11.9 C
Munich

Brooks Brothers Bankruptcy Shows How Small Sellers Hold Home Bags

Anfield, contact. – The bones of Brooks Brothers stores are scattered 100,000 square feet here in a warehouse near the Massachusetts border, mixed with cardboard boxes and a sea of ​​rubbish.

There are legions of mannequins, empty circular tables that once showed necklaces, posters of riding gentlemen from the past. There is a whole section of Christmas trees ան countless golden ornaments of sheep, which are suspended with a ribbon. The symbol of the Brooks Brothers has been known as the Golden Wool since 1850. Empty order items for tailors are scattered. A neon sign that probably still works. There are no clothes, but there are a number of heavy sewing machines, which most likely came from one of the brand’s recently closed factories. And in the bathroom, next to the toilet, sits the carpet of greetings of the Brooks brothers with the embossed writing.

Last year, after the Brooks Brothers filed for bankruptcy, the whole mass was left here, the retail balances that sold almost $ 1 billion in 2019.

From then on, the couple who owned the warehouse, Chip և Rosanna LaBonte, struggled to figure out how to get rid of it all. The junk companies told them it would cost at least $ 240,000 to clean up the area, which Brooks Brothers had leased until November. LaBontes will have to sell their home to pay the bill.

The plight of the couple shows the far-reaching consequences of retail bankruptcy, which were cascaded during the epidemic and affected everyone from factory workers to managers. Smaller sellers, “landlords in the long-running Byzantine bankruptcy,” have often been left with a short edge, particularly restrictions on larger corporations on what they can spend on legal bills. And after selling bankrupt brands, people like LaBontes usually stay in the dust.

“It’s a very sad situation, which unfortunately happens quite a bit, because it’s part of the bankruptcy situation when the law is made,” said Arn Ames Van Horn, a Barnes-Thornburg bankruptcy retailer. “Unfortunately, creditors can fall victim. Sometimes they have little or no opportunity to repay their debt.”

Retail companies like the Brooks Brothers were among the more than 600 corporate bankruptcies in the United States last year, which had the highest number of applications in the last decade, according to S&P Global Market Intelligence.

LaBontes, which is in its 60s, is working with a liquidator to sell the Brooks Brothers’ harmful substances, and is preparing to list their home in Sherburn, Massachusetts. Although they have filed for bankruptcy, they expect to receive less than 5% of their debt, if so, and admit that the proceedings are hopelessly confusing. Most of all, they are angry and unbelievable about the situation, especially since Brooks Brothers continues to operate under rich new owners.

“We understand going out of business, bankruptcy, but throwing their problem on us, leaving it, forcing us to bear this cost of cleaning.” Chip LaBonte said at Anfield, Connecticut. “No one would expect such an expense. We don’t have the money for a rainy day to deal with it. “

The Uyghur warehouse was purchased in 2010. They have other tenants և self-sufficiency department but are frustrated with the mess: not being able to use the area for anything else until it is cleared.

Founded in 1818, the Brooks Brothers, the oldest continuum clothing brand in the United States, rented a warehouse in Anfield in 2011, most recently for about $ 20,000 a month. (Brooks Brothers also has a corporate office and distribution center in Anfield.) The building, which covers about 375,000 square feet, is owned by LaBontes through KBRC Realty. It is the sole property of the firm հիմնական the couple’s main source of income.

The retail office suite sank last year as many Americans worked part-time, digging through most of their closets. J. Crew և Owners of Ann Taylor and Men’s Wearhouse were also declared bankrupt while trading in chains like Banana Republic. The temporary closure of shops added to the catastrophic situation, as well as the cancellation of special occasions such as prostitutes, alumni, weddings and other events.

All of this led to the bankruptcy of Brooks Brothers in July, one of the collapse of retail sales in 2020. The company closed its Seattle store, and its website lists the point of sale in Tulalip as its only Washington site. The Brooks Brothers dressed all four US presidents at the time of the inauguration and were proud of their US factories, which also had to close.

But investors saw value in the brand, and the retailer was quickly bought for $ 325 million by Simon Property Group, the largest U.S. retailer, and the licensing company Authentic Brands Group.

The company, through a joint venture called SPARC Group, buys a number of bankrupt retailers, including Lucky Brand denim և Forever 21, using a combination of Authentic Brands experience with well-known brand names in a variety of lucrative creative licensing (և some, say, equity destructive) weather and Simon’s real estate portfolio.

At the time of its acquisition of Brooks Brothers, SPARC was committed to continuing to operate at least 125 Brooks Brothers retail outlets until the outbreak of 424 retail outlets worldwide.

Under the new owners, Brooks Brothers went through checks, but continued to pay rent in the warehouse until November, sending even more goods there as it closed dozens of stores and closed its three US plants, LaBontes said. But after Thanksgiving, it sent a letter to the couple rejecting the lease, as well as the contents of the warehouse. According to the person with information about the transaction, the warehouse և its contents were not part of the purchase of SPARC – Brooks Brothers. As a result, according to Van Horn, the new owner probably has no legal responsibility to LaBontes.

The SPARC representative stopped returning requests for comments.

“They used it for all the fixtures in their shops, so the tables, the poles, the fishing rods, the rules, everything you saw, they would go from store to store to decorate it,” said Chip Labonte. “Probably, there is a 20,000 square foot Christmas tree there. Everything except the product itself. ”

And for those who want it now, customers include local clothing manufacturers looking for mannequins ստ Key designer from the upcoming HBO “The Gilded Age” series. Last Monday, an elderly couple wandered through the space looking at Christmas decorations and empty gift boxes. Habitat for Humanity has been looking at freight for a few days now, picking up some goods. Still, Chip LaBonte estimates that 30% of the remnants have been sold somewhere.

The liquidator paid LaBontes about $ 20,000 to sell what he could until mid-April. The oyster will not get a haircut և will deal with the balance. When garbage disposal experts estimated the cost of cleaning up the area in December, one share was $ 243,000 and the other $ 290,000.

“We are just another victim of COVID for them. we get it, ”Rosanna Labonte told Brooks Brothers. “But I also do not think they realized how many things were there.”

Helpless garbage companies, which confirmed the prices in an interview with The New York Times, said that it is expensive to remove the volume of the product. The costs included labor. multiple destinations landfills և donation և recycling centers; օգտագործ Use of special equipment such as crane, large bins և 18-foot box truck.

“I’ve been doing this for seven years, I’ve never seen anything like it before,” said Rick MacDonald Jr., owner of EastSide Junk, which offered the couple a $ 243,000 price tag. “They left astronomical items.”

When the patent company Authentic Brands announced its acquisition due to the bankruptcy of Brooks Brothers last year, the company’s CEO Ter Amy Salter spoke of the retail legacy և “incredible story”.

LaBontes, facing a warehouse full of some of that story, was unhappy to see those comments.

They recently issued a statement asking: “What kind of legacy can they claim when they act on low wages, like day and night violence?”

LEAVE A REPLY

Please enter your comment!
Please enter your name here