At Heritage Place Mall in Owen Sound, Ont., an empty Sears department store would leave a mammoth void. The insolvent retailer is one of the mallB次元官网网址檚 largest occupants. More than 60 people work in the anchor tenantB次元官网网址檚 roughly 6,500 square metres, a space big enough to fit 14 basketball courts.
If the court approves Sears CanadaB次元官网网址檚 bid to liquidate its roughly 130 remaining stores, the decision will send shoppers, employees and mall owners in Owen Sound and dozens of other smaller Canadian cities scrambling to find alternative shopping destinations, jobs and tenants.
B次元官网网址淢y first reaction was: Oh, crap,B次元官网网址� said Owen Sound Mayor Ian Boddy of hearing the nearly 30-year-old location, is likely to close soon.
B次元官网网址淲eB次元官网网址檙e pretty disappointed.B次元官网网址�
A closure will hurt the local economy, he said, leaving dozens unemployed and perhaps prompting fewer people to travel to the region to shop.
Some 4,000 kilometres away on the West Coast, the mayor of Prince George, B.C., echoed those concerns about the Sears store at its Pine Centre Mall.
B次元官网网址淚t will have a direct economic impact on our community,B次元官网网址� said Lyn Hall.
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The store employs more than 60 people, he said, and sells goods and services to hundreds of thousands living in Prince George and the surrounding areas.
Both leaders wondered how their local malls would cope with an anchor tenantB次元官网网址檚 departure.
The bulk of the former juggernautB次元官网网址檚 stores are in shopping centres in communities like Owen Sound and Prince George B次元官网网址� smaller Canadian cities, where the store may serve a larger geographic area than just those living within the cityB次元官网网址檚 borders.
Of SearsB次元官网网址檚 remaining 74 department stores, all but one are in shopping malls, most in areas with populations under 400,000 and some well under that.
The malls in these so-called secondary or tertiary markets are likely to struggle to fill the vacant space in the event Sears doesnB次元官网网址檛 sell its leases or real estate to a third party, said Peter D. Morris, the founder of Greenstead Consulting Group, a real-estate consultancy firm.
B次元官网网址淚 fear some of those smaller properties may not be able to come back at all,B次元官网网址� he said, declining to speculate which of the malls may go under.
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There isnB次元官网网址檛 another big department store chain that requires that much space waiting on the sidelines, he said.
The remaining department store mall locations total more than 10.6 million square feet (nearly one million square metres). That means the select few chains like The HudsonB次元官网网址檚 Bay Company or Simons that could take over some locations have a plethora of real estate to choose from, said Morris, and likely wonB次元官网网址檛 gobble up anywhere close to all the vacant space.
For malls that donB次元官网网址檛 draw another single anchor tenant, he said, the easiest solution would be to divvy up the former department store space and woo intermediate-size shops, like athletic retailer Sport Chek or bookstore Indigo.
Another possibility, he said, is that certain restrictions in place due to SearsB次元官网网址檚 lease, like limiting further development, could disappear along with their corresponding leases and open landlords to a whole range of development possibilities. They could choose to build residential units or a mixed-use space that combines entertainment, recreation and shopping, said Morris.
However, that takes time. Consumers could find other venues with a greater selection to shop at in the interim, he said, and landlords will have to find a way to lure them back after the changes are made.
To make matters worse, for many of the malls, the Sears saga is a recurring problem. In recent history, theyB次元官网网址檝e grappled with the demise of Zellers and, more recently, Target.
Prince GeorgeB次元官网网址檚 Pine Centre Mall, for example, lost its Target location about two years after it opened when the American chain announced it would shutter all of its Canadian stores. A LoweB次元官网网址檚 Canada has since opened in the location.
The Sears vacancy B次元官网网址� at 10,400 square metres, or 24 basketball courts B次元官网网址� will leave a much larger hole for management to fill.
Mayor Hall said heB次元官网网址檚 not sure what the mall will do, but it will be quite a challenge.
Follow @AleksSagan on Twitter.
Aleksandra Sagan, The Canadian Press
