Amazon.com, Inc.’s (NASDAQ: AMZN) Whole Foods could be interested in filling as many as 110 old Sears and Kmart stores, according to CNBC, citing BMO Capital Markets analysts.
BMO Capital Markets analysts said that Amazon would be interested in filling specific stores depending on the demographic and other factors in the region. Additionally, Amazon will also look to establish stores in areas where there isn’t already a Whole Foods within a three-mile radius.
BMO estimated that there are still approximately 480 Sears stores operating, although, 80 of those stores are subject to close. Sears has almost 430 locations “available” for new users – 260 in process of closing and 170 that are vacant.
“There are plenty of Sears/Kmart boxes surrounded by high quality demographics which would be appealing to a variety of retailers and other non-retail uses (i.e. hotels, residential, creative office, etc),” BMO analyst Brandon Cheatham said. “Further, there aren’t many developers that are building additional, ground up, retail space, so if Amazon, or others, is looking to grow somewhat rapidly this would be a quick and likely cheap(er) way to expand.”
Sears was struggling with its financials over the past several years, which ultimately led the Company to declare for bankruptcy in February. Sears tried to salvage itself by launching new products, partnerships, and even closing certain locations to divest real estate. Eventually, Sears strategic moves were not enough and was delisted from the Nasdaq Exchange. Sears shares are now listed on the OTC Markets Exchange, sitting at USD 1 per share.
Reports have surfaced that Amazon is looking to open its own separate chain of grocery stores such as its Amazon Go stores as well as more Whole Foods locations. BMO said it estimates there are about 320 Sears stores that would be a good fit for Amazon’s reportedly planned “value” chain, or for a chain such as German discount grocer Lidl.