Oakdale Kmart to close; hunt on for new tenant

Kmart is closing more stores, including the one located at Oakdale’s Bergen Plaza at Tenth Street and I-694. (Linda Baumeister/Review)

Customers seeking bargains flooded the Oakdale Kmart on Wednesday, July 2 for the discount retailer’s going-out-of-business sale. The store will close for good at Bergen Plaza on September 26. (Joshua Nielsen / Review)

After 35 years, store shuttering in September

The Kmart store at Oakdale’s Bergen Plaza, just south of 10th Street North and west of Interstate 694, will be shuttering its doors this fall.

Sears Holdings, which owns Kmart, appears to be on the losing end of a battle for sales with other discount retailers such as Wal-mart and Target, as well as with heavyweight online retailers like Amazon.

While a spokesperson did not immediately respond to a request for comment, other media outlets have reported that Kmart sales have been on a steady decline since 2006 and that the company has been losing money since 2011. Sears Holdings has closed around 100 Kmart stores in the U.S. already this year, and that pattern is expected to continue.

Oakdale community development director Bob Streetar spoke with a leasing agent at Inland Real Estate Corporation last week, which owns Bergen Plaza. Streetar said Inland is actively seeking tenants for the space, but so far no one has signed a lease.

Local reaction

The Kmart store was buzzing with activity on Wednesday, July 2, just a few days after the company advertised its going-out-of-business sale. There were long lines at the check out aisles with dozens of bargain hunters leaning over shopping carts full of discounted items -- from toiletries and textiles to electronics and snack foods.

One woman, Skye from Roseville, said the store’s closing would not affect her shopping habits. She was simply there for the deals, which seemed to be the case for most customers putting up with the long lines.

“This may be my last trip here,” she says. “I may come back for one more big ticket item like a TV, we’ll see.”

She said she regularly shops at the new Wal-mart in Roseville and would like to see a Shopko store move into the soon-to-be vacant space in Oakdale.

“You don’t see the deals here like you used to. You see maybe discounts of 10 percent. I’d like to see someone come in with better offers to stretch out a dollar as much as possible.” 

A Kmart store manager declined to comment, but one employee said shoppers in recent days have been helpful -- many have offered job tips. She had not begun her job search, but added that she was sad to see the store liquidating its merchandise.

Another employee on his lunch break said management told employees they could apply at other Kmart and Sears stores in the region. He said he was a full-time student and would look for another part-time job in the coming weeks. He wasn’t sure if he would stay with Sears or seek employment elsewhere.

A few doors down at Smokedale Tobacco, store manager Dave Yousef said he didn’t have a preference as to what business occupies the large storefront, as long as it does it soon.

He said he was concerned when he heard the news in early May that one of Bergen Plaza’s other anchor stores, Rainbow Foods, was leaving the Twin Cities market, but relieved to know a Cub Foods would be taking its place.

“Those (anchor) stores do generate a lot of traffic in the mall,” he said. “You can’t have a big space like that facing Tenth Street sit empty for too long. People will think the mall has closed.”

Yousef said sales at Smokedale have been good since the store opened for business in 2007 and was optimistic that they would stay that way during the transition.

There should be ample time to find a replacement tenant, or tenants for the large space that has housed Kmart for 35 years. The store is scheduled to officially close on Sept. 26.

In the meantime many area shoppers will undoubtedly take advantage of the advertised sale of “10 to 30 percent off lowest ticket price” items, plucking them off the shelves while they still can.

Struggling stores, uncertain future

Earlier this year, Sears Holdings chairman and CEO Eddie Lampert told company shareholders that Kmart store closings would continue, a move he predicted would make the company as a whole stronger. 

On May 22 Kmart’s parent company announced its dismal financial results for the first quarter of 2014.

Sears Holdings reported to shareholders a net loss of $402 million for the first financial quarter of the year. The adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $221 million for that time period, compared to $26 million in the prior year’s first quarter.

“Sears is undergoing a significant transformation, and we fundamentally are changing the way we do business,” Lampert said in a written statement.

“Our performance in the first quarter highlights the challenges we are facing as well as the progress we are making in this transformation. We are moving away from a company that was heavily based on selling products solely through a store-based network to a member-centric business model focused on providing benefits to our members anytime and anyplace.”

The company has not announced any other Kmart store closings in the Twin Cities.

Joshua Nielsen can be reached at jnielsen@lillienews.com or 651-748-7822.


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