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Sears decided to not renew a lease at 2969 Faye Road, which was built for its use in 2008.
Jax Daily Record Monday, Apr. 17, 2017 2 months ago

Pattillo listing 815,000-square-foot Sears warehouse for lease

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by: Karen Brune Mathis  Managing Editor

Sears decided not to renew its lease at the 815,000-square-foot North Jacksonville warehouse it rents from Pattillo Industrial Real Estate, so the building will be available for new tenants in March.

Pattillo Vice President Peter Anderson said Monday the lease with Sears will expire and the department store chain has not committed to renew it.

Chris Brathwaite with Sears said the company made a business decision not to renew the lease. "That said, we have other facilities in the Jacksonville area and in Florida that are part of our network of warehouses and distribution centers serving our supply chain needs," Brathwaite said.

The structure was built at 2969 Faye Road in 2008 for Sears’ use, Anderson said.

Sears, based in Hoffman Estates, Ill., has been closing its Sears and Kmart stores in an effort to stay in business.

Anderson said he believes the structure to be the largest industrial building available for lease in the state. It is assessed at $28.8 million for tax purposes.

He is listing it with the CoStar service used by commercial real estate firms nationwide.

Anderson said the property will be attractive to industry because of the available labor pool in the surrounding Northeast Florida area and the site’s proximity to the Jacksonville Port Authority marine terminals, Jacksonville International Airport and Interstates 295, 95 and 10.

“Given the massive truck yards on the property it will likely be used by a distributor interested in serving the entire state of Florida via next day truck service, as well as markets served by JaxPort internationally,” he said.

To market the property, Anderson said Pattillo will work with members of the NAIOP Commercial Real Estate Development Association Northeast Florida Chapter, JAXUSA Partnership economic development division of Jax Chamber and the city Office of Economic Development.

Sears, based in Hoffman Estates, Ill., owns two buildings in Jacksonville, records show.

Sears, Roebuck & Co. owns the closed department store building in Regency Square Mall. That 196,214-square-foot store closed July 17 after about 36 years in business.

Among its largest holdings, Terminal Freight Handling Co., a Sears, Roebuck company, owns a retail replenishment center at 1 Imeson Park Blvd. in Imeson International Industrial Park in North Jacksonville.

Property records show the 734,544-square-foot warehouse was built in 1990.

Sears also developed a 1.7 million-square-foot office-warehouse in Imeson in 1974 as a catalog sales distribution center, but sold it to investors in 1994.

Sears, Roebuck & Co. also owns its department store at the Orange Park Mall.

Sears Holdings Corp., which owns Sears and Kmart stores, has been closing its locations.

In its last fiscal year, which ended Jan. 28, revenue fell to $22.1 billion in 2016 from $25.1 billion the prior year. Of that, $1.3 billion was attributed to the closing of Kmart and Sears full-line stores. Comparable stores – those that remained open – saw sales drop $1.4 billion.

Kmart’s sales dropped 5.3 percent for the year and Sears store sales fell 9.3 percent.

Kmart saw declines in grocery, household, consumer electronics and the pharmacy. Sears saw sales decline primarily in home appliances, apparel and consumer electronics.

Since last April, Sears has closed its last three Kmart stores in the area as well as the Sears at Regency Square Mall.

Sears continues to operate department stores in The Avenues and Orange Park malls.

In late March, Fortune.com reported that since 2011, Sears Holdings has lost $8.2 billion as it experienced a nearly $40 billion drop in sales.

To stay afloat, Sears raised $12 billion since 2012 by selling off real estate and spinning off assets.

Fortune said that deals could be invalidated if the company was insolvent either during or as a result of the transaction, “which would likely amount to a deathblow to a company that can’t seem to find revenue anywhere else. Even if the deals end up standing, Sears is running out of assets to sell and brands to spin off.”

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