Daily Archives: June 12, 2017

It's only Monday, and the retail sector has already seen a rough start to the week.

Gymboree's filing for Chapter 11 bankruptcy protection has many retail industry watchers wondering who's next. With the record pace of bankruptcies in the industry this year, bankruptcy, for some, is becoming an issue of when the company will file, not if they will.

So far this year, specialty retailers Rue21 and Payless Shoesource are among those contributing to the rising default rate in the sector, Fitch explained.

In a research note Monday, Fitch highlighted its so-called loans of concern list, which includes: Sears Holdings, Claire's Stores, Nine West Holdings, 99 Cent Stores, J. Crew, True Religion Apparel, Charlotte Russe, Charming Charlie, NYDJ Apparels and Vince.

Retailers on the list are considered to have a significant risk of default within the next 12 months.

Taking a look at Fitch's latest list, "a number of these names have been at the forefront of past restructurings," Joshua Friedman, a legal analyst for Debtwire, told CNBC in an interview.

"Struggling retailers need to look at near-term triggers, such as debt that's maturing, interest expense and interest payments coming due," he went on.

High debt leverage and weak operating trends are what drove Gymboree's filing specifically, Fitch said in a statement Monday.

In conjunction with its latest filing with the Securities and Exchange Commission, Gymboree said it has secured commitments for up to $308.5 million in additional financing. The Chapter 11 filing should reduce Gymboree's debts by more than $900 million, the company added.

Gymboree now has plans to shutter some 375 stores, according to court filings. The company currently operates 1,300 stores.

"Fitch's expectation of increasing retail defaults stems from increased discounter (including off-price and fast-fashion apparel) and online penetration, along with shifts in consumer spending toward services and experiences," the credit rating agency said. "These factors have created a highly competitive retail environment and accelerated adverse trends in mall-based shopping."

Just last week, Moody's also issued an updated report saying the ranks of distressed apparel and specialty retailers are growing.

In February, among Moody's rated retail and apparel issuers, 19 retailers had ratings of 'Caa' or lower. That number has now grown to 22 companies, or about 15 percent of the firm's retail and apparel category, Moody's reported.

Among those 22 distressed names are Gymboree which has now filed for Chapter 11 Sears, Nine West, Claire's Store, David's Bridal and Charming Charlie. In other words, many of the same retail players on Fitch's watch list.

Moody's lead retail analyst, Charlie O'Shea, has suggested keeping an eye on those 22 names to track which company might file for bankruptcy sooner rather than later. And there's a load of retail debt coming due in 2018, too, he added.

"Many retailers don't have the flexibility to do what they need to do," O'Shea told CNBC.

Watch: China's retail tailwind

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In the wake of Gymboree's bankruptcy filing, here are the retailers that could be next - CNBC

Cowboy-themed restaurant Square 1 Burgers and Bar filed for reorganization bankruptcy for all its locations, including the recently closed spot in Winter Park.

Tampa-based Square 1, known for its buffalo burgers and cow-print decor, filed 12 separate bankruptcy petitions in U.S. Bankruptcy Court for the Middle District of Florida Friday, including its parent company, a property company and two recently closed locations.

In its bankruptcy filing, Square 1 blamed the financial troubles on an over-saturated restaurant market.

Unfortunately, between 2014 and 2016, a number of restaurant franchises flooded the market saturating the areas around Square Ones restaurant with a litany of dining options, court documents said. When the competition settled in, Square One struggled to breakeven and quickly fell behind with its creditors.

Square 1 closed in Winter Park in May after being ordered to leave after allegedly owing about $21,000 in back rent, according to court documents.

Winter Park landlord Andre Raab said the burger restaurant left in the dark of night.

Square 1 also recently closed a location in Sarasota, according to the Sarasota Herald-Tribune.

Square 1 Burgers kicked out of Winter Park restaurant space

Square 1 has eight locations left and the company filed for bankruptcy on all eight individually.

For the Winter Park bankruptcy, Square 1 listed assets of $1 to $10 million and debts of $1 to $10 million. The itemized list of liabilities adds up to about $70,000, but most of the money is owed to the landlord, food provider Sysco and meat company Master Purveyors in Tampa.

A representative for Square 1 Burgers did not return a phone call or email Monday afternoon. The company s lawyer, Scott Shuker, said there are separate filings because each restaurant is an individual limited liability corporation.

Square 1 was founded by Tampa restaurateur Bill Shumate and partner Joanie Corneil, along with Ray Leich. Schumate and Corneil also own Bellas Italian Cafe in Tampas Hyde Park.

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Square 1 Burgers files bankruptcy, blames over-saturated restaurant market - Orlando Sentinel

Property Spotlight: SEALED BID OFFERING! Prime Development Land along the Salina, KS Retail Corridor

CST Industries hopes bankruptcy will help it clean up its balance sheet and perhaps find more

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Kansas City-based CST Industries Inc. filed a Chapter 11 bankruptcy petition to rightsize its balance sheet and potentially identify a new partner.

