Sears (NASDAQ:SHLD) has entered a lease agreement with Primark, a European fashion retailer, at seven of its standalone stores. Sears will continue to occupy 100,000 sq. ft. of shopping space at six of these locations.
Primark will lease from Sears a total of about 520,000 sq. ft. in mall-based stores located in the Northeastern part of the United States. The space will be turned over in the next 12 to 18 months.
"Partnering with a globally recognized brand such as Primark to help establish its store base in the northeastern United States is testimony to both our attractive store locations and our focus on transforming Sears by working with other retailers, mall owners and brands," said Edward Lampert, chairman and CEO of Sears.
The first Primark location will be in the King of Prussia Mall in King of Prussia, Pennsylvania. The location already hosts a Dick's Sporting Goods in 75,000 sq. ft. of the store's upper level. The location will no longer operate a Sears retail store or auto center at all in that mall.
Another anticipated location for leasing space is at the Staten Island Mall in Staten Island, New York. This Sears location will continue to operate as the brand, minus 70,000 sq. ft. that will be taken over by Primark.
The strategic move comes on the heels of new reports indicating that insurers to vendors are reducing coverage on orders to Sears. In retail, this often indicates the beginning of the end. But Sears contends it has the resources to continue. Last month it announced plans to sell most of its stake in Sears Canada valued at $380 million, and Lampert loaned Sears $400 million from his own hedge fund, ESL Investments.
-See this Sears press release
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