Three empty department stores in the Chicago suburbs are ready for reincarnation after recently changing hands, including one store that’s being converted into flexible warehouse space.
The three sales—of a Carson’s in North Riverside and Sears stores in Joliet and Orland Park—are good signs for the shopping malls connected to the big stores, properties that need to transform themselves with new ideas and money. The department store has become the ultimate white elephant of suburban real estate, and so many have closed at shopping malls over the past several years that it’s hard to find a local suburban mall without one that’s vacant.
Apartments have emerged as the most popular replacement for department stores, with projects underway at the Hawthorne Mall in Vernon Hills and Fox Valley Mall in Aurora and more planned at Westfield Old Orchard in Skokie and Northbrook Court in Northbrook.
But apartments won’t be coming to the former Sears in Orland Park. Cubework, a California company that specializes in “co-warehousing” bought the 203,000-square-foot store at the mall, according to CoStar Group, a real estate data provider. Borrowing from the co-working model, firms like Cubework lease small warehouse spaces to startups and entrepreneurs on flexible terms.
Cubework, which has four locations in the Chicago area, paid $4.3 million for the Sears store, about half the property’s $8.8 million asking price when CBRE was courting investors for it last year. Cubework and CBRE representatives did not respond to requests for comment.
In Joliet, ventures led by local car dealer Joseph Ghaben paid $4.3 million for the empty Sears at the struggling Louis Joliet Mall, according to CoStar. It’s unclear if Ghaben, leader of the Ghaben Auto Group, plans to open a dealership at the property, which encompasses 16.7 acres, including the surrounding parking lot. Ghaben did not return a phone call.
Cubework and Ghaben’s group bought the Sears stores from Seritage Growth Properties, a New York-based real estate investment trust created in 2015 by Hoffman Estates-based Sears Holdings, now known as Transformco. Seritage has been selling off and redeveloping former Sears stores ever since.
In North Riverside, the owner of the North Riverside Park Mall, the New York-based Feil Organization, confirmed that it has acquired the vacant 181,000-square-foot Carson’s store at the mall. In a statement, Feil CEO Jeffrey Feil offered no specifics about the company’s plans for the store.
“Owning this site supports our ongoing focus to enhance the value of North Riverside Park Mall for the community, strengthens our engagement with the Village of North Riverside and reaffirms the Feil Organization’s commitment to elevate the shopping center,” he said. “We are in the process of finalizing redevelopment plans, and acquiring this site is an important step toward fulfilling our long-term vision.”
