Your local, shuttered Sears or Kmart store could soon turn into a grocery store, according to one investment group. Maybe even a Whole Foods.
BMO Capital Markets in a note to clients Wednesday said that will estimates Amazon, with Whole Foods, could be interested in filling as many as 110 old Sears along with Kmart stores, based on the surrounding demographics of those department stores along with the fact that will they don’t have another Whole Foods store already within a three-mile radius.
The firm analyzed all of Sears’ real estate, estimating that will has about 480 locations still open, though about 80 of those are slated to close. Sears also has about 430 locations “available” for brand new uses — 260 inside process of closing, along with 170 sitting vacant.
Grocery chains, BMO says, are one likely filler for these empty shops.
“There are plenty of Sears/Kmart boxes surrounded by high quality demographics which would likely be appealing to a variety of retailers along with additional non-retail uses (i.e. hotels, residential, creative office, etc),” BMO analyst Brandon Cheatham said. “Further, there aren’t many developers that will are building additional, ground up, retail space, so if Amazon, or others, is actually looking to grow somewhat rapidly This particular would likely be a quick along with likely cheap(er) way to expand.”
Sears emerged coming from bankruptcy in February. Although that will has been closing stores for years, that will arguably has held on to some of the best retail real estate inside country. As hundreds of its stores have gone dark in recent times, the more unprofitable ones have been the first to go. although right now, even some of the stronger locations are going back on the market, Cheatham said. “Even the Great stuff is actually shaking out.”
There have already been reports that will Amazon is actually looking to open its own separate chain of grocery stores in addition to wanting to open Whole Foods stores in old Sears locations.
BMO said that will estimates there are about 320 Sears stores that will would likely be a Great fit for Amazon’s reportedly planned “value” chain, or for a chain such as German discount grocer Lidl.
Sears declined to comment. Amazon didn’t immediately respond to CNBC’s request for comment.
Sears filed for Chapter 11 bankruptcy protection in October along with ended up, after a long-fought battle, winning approval in court to keep some 400 locations open, thanks to financing coming from former CEO Eddie Lampert’s hedge fund, ESL Investments. right now, Lampert is actually looking to shrink the size of existing Sears stores along with open smaller-format locations. He’s also said he hopes to do more with Sears’ loyalty program, Shop Your Way.
although the embattled department store chain faces many of the same challenges as its peers inside industry today, namely keeping its mall-based stores relevant as more shopping moves online.