The city’s 11 Kmarts are probably among the most profitable in the bankrupt chain – but the cash-starved company could close some of them because selling their leases could bring in big bucks, experts say.
That could be a good deal for consumers because the next store to move in could be more popular. Among retailers most likely to take over are Kohl’s, Target and Circuit City, brokers say.
Kmart has two stores each in Manhattan, The Bronx and Staten Island, four in Queens and one in Brooklyn.
The company is known for negotiating low-cost, long-term leases in high-powered locations – and that makes the stores a financial football that can be tossed around to pay creditors.
Their real-estate value could do more to help prop up the company than the ringing of cash registers.
Kmart’s stores in Manhattan, at One Penn Plaza at 34th Street, and 770 Broadway at Astor Place, could be worth millions. Both leases run to 2016.
Today’s market could mean the new tenants would pay much higher rental prices, so if Kmart sells its lease, it would keep the difference, said David Rosenberg, an executive vice president of Robert K. Futterman & Associates, a store brokerage firm.
Kmart will soon give out the list of the stores it will shut.
