According to The Star:

Sears Canada is cashing out and closing two of its department stores in the Toronto area and may close a third, the retailer said Friday.

In a $191 million deal, Sears Canada is selling the leases on its stores at the Yorkdale Shopping Centre in Toronto and Square One in Mississauga back to the mall owners.

The mall owners have an option to close the big department stores and use that space to bring in new large-scale retailers. Friday was the closing date on the deal.

Sears Canada has also agreed to sell an option on its store to the owners of Scarborough Town Centre for $1 million, which could lead to its shutdown. The mall owners have five years to act on that option with a final price of $53 million.

Sears Canada said employees at the stores that are closing will be offered jobs at other Sears stores.

Sears Canada posted a $31.2 million loss as well as lower revenue in its latest quarter announced last month. In January, the retailer cut 700 jobs primarily at its distribution centres.

Sears Canada has had declining revenue for the last seven years.

The retailer also announced at its annual general meeting in April that it would drop its consumer electronics and window-coverings lines.

“We were presented with an opportunity that gives us significant financial benefit without changing our plans to improve the business and make Sears more relevant to Canadians,” Calvin McDonald, president and chief executive officer of Sears Canada Inc., said in a release.

The Yorkdale Sears opened in 1991 and the Square One store in 1973.

Retail consultant Ed Strapagiel told the Star in January that Sears is out of time, with discount retailer Target set to open 125 stores in Canada beginning in March.

“Sears’ latest financials show continuing sales declines. In previous work that I’ve done, Canadian consumers picked Sears as the most vulnerable to competition from Target. All Sears can do now is pare costs to the bone and try to hold on,” he said.

Sears operates 118 full-line department stores across Canada and six distribution centres.

The company sold the leases and shut down stores in Vancouver, Calgary and Ottawa last year. Cadillac Fairview, the mall owners, were bringing in the U.S. department store Nordstrom to fill those spaces.

McDonald, 41, was brought in by Sears Canada in 2011 to manage a three-year transformation of Sears Canada.

“Over the past year we have undertaken numerous actions to get the basics right, and have worked to transform Sears Canada into a retailer that can run effectively, efficiently and sustainably,” he said.

“Our efforts are beginning to show financial and operational results.”

Clothing and accessories sales grew for two quarters in a row compared with the previous year, the company said last month.