Hipp: 'They never came to me at all'
Feb 1, 2014 at 11:44 PM
When Kmart announced it was closing its Norwalk store Friday, John Hipp was as surprised as anybody.
Hipp and his Maple City Builders group own the building that houses Kmart on Milan Avenue.
Maple City Builders bought the building “two, maybe three years ago,” Hipp said Saturday. “I was as upset as anybody else. I do not have a tenant right now.”
Hipp said Kmart had all of the control with the lease.
“They never came to me at all,” he said. “They called me last year and wanted to buy out the lease. Everything was in their court. They have all the options. They asked me If they could buy out the lease. I said no and I never heard from them again.
“The lease wasn’t up. They had option upon option to renew the lease. They could have renewed that lease as much as they wanted to.”
The store will close for good in mid-May, a local store official and company spokesman confirmed Friday.
The local store official referred comments to corporate officials.
“Until then, the store will remain open for customers,” Sears Holdings spokesman Howard Riefs confirmed in an e-mail Friday.
Riefs said the store will begin liquidation sales on Feb. 23.
Riefs said the Norwalk store’s 52 employees who are eligible will receive severance and have the chance to apply for open positions at area Sears or Kmart stores. Most of the associates are part time/hourly, Riefs said.
In 2004, Sears Holdings Corporation became the parent company of Kmart.
Kmart and Sears Holdings have been struggling, as year-to-year comparisons of sales in both Sears and Kmart stores have declined, according to company financial reports. Holiday sales were underwhelming.
The companies have been announcing store closings around the nation and last week made headlines by saying that Sears’ flagship store in Chicago would close. The company is headquartered outside Chicago.
“Store closures are part of a series of actions we’re taking to reduce ongoing expenses, adjust our asset base, and accelerate the transformation of our business model,” Riefs said in an e-mail last week. “These actions will better enable us to focus our investments on serving our customers and members through integrated retail — at the store, online, and in the home.”
Most workers at both stores are part-time and hourly, Riefs wrote.
Sears, which began as a catalog company, has told analysts that it is moving toward online sales and away from brick-and-mortar retail.
Discount store Kmart operates more than 1,300 locations across the United States. Customers may find a wide range of products from shopping at Kmart, such as clothing, jewelry, housewares, tools, electronics, and toys. Annually, Kmart creates close to $15 billion in revenue.
For Hipp, he will start looking for another tenant. This is the second major tenant the company has lost in recent months.
“Obviously I am disappointed with the news,” Hipp said. I lost my tenants with the bank (PNC, last year). We try to invest in the community.”