Sears Canada leases spark interest among REITs

Two heavy hitters in the Canadian real estate market are eyeing Sears Canada properties — but not its Home Stores.



RioCan Real Estate Investment Trust, and a unit of H&R Real Estate Investment Trust are among potential bidders interested in Sears Canada assets. They are two of the biggest players in the Canadian real estate marketplace, according to Bloomberg.



The two REITs are not looking at the chain’s Home Stores division. Factors that could be influencing decision include that these units are “older and harder to subdivide, and haven’t been renovated, which could potentially cost [them] millions of dollars,” the report said.



The chain has been ailing for years, burdened with an outdated image and under increased competition from online and discounters. In June, Sears Canada filed for protection from its creditors under Canada's Companies' Creditors Arrangement Act, the equivalent of Chapter 11 bankruptcy. At the same time, it also announced a plan to restructure — a process that included closing 59 of its 225 stores and cutting 2,900 of its approximately 17,000 workers.



According to Bloomberg, both parties are keeping an eye on Sears Canada’s restructuring efforts to ensure that the company is moving forward.



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