Sears at Northshore Mall to close

File photoSears, one of the nation's oldest retailers, will close about 60 more stores in the near future, including the Sears' Peabody outlet in the Northshore Mall.

PEABODY — Sears, one of the oldest stores at the Northshore Mall, will close in early September, its parent company announced Thursday.

The Peabody store is one of 63 that will be shut down in the latest round of closures by the beleaguered retailer, which operates Sears and Kmart stores. The company closed 103 stores earlier this year.

The announcement of the Peabody store closing was expected after a developer filed plans earlier this month to build a fitness center and outdoor pool near the site of the current Sears.

"It's tough for the employees, but I don't think anybody is terribly shocked," Peabody state Rep. Tom Walsh said. "To the mall's credit, they didn't sit around waiting for the demise. They're already looking ahead to what the future of that whole area will look like."

Sears has been a tenant at the Northshore Mall since the early 1960s and has been a "good employer" for many local people, Walsh said. The company said eligible employees will receive severance and can apply for jobs at other Kmart or Sears stores.

City officials have said the company building the new fitness center, Life Time Inc., wants to dismantle the Sears building by year's end and begin construction next spring.

Plans calls for an upscale, three-floor gym with three indoor pools and an outdoor pool, yoga studios, basketball courts, a bar and cafe, and a child care center. The current Sears site will become a parking lot. There will also be a new entry to the mall, with restaurants on both sides.

"For malls to survive they have to be more than just retail now," Walsh said. "That's what they're moving forward with the restaurant row and the fitness center. I think it's a good mix."

The closings announced Thursday include 48 Sears and 15 Kmart stores. Besides Peabody, the only other Massachusetts store in the announcement was a Sears in Springfield. The Sears Auto Center at the Northshore Mall was not included on the list of closings.

After this recent round of closings, Sears will have about 800 stores, down from about 1,000 at the end of last year and far below the 2012 peak of 4,000 stores. The company posted a quarterly loss of $424 million and sales dropped nearly 12 percent.

Rob Riecker, Sears’ chief financial officer, said in a pre-recorded call that Sears must close poorly performing stores and “focus on our best stores, including our newer smaller-store formats.”

The latest closings underscore the deep-rooted problems at Sears, which was once a powerhouse retailer that survived two world wars and the Great Depression but has been calving off pieces of itself as it burns through money.

“The demise of Sears has felt like a prolonged, drip, drip, drip as evidenced by the string of quarterly sales numbers,” said Mark Hamrick, Bankrate.com senior economic analyst. “Essentially, it has been injury by a thousand cuts, whether by failing to staff stores to provide customers with good experiences or by failing to stock better quality merchandise in its stores.”

Chairman and CEO Edward Lampert, who combined Sears and Kmart in 2005 after helping to bring the latter out of bankruptcy, has long pledged to save the famed retailer, which started in the 1880s as a mail-order catalog business.

But the stores have remained an albatross. And Kenmore, the retailer’s renowned appliance brand, became the latest potential sale after ESL Investments, the company’s largest shareholder, headed by Lampert, said it might be interested in buying it.

Staff writer Paul Leighton can be reached at 978-338-2675 or pleighton@salemnews.com. Material from The Associated Press was used in this story.

 

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