Garden City Sears to close after company's Chapter 11 filing

A Sears in Garden City is among 77 Sears stores and 65 Kmarts that their parent company will close near the end of the year as part of its Chapter 11 bankruptcy filing.

Hoffman Estates, Illinois-based Sears Holdings Corp. filed for bankruptcy protection Monday, buckling under its massive debt load and staggering losses.

The question now is whether a smaller version of the company that once dominated the American retail landscape can remain viable or whether the iconic brand will be forced out of business.

Sears, which started as a mail order catalog in the 1880s, has been on a slow march toward extinction as it lagged far behind its peers and incurred massive losses over the years.

"This is a company that in the 1950s stood like a colossus over the American retail landscape," said Craig Johnson, president of Customer Growth Partners, a retail consultancy. "Hopefully, a smaller new Sears will be healthier."

Others don't share Johnson's optimism.

"In our view, too much rot has set in at Sears to make it a viable business," said Neil Saunders, managing director of GlobalData Retail, in a note published Monday.

Even President Donald Trump weighed in on Sears' collapse, calling it "a shame."

"Sears, Roebuck, when I was growing up, was the big deal. And it's very sad what happened, very, very sad," he said to reporters on Monday outside of the White House.

The Garden City store has operated at 1111 Franklin Ave. since 1996.

Sears Holdings closed a Sears at 195 N. Broadway in Hicksville in April, and a Kmart at 1000 Montauk Hwy. in West Babylon in September.

In August, the company said a Kmart in Riverhead and a Sears store in New Hyde Park would be among 46 unprofitable stores closing in November.

After all of the announced closings, there will be three Sears stores and four Kmarts on Long Island.

Sears joins a growing list of retailers that have filed for bankruptcy or liquidated in the last few years amid a fiercely competitive climate. 

Edward S. Lampert, the company's largest shareholder, has stepped down as CEO but will remain chairman of the board. He has been loaning out his own money for years and has put together deals to prop up the company, which in turn has benefited his own ESL hedge fund.

Lampert owns 31 percent of the company's shares, while his hedge fund has an 18.5 percent stake, according to FactSet.

Sears' stock has fallen from about $6 over the past year to below the minimum $1 level required to be listed on the Nasdaq stock index. In April 2007, shares were trading at around $141. 

It had 4,000 stores and 350,000 workers at its peak in 2012, but will now be left with a little more than 500 stores. The company had 68,000 workers as of Monday's court filing; it declined to say how many workers would be affected by the latest closings.

With AP

By Tory N. Parrish

tory.parrish@newsday.comToryParrish1

Tory N. Parrish covers retail and small business for Newsday. She has worked at the Pittsburgh Tribune-Review and Observer-Dispatch in Utica, N.Y.