Nearly five years after Sears filed for bankruptcy, the company it spun off in the process is reportedly weighing its own fate.
Real estate investment trust Seritage Growth Properties is considering strategic alternatives, including a sale of the company, people familiar with the matter told Bloomberg. The New York-based REIT is reportedly working with Barclays on the plans for the trust’s future.
Plans aren’t finalized and could be reeled in at any time, Bloomberg noted. Seritage, however, is reportedly open to either a full sale of the company or a sale of its assets, piece by piece.
The company has interests in 170 properties, spanning approximately 10 million square feet of gross leasable area. As of the close of the market on Feb. 25, the REIT had a market value of about $402 million and its shares have dropped approximately 54 percent year-over-year.
While private equity firms and real estate companies could snap up Seritage, Bloomberg reported another potential buyer is company chairman Eddie Lampert. The former Sears CEO has a 22.1 percent interest in the company with about 9.3 percent of Class A shares as of the third quarter.
Seritage was formed with the acquisition of a retail portfolio from Sears in 2015, three years before the department store filed for bankruptcy. Andrea Olshan stepped down from her executive post at Olshan Properties one year ago to become CEO of the company.
Bloomberg reported in June that Seritage was looking to unload 40 to 50 former Sears properties to generate cash and help the REIT concentrate on redeveloping its remaining sites. Olshan wanted to liquidate those assets so the company would have time to recruit tenants and redevelop sites.
Looming over Seritage is a $1.44 billion loan from Berkshire Hathaway. The loan has been renegotiated, according to Bloomberg, but is still set to mature in 2025.
[Bloomberg] — Holden Walter-Warner