In a news release, JCPenney confirmed that its home office campus, which includes the Home Office building surrounded by 45 acres of land, will be sold for $353 million to Dreien Opportunity Partners, LLC, general partner of Silos Opportunity Partners, LP.
Upon the transfer of ownership, JCPenney plans to lease back nearly 65 percent of the building and leave the rest available for new tenants. According to the company, the lease expenses will be offset by lower maintenance costs, property taxes and interest expenses from paying down its debt with money earned from the transaction.
The retailer is putting its headquarters, located in Plano, Texas, up for sale as part of its ongoing effort to offload its enormous amount of debt, Fortune reported.
“Since we began exploring the sale of our Home Office, we have been quite pleased by the level of interest in the building. Our team reviewed numerous offers and decided that it was most advantageous to select Dreien Opportunity Partners, whose leadership recognizes the building’s long-term potential and has demonstrated tremendous support of the company as we maintain our Home Office operations within the booming Legacy corridor,” Marvin R. Ellison, chairman and CEO for JCPenney, said in the statement.
“This transaction also represents a significant financial milestone for the company, as proceeds from the sale give us the opportunity to reduce outstanding debt and make improvements to our workspace, creating a modern and efficient environment that fosters productivity and seamless collaboration,” Ellison continued.
In August, the retailer said it is back on the path to profitability.
The department store’s quarterly losses were more than halved as JCPenney cut costs and saw higher sales of footwear and home goods in its stores (plus beauty products, thanks to sales at Sephora outlets in its stores).
JCPenney also reaffirmed that it expects to grow by 3, or as much as 4, percent this year, which would be the first time the company has posted a profit in five years, according to Reuters.