Struggling store Sears Canada has sold back the lease of its Yorkdale Shopping Centre location, prompting prospective retailers, such as Quebec-based Maison Simons, to eye the space that could be vacated by March 31, 2014.
Amid fevered speculation, Nordstrom and Seattle-based Saks Fifth Avenue spokespersons denied that the companies have an interest in occupying the space. However, the Sears move cast a shadow on Yorkdale mall’s recently announced expansion plans after reports surfaced that a RBC Dominion Securities and RBC Capital Markets analysts’ research note suggested Yorkdale might shelve its expansion and move anchor store Nordstrom into the vacant location.
Peter Simon, president and chief executive officer of Maison Simons, said his department store entered talks with Yorkdale co-owners Oxford Properties Group and Alberta Investment Management Corp.
If negotiations are successful, Maison Simons might occupy most of the 118,000-square-foot space but not all of it.
Sears’ pullout from Yorkdale comes after 12 years of operation and was coupled with the announcement of a similar deal made with the landlords of Square One Shopping Centre in Mississauga.
In total, Sears’ agreements created a total revenue of $191 million for Sears. Another $54 million is possible if a similar deal is made with the owners of the Scarborough Town Centre.
In a prepared statement, Calvin McDonald, president and chief executive officer of Sears Canada, suggested the company stood to make more money by selling its lease than it would by continuing to operate.
“We were presented with an opportunity that gives us significant financial benefit without changing our plans to improve the business and make Sears more relevant to Canadians,” he said.
Current employees would be offered positions at other locations. When asked if the Sears location at Fairview Mall might close, a spokesperson for owner Cadillac Fairview gave no comment.