As Kmart fades, Lake Street store remains a beacon

Kmart stores across the nation are going dark, but the retailer's aisles are still humming with shoppers on Minneapolis' Lake Street — a store defying the odds of the modern retail upheaval.

"If they close this one down, we're stuck," said Lamarr Scott, walking out of the store last week into the vast parking lot. "The poor folks don't have any place to go but here."

The store in south Minneapolis was just hitting its afternoon stride Thursday when Sears Holdings Corp. announced another 63 Sears and Kmart store closures. That will leave just four Kmarts in Minnesota, down from 49 in the 1990s.

But the Lake Street outpost remains a hub for the diverse, working-class community around it, even after the city shelled out millions last year to buy the land underneath it in hopes of one day reopening Nicollet Avenue.

Amid the retail din of beeping product scanners, clanking coin sorters and familiar background music like "We Are Family," a steady stream of mostly Latino, African immigrant and African-American customers shopped for everything from bathing suits, sunglasses and storage bins to toilet paper, water and fruit. A group of East African women admired bath mats, a mother fitted a sandal onto her young son's foot, a child repeatedly honked a bike horn.

Others waited at the front desk to cash checks for a $1 fee, a bargain compared to some check cashing businesses. Beneath multicolored inflated balls at checkout, a woman paid with a cash card loaded with money from the nearby CSL Plasma donation center.

Garas Jama was there to buy shirts and trousers. A recent arrival from Kansas, Jama said his friends in the Somali community recommended Kmart. "They say that shop, that's a good shop. You get cheaper stuff," Jama said.

Kmart representatives have said the store, which opened in 1978, is one of the best performers in the chain. A Kmart spokesman said this week the store "remains very successful," a notably positive outlook on the same day Kmart's parent reported a 9.5 percent drop in comparable store sales for the first quarter of 2018. Later that day, Kmart shoppers in Duluth, Des Moines, Rockford, Ill., and 12 other cities learned the doors were closing for good.

Joyce Wisdom recalls conversations with the Lake Street store's management during her decade as head of the Lake Street Council, a business coalition. She left the job in 2014.

"Sears and Kmart [were] going down all over the country. And whenever I would talk to anybody down there, they'd say, 'But not this store,' " Wisdom said.

Keith Elliott was just browsing Thursday in advance of getting his Social Security check on Friday, the first of the month, when he planned to return with a group from the drug treatment center where he is living. The center only gives him a few hours a day to shop, he said, and he can walk to Kmart.

"I'm getting kind of like a heads up on what I can get because it's going to be packed," Elliott said. He planned to buy hair products, toothpaste, mouthwash, a watch and also had his eye on a bracelet chain that had been marked down by 75 percent.

Not everyone in the neighborhood is impressed with the store. In the parking lot, a group of day laborers waited for cars to roll up and hire them on the spot. One of the men, who declined to give his name, sniffed that Kmart is "expensive, low quality."

"I bought jeans," he said. "Three weeks later it got all ripped open. Ten dollars. I can buy $10 jeans from Walmart and wear it for a couple of years."

For many customers who live nearby, Kmart is the only option for a broad assortment of goods — from pillows to patio furniture to plantains. Its grocery section, though limited, carries specialty products like tamale masa, queso cotija and chamoy sauce.

One of the neighbors, Moe Yassin, picked up some snacks on Thursday afternoon.

"The only reason I come here is just due to proximity. I live around here. They have [a] variety of different stuff," Yassin said.

Anita Willie bought soda and chips.

"It's cheaper and it's in the neighborhood. It's not like Walmart and Target, which are all the way over there," Willie said. "We've got a place right here that people can easily come in, buy food, clothes, shoes."

Waiting for food at one of the two taco trucks that regularly set up in the parking lot, Kmart cashier Fred Jackson said he hadn't heard much about the news of another round of closings.

"I heard my guy over there at Register 4 say something about it. And then you. And that was it," Jackson said.

Jackson has worked in retail for 20 years, so he expects he could find another job nearby if the store shuts down. But he doesn't want to change where he shops.

"I just hope they stay in business because … I don't want to go over to Walmart," Jackson said.

The city has long aimed to reopen Nicollet Avenue at Lake Street, decades after allowing Kmart to block the corridor out of desperation following a redevelopment plan gone awry. It even became Kmart's landlord in 2017 after paying about $8 million for the land beneath the store. But the retailer has a lease that extends through 2053. Kmart representatives have said in the past that they would like a new Kmart store to be included in a redevelopment of the block.

David Frank, director of the city's community planning and economic development department, said city officials have explored different options with the retailer but haven't been able to reach a deal.

"They wanted a new store [in the redevelopment]. We showed where it would sit, up closer to Lake Street," Frank said. "Once they saw that and we were able to have a conversation about it, it still wasn't something that could work for them."

Frank said his friends forward him the latest business stories when new Kmart closures are announced, but he isn't holding his breath.

"I know that if something were going to happen, we would hear about it," Frank said.

In the recent round of closings, Sears Holdings announced that it would be closing both a Kmart and Sears in Duluth, as well as a Sears in Brooklyn Center.

David Marcotte, a senior vice president with Kantar Retail, said Sears Holdings is likely making closure decisions based on profitability and whether a store's sales are trending up or down. But the long-term outlook does not look good.

"I don't think anybody has come up with a clever way of explaining how they survive," Marcotte said.

Eric Roper • 612-673-1732 Twitter: @StribRoper