CBL & Associates Properties has closed on a sale/leaseback transaction for five Sears stores and two Sears Auto Centers located at CBL malls, which will give the mall operator control of the locations involved for future redevelopment.
CBL acquired the locations for $72.5 million, the company stated. Sears will continue to operate the Sears stores under new 10-year leases, with aggregate initial base rent of approximately $5.1 million, with the retailer responsible for paying common area maintenance charges, taxes, insurance and utilities. CBL will have the right to terminate each Sears lease at any time, except November through January, with six months’ advance notice, the mall operator stated. After a lockout period of four years for the Sears store at Jefferson Mall, two years for the other four Sears stores and one year for the two Sears Auto Centers, Sears may terminate each store lease upon six months’ notice. Upon termination by either party, Sears can relocate its operations at each mall where it has operations covered under the agreement to a location of up to 15,000 square feet.
The five Sears locations acquired by CBL are in Cross Creek Mall in Fayetteville, NC, Brookfield Square in Brookfield, WI, Hamilton Place Mall in Chattanooga, TN, Eastgate Mall in Cincinnati, OH, and Jefferson Mall in Louisville, KY. The two Sears Auto Centers locations are in the Northgate Mall, Chattanooga, TN, and Volusia Mall in Daytona, FL.
“We are pro-actively transforming our market-dominant shopping centers to meet the changing preferences of consumers. This transaction provides CBL with the opportunity to redevelop prime real estate and attract exciting new uses at some of our best shopping centers,” said Stephen Lebovitz, CBL president and CEO. “The leaseback of the real estate by Sears will generate income to CBL and gives us control over the timing of closures while we finalize our redevelopment plans at each location.”
An inquiry about the deal placed with Sears Holdings was not returned by post time.