Sears closing flagship Eaton Centre store, and four more
By: Faiza Amin and Rachel Landry
Sears Canada has announced it will be closing five stores in Canada, including its flagship location at Toronto’s Eaton Centre.
All five locations are owned by the Cadillac Fairview Corporation, a Toronto-based property management company. Cadillac Fairview offered a $400-million dollar deal that includes buying the leases back on five department stores across Canada. The deal will affect 965 employees.
Humber News spoke to Sears Canada spokesperson Vincent Power about the decision to close those locations. He said the offer to terminate the leases of the five stores was brought to them by the landlord.
“We considered it because the value of the offer was substantially higher then we felt we could make in the stores,” he said.
The affected locations include Sherway Gardens in Toronto, London-Masonville in London, and the outlets in Markville Shopping Centre in Markham and Richmond Centre in B.C. The outlet stores are slated for closure in 2015, while the three other stores are scheduled to close by Feb. 28, 2014.
Power is confident that, although there are a number of employees who will lose their jobs, there will be other opportunities for them.
“Retail has quite a bit of turnover compared to other industries,” he said. “It’s possible that those people will be able to be placed in other Sears locations.”
He said “hopefully there will be opportunities for people there as well” with whoever takes over the spaces that Sears is vacating.
Doug Stephens, a retail industry analyst, said the store closures are consistent with reports saying Sears has been declining for years.
“When you start closing your primary stores without any sort of clearly articulated strategy going forward, that’s a worry for me,” Doug Stephens told Humber News.
LISTEN: The future of Sears
Power said when the five locations close, Sears will still have 111 department stores across the country.
“Even if you think of just our 111 department stores, we’re still bigger than our major department store competitor,” he told Humber News. “Although today’s announcement is affecting some Toronto locations, we’re still very much a national retailer and a place where Canadians love to shop.”
The company has occupied space at the Eaton Centre since 2000 and that location is one of the company’s most visible stores in the country. Sears closing their bigger stores is a recipe for disaster, Stephens said.
“There are six cities in Canada that represent the vast majority of population growth and if you’re not growing and active in those cities, you are becoming obsolete,” said Stephens.
In the last quarter in August, Sears reported revenue sales fell 9.6 per cent from the previous year.
Stephens said more and more Canadian Sears stores are facing closures because the company is no longer able to compete with other retailers.
“I don’t think this is some stroke of genius and all part of the master plan to resurrect the Sears brand,” said Stephens. “I think this is simply a fight for survival.”