Lessons From Bon-Ton’s Plan To Avoid Liquidation

David Berliner

YORK, PA–Earlier this month Washington Prime Group, Namdar Realty Group and DW Partners had a plan to keep The Bon-Ton chain of department stores a going concern  by putting in their own bid to save the retailer from bankruptcy. Bon-ton got behind the plan as well and urged the bankruptcy judge  to allow it to pay $500,000 in due diligence costs to the partners so they could move their letter of intent to an actual bid. The judge ruled against this move and this week, the department store went to auction where it was promptly snapped up by bidders intent on liquidation.

So closes another chapter in the retail industry’s ongoing struggles. So far this year retailers have announced 77 million square feet of closures, according to CoStar Group (per Bloomberg), compared with the 105 million square feet that closed for all of last year. Not all of these are the result of bankruptcies, of course, but it is clear that retail’s shakeout shows no sign of abating any time soon.