial broker at Collier’s International in Albuquerque. Perich said purchasing the Sears store, which comprises 93,000 square feet on two levels, would enable Washington to consolidate its ownership at the state’s second-largest mall, which has a gross leasable area of 1 million square feet.
A mall spokeswoman expects the Cottonwood Sears to close in September.
“It’s too soon to announce the details, but we are exploring the opportunities to reposition the space,” said Cottonwood General Manager B Janecka. She did not provide details on Washington Prime’s role in the process.
Sears posted a quarterly loss of $424 million and said store closings already underway contributed to a drop of more than 30 percent in revenue. That marks more than five years of straight quarterly sales drop, according to FactSet. Sales at established stores, a key gauge of a retailer’s health, tumbled nearly 12 percent, down 9.5 percent at Kmart stores and 13.4 percent at Sears.
Rob Riecker, Sears’ chief financial officer, said in a prerecorded call that the company’s stores are “a critical component in our transformation.”
But to meet customer needs and improve financial results, Sears must close poorly performing stores and “focus on our best stores, including our newer smaller-store formats,” he said, according to a transcript of the call.