H Mart CEO Buys Former Kohl’s Store in Fremont

An East Coast group linked to Vornado Realty Trust and an H Mart executive has emerged as the buyer of a shuttered Kohl’s location in Fremont.

An entity led by Il Yeon Kwon, CEO of H Mart, purchased the decommissioned department store at 43782 Christy Street in an $18.3 million all-cash deal, the Mercury News reported. The property has an assessed value of $26.1 million, according to county documents cited by the Mercury News. Commercial real estate firm Lockehouse, an affiliate of Chicago-based Heitman Capital Management, represented the seller. One of the addresses for the affiliate that bought the property is the New York headquarters of Vornado Realty Trust.

Kohl’s shut down the 98,000-square-foot retail property in April. It was one of several stores in California that Kohl’s closed along with Bay Area locations in Mountain View, Napa, Pleasanton and San Rafael as it cuts down its real estate holdings with underperforming stores across the country.

H Mart has been in a growth spurt in the Bay Area over the past decade. In 2017, it opened its first Northern California location in San Jose, followed by another outpost in San Jose and a San Francisco location. Its first East Bay store is slated to open in Dublin, a few miles north of Fremont.

In 2022, Kohl’s considered cashing in on its entire real estate portfolio, valued at the time at approximately $8 billion. Activist investors such as Macellum Advisors GP, Ancora Holdings, Legion Partners Asset Management and 4010 Capital urged Kohl’s to shed some of its real estate and consider sale-leaseback deals while reducing its inventory. For a period of time, Kohl’s was in an exclusive negotiating agreement with Franchise Group to buy the properties, though Kohl’s let the exclusivity period end as it was “reevaluating monetization opportunities for portions of the company’s real estate portfolio.” That same year, private equity firm Oak Street Real Estate Capital offered between $1.5 billion and $2 billion for Kohl’s properties, though a deal never materialized from those talks.

— Chris Malone Méndez