How Dead Department Stores Like Sears Are Giving Life to Innovation

In October, the same month that Sears filed for bankruptcy, the University of Cincinnati hosted a grand opening for its 1819 Innovation Hub. The 133,000-square-foot research and technology center is housed in a building that was once the city’s first Sears, Roebuck & Co. department store, and the art deco façade still looks much the same as it did when the store opened its doors in 1929.

Inside, though, where there were once shoes and appliances there are now drones and 3D printers. The space is designed to bring together students and faculty with corporations like Procter & Gamble and Kroger, and if all goes according to the university’s plan, it will be just the beginning for a burgeoning community of entrepreneurs and business leaders.

It’s a far cry from the current state of Sears, which has struggled to remain relevant amid increased competition from online retailers and forward-thinking rivals like Target and Kohl’s, both of which have invested far more heavily in modernizing their stores and adding omnichannel capabilities.
It also speaks to a trend of vacant department stores becoming incubators and startup hubs, utilizing space that’s increasingly hard to lease out to retail tenants, many of whom are looking for smaller, more localized spaces.

Another former Sears, a 270,000-square-foot building on Main Street in Houston, is being transformed into the Ion, a mixed-use space that will provide programming and resources for startups, universities and corporations to collaborate.

“The Ion will become Houston’s nucleus for innovation, fostering a community and culture where entrepreneurs and corporations come together to solve some of the world’s greatest problems,” said Rice University president David Leebron in a statement announcing the building’s renovations, which began in May. (The Rice Management Company is leading the project.)

In Fayetteville, Ark., the Northwest Arkansas Mall will soon be home to an early-stage startup incubator called Anchor. Its founder, Becca Shaddox, a veteran Walmart STEM executive, is taking over part of the Sears location that closed in Jan. 2018.

In Port Huron, Michigan, the basement of the former Sperry’s department store (a local institution that closed in 2000 after more than a century in business) has for two years housed The Underground, a co-working space and entrepreneurial hub that offers funding, incubation and office space to small businesses in the region.

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