Department store chain J.C. Penney is planning to sell its Dallas headquarters in a bid to raise cash and lower its $5.2 billion debt load.
According to Fortune, J.C. Penney said that one of its consideration is the growing commercial real estate market in Plano, Texas where its home office is located. About 20 miles north of downtown Dallas, the company plans to also partially leaseback the headquarters. JCPenney's home office has 1.8 million square feet of space and currently has an extra space of 650,000 square feet that the new owner will be able to market.
"With the tremendous growth and development currently taking place within Plano and North Texas, there's no better time to take advantage of this lucrative market by pursuing a sale of our Home Office real estate," JCPenney Chief Executive Officer Marvin Ellison said.
"Even as we continue to deliver positive financial results across all aspects of our business, including delivering year over year gross margin increase in the fourth quarter, this presents an ideal opportunity to reduce outstanding debt and create long-term savings for the Company."
The marketing of the three-story building located in Legacy Business Park in Plano, Texas will be taken care of CBRE Capital Markets, a commercial real estate services firm. The property in a 64-acre site has served as the department store's global headquarters since it was completed in 1992.
In the past four years, Texas has seen a solid growth in its real estate market, particularly with the housing demand. According to Dallas Business Journal, 2016 may not be a record year but it is still expected to be a strong one for the sector. The effects of downturn in the energy sector, particularly in oil, is yet to be seen in the area.
