Empty Charles City Kmart store apparently sold in auction, to $1 million bidder

By Bob Steenson, bsteenson@charlescitypress.com

The former Kmart building in Charles City has apparently been sold, although little information is available about the purchaser or plans for the building.

The building, at 1405 S. Grand Ave., is currently owned by Seritage KMT Finance LLC, of New York City. According to the company’s website, “Seritage is principally engaged in the ownership, development, redevelopment, management and leasing of diversified and mixed-use properties throughout the United States.”

The company put the former Kmart property up for sale on May 6 by Buyers Realty of Des Moines, The Shopping Center Group (TSCG) of New York and through Crexi, a commercial real estate marketplace based in Los Angeles.

The Charles City property went up for auction beginning Monday through Crexi’s website, with a required opening bid of $400,000.

There was little action on the auction until Wednesday afternoon, when about an hour before the auction ended a short bidding war began, going from $400,000 to $650,000, to $750,000, to $850,000, to $900,000, to $950,000 and finally to $1 million about a half an hour before the bidding ended at 2 p.m. CDT Wednesday.

There was no information on the website regarding the identities or the number of bidders taking part in the auction.

The Crexi auction page for the Kmart property now says, “Property is under contract sold subject to seller approval.”

A representative for the brokers, Lynn DeMarco with TSCG, told the Press the group would have no comments at this time regarding the sale or a buyer.

Tim Fox, the executive director of the Charles City Area Development Corp., said he had fielded four or five calls from parties that had shown interest in the building, but he wasn’t at liberty to discuss who they were.

He did say, “Ideally adaptive reuse of the idled Kmart facility shall possess tangible benefit for the community.”

Fox also said he was surprised that it had reached the $1 million sale price.

The building was built in 1995 and Kmart has been the only occupant. It has almost 110,000 square feet under roof and sits on a little more than 10½ acres of property with 470 parking spaces. It is zoned B-4 Highway Service Business.

The Charles City Kmart closed Feb. 16, 2020, along with the Algona Kmart, the last two Kmarts left in Iowa. At that time the stores were owned by Transformco, which had purchased the assets from Sears Holding and which closed 45 Kmarts and 51 Sears stores at the same time as the Charles City and Algona stores.