The Kmart department store that opened for customers on East Sprague during the boom years of big box retailers in the late 1960s will close in March, a casualty of bankruptcy proceedings by the Illinois-based chain’s parent company that also owns Sears.
Rental company U-Haul is set to buy the property.
Sears Holding Corp. announced the Kmart closure in a statement Friday morning, with the store at 4110 E. Sprague Ave. among the 80 Kmart and Sears locations that will shutter nationwide. That’s on top of the more than 200 stores that have previously been announced for closure earlier this year by the company. The closures will not affect the remaining Sears locations at Spokane Valley Mall nor the NorthTown Mall, and the statement indicates a liquidation sale will begin in the next two weeks at shuttered businesses.
The closure will end a 52-year run for the Kmart store at the corner of Sprague Avenue and Havana Street, a corridor that has become clogged in recent years with retailers. Kirkland-based warehouse retailer Costco set up shop at 5601 E. Sprague Ave. in 2001, followed quickly by Fred Meyer at 400 S. Thor St., a five-minute drive to the west. A Walmart store opened at 5025 E. Sprague Ave. in 2012, that chain’s second location in Spokane Valley.
Store officials at the Kmart location, the last remaining Kmart in Spokane, referred comment Friday morning to their corporate communications team. There were no signs posted indicating the news, and the retailer is in the midst of its semi-annual “blow out” sale with yellow-tagged sales items, according to advertising notices posted throughout the 113,000-square-foot store.
Friday’s statement announced the third round in a series of closures that began in October, as Sears navigates the bankruptcy process following its acquisition of Kmart stores during that chain’s bout with bankruptcy in January 2002. The holding company, which was created as part of the merger with Kmart, filed for bankruptcy protection Oct. 15. Sears Chairman Eddie Lampert’s hedge fund said it submitted a last-minute bid Friday valued at $4.4 billion to keep the struggling retailer from being liquidated.
Transform Holdco LLC, an affiliate of the ESL Investments hedge fund that Lampert heads, said it hoped to keep 425 stores open. The bid includes $1.3 billion in financing from three institutions, ESL said in a statement.
Documents filed in the case show that a purchase agreement for the site has been made between Sears and a real estate firm representing the moving equipment rental company U-Haul, which has announced its intentions to snatch up as many as 13 of the shuttered Sears and Kmart locations for expansion of its operations. The property, valued at $3.6 million, is owned by a Delaware-based subsidiary of Sears, according to county property records.
The statement released Friday from the company indicates associates were notified Thursday of the plans to close their stores. The list also includes a Sears location in Kennewick.
The statement lists “strategic transformation” and “financial restructuring” as the reasons for the closures. The company did not immediately respond to a request for comment Friday.
The East Sprague Kmart was the first to open in Spokane to much fanfare on Aug. 25, 1966, according to newspaper accounts of the event. The building cost $1.4 million in 1966 to construct, and the opening of the store brought 163 full-time jobs to the city, according to reports in The Spokesman-Review and Daily Chronicle.
The opening included a ribbon cutting and an appearance by Spokane Mayor Neal Fosseen, as shoppers lined up “more than 15 deep” at each register stand to buy goods, according to an account of the grand opening in the Aug. 26, 1966, edition of The Spokesman-Review. A similar crowd welcomed the city’s second store, at 6606 N. Division St., that November. The Division store closed in November 2011 during a previous bout of downsizing, and the property is now the home of a Lowe’s hardware store.
After decades of successful sales on Sprague, the recent years have not been kind to Kmart, which was originally founded by businessman Sebastian Spering Kresge in Detroit in 1899. The first Kmart branded store predated Walmart by four months, opening for business in Garden City, Michigan, in 1962.
By 1973, Kmart had grown to the third-largest company in the world, according to an ad the retailer took out in The Spokesman-Review on the seventh anniversary of their store opening on Sprague Avenue. But the company has been restructuring to meet the demands of an online marketplace and reduce overhead costs. According to financial filings made in September, there are only 360 Kmart stores left in operation, which includes many that are slated for closure.