The struggling retailer has struck a deal with the No. 2 U.S. mall owner General Growth Property (GGP) as part of a series of moves aimed at generating hundreds of millions of much-needed dollars.

Under terms of an agreement, announced on Wednesday, Sears (SHLD) and GGP will form a 50-50 joint venture to which Sears will contribute 12 of its properties at GGP-owned malls, which it will continue to operate though it is likely to end up using less space in them. GGP, in turn, will put cash into the venture, which will lease back the existing Sears Holdings stores to that retailer.

The deal will allow Sears to get $165 million in cash while giving GGP a chance to redevelop and release up to half the retail space at those 12 stores more productively. (In recent years, saying it needs less room as it becomes more digitally oriented, Sears has leased space at some of the stores it owns to other retailers, ranging from British fast-fashion retailer Primark to Whole Foods Market (WFM), Dicks Sporting Goods (DKS) and Nordstrom Rack (JWN), among others.)

Separately, Sears, which operates namesake stores as well as the discount Kmart chain, also confirmed on Wednesday it is moving ahead with a previously announced plan to sell some 250 other Sears Holdings to a newly created real estate investment trust, Seritage Growth Properties. It expects to raise some $2.5 billion from the REIT and plans to eventually sell its stake in the GGP venture to Seritage.

These efforts are the latest by retailer to reinforce its cash reserves amid years of sales declines and big losses, and attempts to reinvent itself as a membership-based company less reliant on physical stores. Sears has been burning through cash, hurt by net losses of $7.1 billion in its last four full fiscal years. In its recent holiday quarter, the company lost $159 million, its 11th straight quarterly loss and comparable sales (which strip out the effect of discontinued or sold off businesses and closed stores) fell 7% at Sears, and 2% at Kmart.

Last year, Sears sold off big assets such as the Lands’ End clothing brand and shares held by Sears in SearsCanada, transactions that followed earlier sales of its Sears Hometown & Outlet stores, all to raise $2.3 billion. Despite that, Sears had $250 million in cash at the start of the new fiscal year. After the Wall Street Journal reported last month that Sears was taking steps to reassure jittery suppliers by paying some of them faster, the company’s CFO Rob Schriesheim responded in a blog post that there was nothing wrong with that and that Sears was “meeting our obligations as we always have.”
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The REIT and the joint venture reflect how much less physical space Sears expects to need during its so-called transformation.

“As Sears Holdings continues its transformation into an integrated retailer that is focused on serving members across every retail channel, it is unlikely to require the same amount of square footage in each of its physical stores,” the company said in a statement. (Many mall owners have been more than happy to replace Sears stores with more popular, lucrative destinations better able to generate mall traffic: for example, GGP’s Woodlands mall near Houston replaced a Sears with a Nordstrom a few years ago.)

It’s true that more of its business now comes from members of its “Shop Your Way” loyalty program. In 2014, some 74% of its revenue came via sales to the program, up from 69% a year earlier. But because Sears doesn’t disclose the size of the membership or whether it is growing in absolute numbers, that increase could also just mean that sales to non-members are falling.
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