Founded in 1893, CST Industries (originally known as Columbian Steel Tank) is the largest manufacturer of steel tanks and covers in the world, with clients in agriculture, industrial liquids, oil and gas, water and wastewater, bioenergy and other markets. More than 350,000 of its tanks and 18,000 covers have been installed in 125 countries around the globe.

CST Industries hopes bankruptcy will help it clean up its balance sheet and perhaps find more

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Beset with overwhelming debt, the company decided to file for bankruptcy to give it an opportunity to once again thrive. The company listed between $100 million and $500 million in assets and liabilities.

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Big KC manufacturer files for bankruptcy - Kansas City Business Journal

Esperanza Unidas chapter 11 bankruptcy filing will delay the city of Milwaukees efforts to find a new use for the organizations building on National Avenue.

The bankruptcy proceeding puts a hurdle in front of us in our plans to acquire the site, said Jeff Fleming, Department of City Development spokesman. For the time being we will no longer be advertising the site for development and await the bankruptcy proceeding to conclude.

The city issued a request for proposals in March in anticipation of acquiring the properties at 1313 and 1329-1331 W. National Ave. through foreclosure. Fleming said the city did receive some interest in the property, but declined to say if any or how many proposals were submitted, adding the process is now on hold.

Esperanza Unida, an organization that focuses on workforce and economic development, filed for chapter 11 last week. The organization said it has $1 million to $10 million in liabilities. Those debts included more than $400,000 in unpaid taxes owed to the IRS, nearly $150,000 owed to the state workers compensation fund and nearly $150,000 owed to the city of Milwaukee, including $72,000 in unpaid property taxes.

Esperanza Undia executive director Manny Perez, a former Department of Workforce Development secretary, said he is hoping to have the building generate revenue again in the future to help the organization pay down its debts.

The idea is to re-position the building for its mission, which is to accelerate economic development and create jobs, pay creditors, at least in a standard manner and accelerate entrepreneurship on the Milwaukee south side which is the mission of that building, Perez said.

He said he previously had found a buyer for the properties, but that deal fell through at the end of 2016. Perez said he then approached city officials to ask if they would acquire the site through a foreclosure under state brownfield statutes. He said the city agreed, but required him to find a buyer and declined to cover any attorney or realtor fees.

Perez said he couldnt find a buyer again and opted to find potential occupants for the facility instead. He said hes been able to secure three rental contracts for various portions of the building and hopes to find one more.

But he added the presence of the citys foreclosure and RFP actions have made prospective tenants nervous about moving forward with building repairs and occupancy.

Perez said his goal for the building is to get it rehabilitated as soon as possible and get it producing revenue, but those efforts are also complicated by the $1.5 million to $2 million in liens still on the building, he said.

Those liens were transferred over from Esperanza Unidasformer building at 611 W. National Ave. The city seized that property in 2014, after the then non-profit failed to pay property taxes. Esperanza Unida, which is currently run from offices at 2825 N. Mayfair Road in Wauwatosa, converted to a for-profit entity two years ago, Perez said.

If somebody wants to buy (the building in the 1300 block of National Avenue) for $2 million, Ill sell it, he said. If nobody is there for $2 million, we have to create a system where we restructure the debt and we make partial payments and the first thing that must occur is increased revenue. Im only doing what any good business person would do in the absence of a buyer.

Fleming said there has already been a lot of public discussion about the building and the city has an interest in seeing it return to providing tax revenue but more importantly to become an asset neighborhood.

Perez also said he has a longer term strategic plan for the organization, but declined to provide specifics.

Id rather report on what has been accomplished, not what hopefully will be accomplished, he said.

Esperanza Unidas chapter 11 bankruptcy filing will delay the city of Milwaukees efforts to find a new use for the organizations building on National Avenue.

The bankruptcy proceeding puts a hurdle in front of us in our plans to acquire the site, said Jeff Fleming, Department of City Development spokesman. For the time being we will no longer be advertising the site for development and await the bankruptcy proceeding to conclude.

The city issued a request for proposals in March in anticipation of acquiring the properties at 1313 and 1329-1331 W. National Ave. through foreclosure. Fleming said the city did receive some interest in the property, but declined to say if any or how many proposals were submitted, adding the process is now on hold.

Esperanza Unida, an organization that focuses on workforce and economic development, filed for chapter 11 last week. The organization said it has $1 million to $10 million in liabilities. Those debts included more than $400,000 in unpaid taxes owed to the IRS, nearly $150,000 owed to the state workers compensation fund and nearly $150,000 owed to the city of Milwaukee, including $72,000 in unpaid property taxes.

Esperanza Undia executive director Manny Perez, a former Department of Workforce Development secretary, said he is hoping to have the building generate revenue again in the future to help the organization pay down its debts.

