Nearly a dozen retailers — including department store chains and shoe brands — have filed for bankruptcy protection so far this year, shuttering many of their stores — if not all of them.
The pace is slower than last year, when more than 20 retailers including Toys R Us, Hhgregg, and Gymboree filed for bankruptcy protection. But it’s no less painful for the employees and landlords who find themselves stuck in the middle as the retail landscape continues to evolve.
On Friday, Mattress Firm became the latest company to head down this path, as the largest mattress retailer in the U.S. grapples with how to trim its footprint of more than 3,000 stores. It’s initially planning to close as many as 700 locations, with roughly 200 stores expected to go dark as soon as “the next few days.” The company, owned by Steinhoff International Holdings, said it expects to complete a prepackaged restructuring within 45 to 60 days.
The closures by Mattress Firm, Toys R Us and other bankrupt brands are only adding to the glut of retail real estate that sits vacant across the U.S.
A new report from real-estate research firm Reis, released earlier this week, said U.S. mall vacancy rates climbed to 9.1 percent during the third quarter, their highest level in seven years. The group said closures from Bon-Ton and Sears Holdings accounted for much of the jump in empty storefronts. Sears, having already shuttered hundreds of locations, has a large debt payment hanging over its head due Oct. 15, which could push the company into bankruptcy if it doesn’t find a solution to restructure the business.
Toys R Us, meanwhile, could see another day. Its bankruptcy auction was recently put off as a group of hedge funds is considering reviving the business, bidding for the Toys R Us and Babies R Us brand names.
According to a list compiled by Moody’s, retailers at risk of defaulting on loan payments — and therefore could be forced to file for bankruptcy — include 99 Cent Only Stores, Charlotte Russe, Guitar Center and Payless ShoeSource, which once filed for bankruptcy protection but later emerged after closing more than 600 stores. Below is the list of retailers that have filed for bankruptcy protection so far this year, some of which have already managed to emerge.