DOWN TO BUSINESS – Site work continued this week in preparation for two businesses slated to take space at the old Sears store at Colonie Center: Floor & Decor and Sierra Trading Post.
Meantime, both told their new landlord they want a say in who else can locate there — in the 94,000 square feet remaining on the second floor of the former department store, which has no signed tenants yet, or in the vast sea of surface parking outside that is part of the 21-acre Sears parcel.
Their requests came in the form of a “memorandum of leasing,” or MoL, filed in Albany County last week.
MoLs are similar to deeds in format, but are between landlord and tenant. They outline space and deal terms, but offer no financial information, such as the rent to be paid.
Ann MacAffer, a broker with the Albany office of global commercial real estate firm CBRE, says MoLs are not unusual. Nor is the list of “prohibited” or “noxious” uses they sometimes contain.
For Floor & Decor and Sierra, the lists are long and seek to bar such tenants as a funeral home, a day care center, a banquet hall, a church or chapel, a manufacturer, a flea market, a hotel, a nursing home, a pawn shop, a gambling facility, or a business selling pornographic materials.
Some also have caveats, such as not wanting a second-hand store, but excluding “any first-class second-hand stores, such as Game Stop and Play It Again Sports.”
The MoLs also map out “restricted” areas – sections of the parking lot fronting each store — where no building can occur that would interfere with access or visibility.
Floor & Decor, which carries hard-surface flooring, and Sierra, an outdoors apparel and gear store owned by the parent of the T.J. Maxx and Marshall’s chains also don’t want to see other retailers selling merchandise similar to their own. That’s not an atypical retail tactic; it would apply to future tenants, not existing ones.
According to the MoLs, which were negotiated earlier this year, Floor & Decor’s lease is for 15 years, with four five-year options to renew. A representative said an October opening is targeted. Sierra’s lease is for 10 years, with three five-year options; the company reiterated this week it has made no announcement about a store here.
Neither new store would be accessible from the enclosed mall, which is separately owned, even though Sears was a longtime anchor. The space was among Sears and Kmart real estate sold in 2015 to Seritage Growth Properties of Manhattan to help prop up the companies. Seritage now is actively shopping the properties.
The MoLs would protect Floor & Decor and Sierra should the former Sears space change hands.
Seritage reported in April that it sold $290 million in holdings in the first quarter, had another $456 million in assets under contract, and was negotiating deals on $65 million more. From 161 properties in 2022’s first quarter, it’s now down to 72 properties.
Marlene Kennedy is a freelance columnist. Opinions expressed in her column are her own and not necessarily the newspaper’s. Reach her at [email protected].