Sears Holdings (NASDAQ: SHLD) has signed a sublease with Dick's Sporting Goods (NYSE: DKS) to occupy a portion of its second floor at the King of Prussia Mall in King of Prussia, Pa., one of the largest malls in the United States. The two-story anchor building will also be renovated.
Sears will maintain exterior entrances on both levels and the mall entrance on level one. Dick's will have exclusive use of the mall entrance on level two and have its own exterior entrances.
The Sears store, on a long-term ground lease with Simon Property Group, currently occupies 215,000 square feet on two levels. Dick's will occupy the upper level.
"The sublease agreement with Dick's Sporting Goods is a great example of Sears Holdings selectively redeploying its asset base to dramatically improve our retail shopping experience while working to create long-term shareholder value," said Alan Shaw, vice president, real estate leasing and development for Sears Holdings. "King of Prussia Mall customers and our Shop Your Way members will also benefit from the sublease as we use this opportunity to enhance the store shopping experience for them."
"Sears Holdings has a long and successful history of value creation through the selective and strategic redeployment of our existing real estate base," said Jeff Stollenwerck, senior vice president and president, real estate for Sears Holdings. "We have executed a number of these transactions that serve as an additional revenue stream, drive efficiency in our store operations and bring in increased customer traffic."
Sears Holdings' real estate portfolio is among its strongest assets and monetizing it has been a big part of CEO Eddie Lampert's strategy, often at the expense of under-investing in stores. A remodeled Sears at King of Prussia represents an opportunity for the retailer to refresh the store and realign merchandise in a smaller space.
For more see:
-this press release
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