MERIDEN — The Westfield Meriden mall Sears store escaped the ax Monday as the troubled retailer announced the closure of 142 stores, including two in Connecticut.
Sears Holdings, the parent company of Sears and Kmart, filed for Chapter 11 bankruptcy and announced plans to close its Milford and Waterford stores and 140 others, leaving 700 Sears and Kmart locations. Liquidation sales will start immediately and last throughout the holiday season.
Retail experts said the Meriden store’s geographic location and access to highways helped the store survive the latest round. The Sears at the Brass Mill Mall in Waterbury closed last month.
“Meriden is pretty close to the middle of the state,” said Craig Johnson of Customer Growth Partners in New Canaan. ”Right now (Sears has) a good understanding of which are their prime stores. There are about a couple of hundred stores that are in between and need to be evaluated.”
JC Penney’s exit from Westfield Meriden in 2015 helped draw traffic to the other side of the mall, said Sean Moore, president of the Midstate Chamber of Commerce.
The Meriden location is among the larger Sears stores, with a full inventory. Mall representatives referred questions about the closures to Sears.
“It’s a brand that is comfortable in Westfield,” Moore said. “Most retail sites are within a half-hour drive time. If you draw a ring around Meriden, it’s way past Hartford and New Haven. The location of this particular mall bodes well for all tenants.”
The Meriden store is owned by a trust Sears created earlier this year for the company’s real estate.
According to court filings, Sears has between $4 billion to $10 billion of value in real estate and leaseholds. As a result, liquidation was out of the question for now, Johnson said.
“It didn’t make sense at this stage of the game,” Johnson said. “There is a lot of residual value in Sears. My best guess is it could go into the billions. It’s the retail value that is pretty pathetic.”
Stock analysts want to see Sears unload Kmart, and scale its stores down to 300 to 350 premiere locations. Next, it needs to shed its soft lines and refocus on the successful hard lines.
Even retailing the Craftsman brand it recently sold to Stanley Tools will draw traffic.
“Kenmore and Diehard, “ Johnson said. “Kenmore doesn’t have the share it used to have but it’s still fourth, and people still give them credit for it. Sears should be much more focused, rather than a jack of all trades.”
Sears could continue an apparel line for work boots, clothes and work-out wear but its soft lines are losing.
It should also keep its automotive business, Johnson said.
The Danbury Sears is a model for Sears’ potential, Johnson said. Sears shrunk its footprint to allow United Kingdom-based Primemark clothing retailer to occupy half the building while it maintained limited apparel sales.
“The bottom floor has the auto center and hard lines,” Johnson said. “I think that’s the new model.”
Others don't share Johnson's optimism.
"That a storied retailer, once at the pinnacle of the industry, should collapse in such a shabby state of disarray is both terrible and scandalous in equal measure," Neil Saunders, managing director of GlobalData Retail, said in a note published by the Associated Press on Monday. "In our view, too much rot has set in at Sears to make it viable business."
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