The idea is to re-position the building for its mission, which is to accelerate economic development and create jobs, pay creditors, at least in a standard manner and accelerate entrepreneurship on the Milwaukee south side which is the mission of that building, Perez said.

He said he previously had found a buyer for the properties, but that deal fell through at the end of 2016. Perez said he then approached city officials to ask if they would acquire the site through a foreclosure under state brownfield statutes. He said the city agreed, but required him to find a buyer and declined to cover any attorney or realtor fees.

Perez said he couldnt find a buyer again and opted to find potential occupants for the facility instead. He said hes been able to secure three rental contracts for various portions of the building and hopes to find one more.

But he added the presence of the citys foreclosure and RFP actions have made prospective tenants nervous about moving forward with building repairs and occupancy.

Perez said his goal for the building is to get it rehabilitated as soon as possible and get it producing revenue, but those efforts are also complicated by the $1.5 million to $2 million in liens still on the building, he said.

Those liens were transferred over from Esperanza Unidasformer building at 611 W. National Ave. The city seized that property in 2014, after the then non-profit failed to pay property taxes. Esperanza Unida, which is currently run from offices at 2825 N. Mayfair Road in Wauwatosa, converted to a for-profit entity two years ago, Perez said.

If somebody wants to buy (the building in the 1300 block of National Avenue) for $2 million, Ill sell it, he said. If nobody is there for $2 million, we have to create a system where we restructure the debt and we make partial payments and the first thing that must occur is increased revenue. Im only doing what any good business person would do in the absence of a buyer.

Fleming said there has already been a lot of public discussion about the building and the city has an interest in seeing it return to providing tax revenue but more importantly to become an asset neighborhood.

Perez also said he has a longer term strategic plan for the organization, but declined to provide specifics.

Id rather report on what has been accomplished, not what hopefully will be accomplished, he said.

Originally posted here:

Esperanza Unida bankruptcy delays city redevelopment efforts - BizTimes.com (Milwaukee)

Gymboree filed for bankruptcy protections, making it the latest casualty in a long line of troubled retailers. Gymboree filed for bankruptcy protections, making it the latest casualty in a long line of troubled retailers.

(CNN) - Gymboree filed for bankruptcy protections, making it the latest casualty in a long line of troubled retailers.

The children's clothing retailer said it has reached an agreement with its lenders that will allow it to stay in business as it attempts to restructure. It has arranged to borrow an additional $35 million to finance operations during the restructuring. The company's announcement did not include any plans for store closings.

The company has nearly 1,300 stores, including about 750 with the Gymboree brand as well as stores under the Crazy 8 and Janie and Jack brands. It had about 12,000 employees as of last summer, according to a company filing.

Gymboree filed for bankruptcy protections, making it the latest casualty in a long line of troubled retailers.

The children's clothing retailer said it has reached an agreement with its lenders that will allow it to stay in business as it attempts to restructure. It has arranged to borrow an additional $35 million to finance operations during the restructuring. The company's announcement did not include any plans for store closings.

The company has nearly 1,300 stores, including about 750 with the Gymboree brand as well as stores under the Crazy 8 and Janie and Jack brands. It had about 12,000 employees as of last summer, according to a company filing.

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Gymboree is filing for bankruptcy - Big Country Homepage

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Autographed jerseys of Cleveland Cavaliers superstar LeBron James and Boston Celtics legend Larry Bird were among the items auctioned off during bankruptcy proceedings involving former NBA small forward Darius Miles.

On Sunday, TMZ Sports reported Miles received $12,780 from the sale of basketball memorabilia and other personal items. Additional basketball-related pieces included signed shoes from the Dallas Mavericks' Dirk Nowitzki and two-time NBA champion Lamar Odom.

Last September,Beth Hundsdorfer and George Pawlaczykof theBelleville News-Democratreported the third overall pick in the 2000 NBA draft listed less than $500,000 in assets and $1.57 million in liabilities on his bankruptcy paperwork.

Among his debts included $282,041 owed to the Internal Revenue Service and $20,000 in unpaid child support, according to theBelleville News-Democrat.

Miles received $1,500 for the James jersey, $100 for the Bird jersey, $375 for the Nowitzki shoe and $225 for the Odom shoe during the sale, per TMZ Sports. He also earned $900 from the sale of two guns and two bucks for his toaster, among other items.

The 35-year-old Illinois native played seven seasons in the NBA with the Los Angeles Clippers, Cleveland Cavaliers, Portland Trail Blazers and Memphis Grizzlies. He averaged 10.1 points, 4.9 rebounds and 1.9 assists across 446 appearances.

He most recently played during the 2008-09 season, appearing in 34 games with the Grizzlies.

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Darius Miles' Bankruptcy Sale Includes Signed LeBron James, Larry ... - Bleacher Report