OAKLAND -- A local developer is closing in on a deal to buy the Sears department store downtown and reconfigure the massive structure into a retail hub for the rebounding area.
Alan Dones, who heads the Oakland-based Strategic Urban Development Alliance, said he has assembled an investment team that is negotiating to purchase both the Sears building at 1955 Broadway and an adjacent city-owned parking lot at the corner of Telegraph Avenue and Thomas L. Berkley Way.
"I feel we're very close to a deal, but by the same token this is still very fragile," Dones said Friday. He would not disclose the purchase price or his investors. City sources confirmed that negotiations were advancing and that a deal could be in place shortly.
Sears, which last year began selling off several stores, declined to discuss any real estate moves in Oakland. "Sears values its presence in Oakland. We remain committed to serving our members and customers in the Oakland community," company spokesman Howard Riefs wrote in a prepared statement.
Sears is the last of the large department stores that once lined Broadway, but the struggling retailer barely occupies 20 percent of a four-story building that commands more than half a square block.
While the store remains downtown Oakland's biggest retail outlet, the building's huge swath of unused space is seen as a drag on the surrounding neighborhood, which has become the epicenter of Oakland's thriving night life scene. The building's basement, which opens directly to the 19th Street BART station, has long been closed to the public. The top floors, which Dones envisions as office space, also have been empty for years.
"Our objective is to get the building back to the point where it is open and visible and a cornerstone to downtown Oakland," Dones said.
If the sale goes through, Sears would be welcome to remain as an anchor tenant, he added.
Dones has commissioned several renderings of a remodeled Sears building that show several retailers with shops fronting both sides of the structure, on Broadway and Telegraph Avenue. The adjacent parking lot at Telegraph and Thomas L. Berkeley Way, he said, could include a mix of shops, homes and parking spaces.
"We at the city are very much behind Alan and his effort and think what he's doing is right for the corridor, and we're anxious to work with him," Assistant City Manager Fred Blackwell said.
Over the past decade, Dones has developed two condominium projects and an Alameda County Social Services building in Oakland. He said he is partnering with retail and office experts in putting together his bid for the Sears building.
The Broadway store would be the latest casualty of a companywide gutting by Sears CEO Edward Lampert, experts say. He began selling off Sears' most valuable assets about 18 months ago, and the Oakland location is among the company's prime properties. Lampert is asking top dollar for these stores, said Mark Cohen, a retail expert at the Columbia University Business School and the former chairman and CEO of Sears Canada.
"This is the way the businesses get liquidated," he said. "The cream of the crop goes first."
Contact Matthew Artz at 510-208-6435.