The locations, which Washington Prime considers Tier One assets, are: Longview Mall, in Longview, Tex.; Polaris Fashion Place, in Columbus, Ohio; Southern Hills Mall, Sioux City, Iowa, and Town Center in Aurora, Aurora, Colo.
Washington Prime Group, a real estate investment trust, said it expects to complete the transaction during the second quarter of 2018. The acquisition will provide the REIT with ownership and control of the properties for future redevelopment and Sears Holdings Corp. will continue to operate the properties under new leases. Sears Holdings has agreed to pay an aggregate base rent of $1.25 million annually, plus other common area maintenance charges, taxes, insurance and utilities.
Lou Conforti, the REIT’s chief executive officer, said, “When Washington Prime Group is presented with the opportunity to improve a Tier One asset via retrofit of an underutilized department store space, it is imperative we act accordingly….Sears will continue to operate these locations for a period of time that provides us with a suitable timeframe to evaluate the best adaptive reuse.”
Once the deal closes, Sears will have the right to end each store lease under certain conditions as provided for in each lease. Termination of the lease cannot occur between Nov. 1 and Jan. 15. Should Sears elect to no longer operate the locations, Washington Prime will have the right to end the lease upon 30 days’ prior written notice.
The REIT said, “As part of its ongoing anchor repositioning efforts, the company plans to redevelop these properties to further diversify tenancy and strengthen the asset’s dominant positioning within its respective marketplace.”