Community Chat

[chlema]

@gardenman Prices Corner is not the same as it was in the past.  Many stores have closed - Radio Shack, the record store (forget its name), the QVC store, gone.  Miss that one even tho it was a junky store you could really get some good bargains.  They are hoping Target will save them, along with a Chick-fillA (sp) lol.  Have heard nothing about what will be on the second floor of Sears, just that it may be divided.  Interesting.  Funny thing Sears just sent me a new credit card  - why say I.

[OnlyShopsOnline]

We always bought our appliances from Sears. You could get just about any brand, and they could get any color. With other stores, you were limited to what they showed on the floor. 

Then Whirlpool left. When we bought our new Kenmore stove, it was made by Electrolux. Worst performing stove ever. 

Then more and more stores started closing. That kind of news is kind of self fulfilling. I hear it, so I don't go back at all. We bought our new washer and dryer from Best Buy...they would not have been my first choice, but they had the models we wanted. 

Many years ago, I thought Sears would have benefited from just selling appliances, tools, and lawn care items. But nobody asked me, lol. 

[GenXmuse]

I didn't realize any were still open 

Sears wasn't the store my family shopped at anymore and it didn't modernize in a way that made sense so it's been gone for me for many years. 

[speedy girl]

We used to buy all our appliances there and they were always so good. In fact most of my Kenmore items never broke down, I just got sick of them! Not like today's appliances at all. And my Dad always bought their craftsman tools. He sure loved them and now we have many of them which still work great. 

[Spurt]

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@novamc1 wrote:

@Spurt 

Eddie Lampert wanted to own Sears because of its real estate, as you mentioned.

But I wonder now, as the retail environment has changed so much due to online merchandising and so many shopping centers and strip malls are lacking tenants, whether he still likes his commercial real estate quite as much.

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@novamc1 

By the end of last quarter, Seritage had just 52 Sears and Kmart stores left at its properties, including joint venture properties. The most recent round of cutbacks by Sears and Kmart involves closing 29 of those locations, primarily in California and Florida.

Under its current agreement with Seritage, ESL has the right to terminate leases for up to 16 properties in March 2020. It plans to do just that. For the other 13 stores being closed, ESL must pay a termination fee equal to one year of rent and estimated expense reimbursements.

The good news is that the annual base rent for these 29 stores combined is just $8.3 million. For comparison, Sears and Kmart accounted for more than $150 million of rent on an annualized basis back in 2015. That figure has since fallen to less than $20 million. The Sears and Kmart stores that will remain following these closures and a handful of pending asset sales and store recaptures will generate $9.6 million of rent annually for Seritage.

An insignificant headwind

Sears and Kmart will continue to pay full rent for the space they are vacating until March 1. Seritage will also receive a termination fee of several million dollars.

Meanwhile, in recent quarters, Seritage has averaged new lease signings worth about $12 million in annual rent. By the end of last quarter, its backlog of signed leases for tenants that had yet to open, and thus aren't paying rent, totaled $89.4 million of annual base rent. The majority of this revenue stream will come on line by the end of next year.

Sears filed for bankruptcy protection last fall. While controlling shareholder Eddie Lampert kept the company from going out of business entirely, the bankruptcy led to another wave of store closures -- and some rent reductions, too.

As a result, Seritage's adjusted FFO (funds from operations) collapsed, forcing the REIT to suspend its dividend earlier in 2019 to conserve cash.

Funds From Operations are finally stabilizing. And with lots of big redevelopment projects slated for completion over the next few quarters, Seritage should benefit from strong FFO growth beginning in early 2020. Thus, Seritage is poised to start reporting rapid growth in revenue, net operating income, and other key financial metrics next year. The closure of more than half of its remaining Sears and Kmart stores will be a small blip in that growth story, but nothing more.   

[DearPrudence]

It was announced yesterday that the last remaining Kmart in Illinois will be closing in April. I can remember when that land was still an onion farm! No one had heard of Kmart when they built it.

[Twins Mom]

Over 35 years of always going to Sears for any appliances, tools, and Lands End when they took that on.  And the portrait studio is where all my kids were taken for age milestones.  Catalogues were before their time - I would bring  home and kids would circle and cut out their choices for wish books.  Quality for appliances was always emphasized, as was availability of parts.  It is very sad to see a part of everyday life that worked become a thing of past.  How can I try on Lands End?  Love their swimsuits!

[aubnwa01]

They just announced last week that the one remaining Sears  here at Tucson Mall will be closing in April.  I hadn't been in there for several years, but the last time I was it was pretty sad looking, so I'm not really surprised. 

[lovesrecess]

I prefer Kenmore Elite appliances to any other brand. I think I read that brand was sold to someone else. Most boomers, like myself, grew up with Sears...it had everything...and the catalog was our “online shopping” but it was a telephone line! My mother ordered from it all the time.

[ECBG]

All of my appliances came from Sears.  We had to get a new washer and dryer a month ago and got them from Best Buy.