CBL Snags 7 Sears Outposts for Redevelopment
- Feb 01, 2017
Chattanooga, Tenn.—CBL & Associates Properties Inc. takes a big step forward in its redevelopment program with the acquisition of seven Sears retail locations at CBL malls in the South and Midwest. The company purchased five department stores totaling 900,000 square feet and two Sears Auto Centers from the retail giant in a sale-leaseback transaction valued at an aggregate $72.5 million.
“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,” Stephen Lebovitz, president & CEO of CBL & Associates Properties, said in a prepared statement.
The Sears department stores are located at CBL’s Cross Creek Mall in Fayetteville, N.C.; Brookfield Square in Brookfield, Wis.; Hamilton Place Mall in CBL’s hometown of Chattanooga, Tenn.; Eastgate Mall in Cincinnati, Ohio; and Jefferson Mall in Louisville, Ky. The two auto centers involved in the transaction can be found at Northgate Mall in Chattanooga and Volusia Mall in Daytona, Fla.
Sears will stay put in the spaces, paying annual initial base rent totaling just more than $5 million. Each new lease is for a 10-year term; however, both CBL and Sears have termination rights. “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,” Lebovitz added.
CBL’s list of completed transformation projects includes Sears anchor spots at Coolsprings Galleria in suburban Nashville; Fayette Mall in Lexington, Ky.; and College Square Mall in metropolitan Knoxville, Tenn., where the Sears site reopened as a TJ Maxx.
It’s not just Sears that’s a target of CBL’s redevelopment program; Macy’s loss is the mall owner’s gain. In January, CBL announced it would transform four Macy’s anchor stores that are designated for closure in March of this year.
As of the close of the third quarter of 2016, CBL’s conversion projects since 2013 totaled 1.5 million square feet of anchor space with an investment value of $250 million.