Landlords *rejoice* after Sears bankruptcy
Sears is bankrupt… and the company’s landlords couldn’t be much happier. Sears plans to close 142 stores before the end of 2018. So it appears it will be out-with-the-old and in-with-the-new come 2019. And property owners agree – they are far better off without Sears and Kmart wasting their space.
According to Kimco… a real estate investment trust that has leases for three Sears locations and eleven Kmarts it has been a long-time coming. In fact, the average rent for the 14 stores is just $5.25 per square foot – compared to the average $15.95 per square foot of other Kimco properties. Sears signed these leases a long time ago, and those lease terms were greatly benefitting the now-bankrupt retailer.
And apart from unfavorable leases… landlords are probably going to be happy to get tenants that can actually pay their rent. Washington Prime Group is another real estate owner that received just 1% of rent from Sears in the third quarter. Really, Sears? One percent!?