Department store chain Century 21 files for bankruptcy and will close all its stores after nearly 60 years as a destination for bargain hunters
- Century 21 Stores has filed for Chapter 11 bankruptcy, it announced Thursday
- The company is shutting all 13 stores across New York, New Jersey, Pennsylvania and Florida
- The department store chain had been a destination for bargain hunters for nearly 60 years
- The decision followed nonpayment by the company’s insurance providers of approximately $175million
- Century 21 co-CEO Raymond Gindi said ‘any meaningful portion’ of the insurance proceeds would have been able ‘to save thousands of jobs’
Century 21 Stores has filed for Chapter 11 bankruptcy and is winding down its business, shutting all 13 stores across New York, New Jersey, Pennsylvania and Florida.
The department store chain had been a destination for bargain hunters looking for fat deals on designer dresses and shoes, cosmetics and housewares for nearly 60 years.
Century 21 joins more than two dozen retailers who have filed for bankruptcy since the pandemic which forced non-essential stores to temporarily close.
In a statement, the New York-based company said that the decision followed nonpayment by the company’s insurance providers of approximately $175million due under policies put in place to protect against losses stemming from business interruption.
Century 21 Stores has filed for Chapter 11 bankruptcy and is winding down its business, including all 13 stores across New York, New Jersey, Pennsylvania and Florida
That insurance money helped it rebuild its flagship store, a magnet for locals and tourists in downtown Manhattan after it was damaged by the 9/11 attacks, the company said.
‘While insurance money helped us to rebuild after suffering the devastating impact of 9/11, we now have no viable alternative but to begin the closure of our beloved family business because our insurers, to whom we have paid significant premiums every year for protection against unforeseen circumstances like we are experiencing today, have turned their backs on us at this most critical time,’ said Century 21 co-CEO Raymond Gindi in a statement.
Gindi said that if Century 21 had received ‘any meaningful portion’ of the insurance proceeds, it would have been able ‘to save thousands of jobs and weather the storm in hopes of another incredible recovery’.
The company said that it’s removing from the bankruptcy court a lawsuit pending in the Supreme Court of the State of New York against several of its insurance providers based on their failure to compensate the company for its losses under the policies.
Centurty 21 co-CEO Raymond Gindi pictured left with founder of the company Al Gindi
The company is requesting that the bankruptcy court expedite the adjudication of the suit for the benefit of its stakeholders.
According to CNBC, the American Property Casuality Insurance Association has said that pandemic outbreaks are ‘uninsurable’.
Century 21, founded in 1961 in downtown Manhattan, added that it is starting going-out-of business sales at all of its stores and online.
It is the latest in a string of retail companies forced to file for bankruptcy due to the devastating economic effects of the coronavirus pandemic, including department chain store J.C. Penney, luxury retailer Neiman Marcus Group Ltd., and apparel seller J. Crew Group Inc.
The brands suffered immensely as stores were forced to shutter up in March in the lockdowns and shoppers made the move online.
Even after reopenings, the lower number of shoppers amid hesitance to return to stores continued the turbulent period for retailers.
J.C. Penney Co Inc’s landlords are said to be nearing a deal to rescue the beleaguered department store chain from bankruptcy proceedings, averting a liquidation that would have threatened roughly 70,000 jobs, it was announced Wednesday
Two shoppers are reflected in the window of the J.Crew store at the International Mall Wednesday, May 6, 2020, in Tampa, Florida. The company filed for bankruptcy this year
On Wednesday, J.C. Penney Co Inc reached a tentative deal with landlords and lenders valued at $1.75 billion to rescue the beleaguered department store chain from bankruptcy proceedings.
It is hoped the deal will avert a liquidation that would have threatened roughly 70,000 jobs and represented one of the most significant business collapses following the coronavirus pandemic, a company lawyer said.
Mall owners Simon Property Group Inc and Brookfield Property Partners LP have teamed up to acquire J.C. Penney´s retail operations and are putting the finishing touches on an agreement.
The deal would carve J.C. Penney into three pieces. In addition to the retail operations the landlords are purchasing, lenders would take control of two other entities housing some J.C. Penney stores and the retailer’s distribution centers.