The owners of Fayette Mall plan to remodel the space now occupied by Sears for new retailers and add two or three restaurants to the front of the building.
Sears will close by the end of the year, but a date has not been confirmed, Howard Riefs, director of corporate communications for Sears Holdings, said Monday. He also said Sears did not plan to open a new store elsewhere in Lexington.
Sears owned its property at Fayette Mall, and CBL & Associates Properties, which owns and operates the mall, has bought the land, said Michael Lebovitz, CBL's executive vice president of development.
Lebovitz said the mall planned to focus on bringing in stores that are not already in Lexington, but he declined to name specific retailers or restaurants.
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"We're very excited about purchasing the Sears store," he said. "It demonstrates CBL's commitment to making Fayette Mall better."
Lebovitz said there was "a lot of demand for new retailers to come into Lexington," and the Sears space was a prime location for them.
The property serves as a connector from the end of the mall anchored by Dillard's to the end anchored by Macy's.
"It's really the middle of the mall," Lebovitz said. "This has always been something that we've wanted to do."
He did not disclose a target date for when the renovations might be completed.
The Sears store has 144 employees, and the Sears Auto Center, which also will close, has 17.
Riefs said those employees would be able to apply for positions at other Sears and Kmart stores, which also are operated by Sears Holdings.
Lexington has one Kmart store, at 2520 Nicholasville Road, which will remain open, he said.
"As a part of the ordinary course of business we close stores for a variety of reasons," Riefs said in an email. "The 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."
Terms of the sale were not disclosed.
It is not uncommon for anchor stores to own their property at the mall. Macy's and Dillard's also own theirs, Lebovitz said.
The two-story Sears store has about 150,000 square feet.
Lebovitz said some of the second floor probably would remain unused in the redevelopment, but part of it might be used by some larger retailers that would like a two-story layout.
The auto center, a detached building in front of the Sears store, will be torn down and converted to parking, he said.
He said no new square footage would be added to the mall through the redevelopment. CBL will file plans for the project with the city but has not yet done so.
The mall's announcement comes on the heels of the Urban County Planning Commission's unanimous decision last week to approve zoning changes for The Summit, a 50-acre commercial-residential development at Nicholasville Road and Man o' War Boulevard, just down the road from Fayette Mall.
The Summit's developers, Bayer Properties, have indicated they want to attract some upscale retailers that do not have a Lexington presence to the development.
Fayette Mall representatives have said they are concerned about increased traffic on Nicholasville Road as a result of the project.