Sears will close its Northgate Mall store in February, two months after it shuts down its store at Hamilton Place Mall at the end of the year, as what was once the world's biggest retailer exits the Chattanooga market.
Sears Holding Co. announced today it is closing another 40 Sears and Kmart stores in early 2019 "to accelerate its strategic transformation and facilitate its financial restructuring." Among the stores being closed is the Sears outlet at Northgate Mall in Hixson where Sears was one of the original anchors of the mall when it opened in 1972.
After years of struggling against online retailers, discount chains and boutique stores, Sears filed for bankruptcy in October and announced plans to close 142 unprofitable stores by the end of the year, including the Sears store at Hamilton Place Mall.
Sears told employees of another 40 stores today that they will lose their jobs by February. Liquidation sales at the 40 latest stores to close will begin late next week, the company said in a statement.
The additional store closures come as Sears looks for more money to stay in operation while it tries to find a potential buyer to avoid liquidation.
Sears had interim approval for $300 million in emergency financing and was in talks with hedge fund ESL Investments for another $300 million loan, according to bankruptcy filings by the Chicago-based retailer in its ongoing Chapter 11 proceedings.
But CNBC reported today that talks with ESL, which is led by Sears chairman Eddie Lampert, have stalled over disagreements about who has first claim on some of Sears' few remaining assets.
After the latest round of closings, Sears will operate fewer than 500 stores. At its peak in 2005, the 130-year-old retailer operated about 2,300 Sears brand stores and 1,600 Kmart stores.
Sears and Kmart once operated more than a dozen stores in the Chattanooga region. The last remaining Kmart in the region closed early this year in Dalton, Georgia.
In early 2017, CBL & Associates Properties, the Chattanooga-based shopping center developer which owns Hamilton Place and Northgate, acquired the Sears store at Hamilton Place and the Sears automotive center on an outparcel at Northgate Mall. The auto center was torn down earlier this year and is being replaced with new Panda Express nd Aubrey's restaurant locations.
"We started preparing for their (Sears) bankruptcy in 2013 when we purchased the first two Sears for redevelopment (at other CBL centers)," CBL President Stephen Lebovitz said last month.
But the Sears closing at Northgate will leave the Hixson mall with two of its original anchors shut down and vacant. The J.C. Penney store at Northgate closed in 2014.