Ecommerce retailer Amazon is reportedly in talks with mall owner Simon Property Group over plans to use certain closed JC Penney and Sears locations as fulfilment centres.

Simon is a real estate investment trust engaged in the ownership of premier shopping, dining, entertainment and mixed-use destinations.

The negotiations were first reported by the Wall Street Journal (WSJ), which did not provide details on the number of stores being considered by Amazon.

According to Simon’s recent filing cited by WSJ, its malls have 63 Penney and 11 Sears stores.

Late last month, the attorney of JCPenney told a bankruptcy judge that the company is planning to go ahead with the divesture of its business by this fall.

Meanwhile, Transformco temporarily closed all Sears stores in April due to coronavirus (Covid-19).

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By GlobalData

On 16 July, the company said that all Sears Stores that were closed due to Covid-19 have re-opened.

Speaking to USA Today, GlobalData Retail consultancy managing director Neil Saunders said: “Some of the alternative uses that were once floated, like gyms, are no longer feasible in the short term. This means that warehouse and fulfilment centres are an increasingly appealing option.

“However, inviting Amazon in is, in some ways, giving more power to a rival, so there will be debate about whether this is the right thing to do. The fact Simon is considering it underlines the fact that they are in a difficult position.”

Last week, Amazon secured UK Competition and Markets Authority’s (CMA) clearance for its 16% investment in food delivery start-up Deliveroo.