• News
  • Real Estate

Former Sears Essentials stores gaining new life

The 94,500-square-foot former Sears Essentials store space at 7655 Clairemont Mesa Blvd. and Convoy Street is being filled in September by a Zion Market, while tenants for other former Sears Essentials properties have yet to be named.

Zion Market, a Los Angeles-based grocery store chain that sells Asian produce, is scheduled to vacate a 34,000-square-foot space at 4611 Mercury St. in Kearny Mesa on Aug. 30. A replacement tenant for that space has not been identified.

Bill Thaxton, a Flocke & Avoyer senior vice president, said he feels Zion should fare well at its new location, and that the old space should be re-filled in relatively short order as well.

“There are some other Asian markets that do really well in that area,” Thaxton said. “It’s a great, centralized location with the 805 and the 163 (freeways) coming together.”

As noted by The CoStar Group, the new Zion lease is for 11 years. The terms of the transaction were not disclosed.

The Clairemont Mesa Boulevard property is owned by a unit of McGrath Development Inc. of San Diego. The lessee was represented by Argent Retail Advisors and Green Light Commercial. CBRE (NYSE: CBG) and McGrath Development were also involved in handling the lease transaction.

McGrath properties also include the 97,000-square-foot McGrath Commerce Center on Shawline Street in Kearny Mesa.

Another property at 12080 Carmel Mountain Road is still being leased by Sears Essentials, according to CoStar. While this property was placed on a closure list months ago, it is in the process of being converted to another retail use. At last report, that space was expected to be converted into a Sears Outlet Store.

The Carmel Mountain Ranch property is owned by a unit of New York City-based Lexington Realty Trust. Calls to Lexington were not returned Thursday.

Thaxton, who has said more than once that the Carmel Mountain Ranch location is excellent, said he believes it probably makes the most sense for one rather than multiple tenants to occupy the property.

The Sears Essentials brand, which opened in scores of non-mall locations, but over the course of the next few years, the stores, which averaged about 100,000 square feet, faltered.

The first 25 Essentials stores opened in the spring of 2005. They included the Clairemont Mesa, the Carmel Mountain Ranch store, the Spring Valley store a Mission Valley store, and a former Kmart store at 5405 University Ave. in the College area. Sears (Nasdaq: SHLD) announced at the time it would be keeping all of the former Kmart employees but that was before the announcement earlier this year that it would be closing the Clairemont Mesa and Carmel Mountain Ranch locations.

As explained by Michael Moser, a CBRE senior vice president who represents Sears, Sears Essentials stores in Mission Valley, Spring Valley and on University Avenue have since been converted to KMarts. In the case of the University Avenue space, the primary leasehold was shrunken to include a KMart and Northgate Market.

These won’t be the only changes involving Sears properties. Moser said the retailer is looking for ways to better utilize its square footage by leasing out space within its stores. The 195,000-square-foot Sears at the University Towne Centre mall will be the first to receive this treatment.

Moser said while it is too early to name tenants, they are expected to include restaurants and multiple retailers along La Jolla Village Drive.

“Corner Bakery is already in,” Moser said.

“Sears is going to do this where it makes sense,” Moser added. “A lot will depend on the layouts of the stores.”

Sears isn’t the only retailer that has been exploring leasing space within its stores. Best Buy (NYSE: BBY), which announced last month that it would be closing 50 of its big box stores across the country, is also trying to figure out ways to sublease space in its stores as well.

User Response
0 UserComments