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READING, PA-Locally based department store chain Boscov’s has filed for Chapter 11 protection under the US Bankruptcy Code and plans to close 10 of its 49 locations. Although some news outlets have reported that the company is up for sale, a spokeswoman tells GlobeSt.com that it’s too soon to tell.

“Boscov’s is looking at a range of options to improve its financial base and at this point, it would be premature to comment on what course it will take,” the spokeswoman says. “It is Boscov’s goal to complete the restructuring process as soon as possible. The company intends to begin work immediately with its creditors and other constituencies and file a plan of reorganization by later this fall.”

In a press release, Kenneth Lakin, chairman and CEO of Boscov’s, cites “the downturn in the overall economy and consumer spending along with the serious credit market crunch.” He adds “we have made the strategic decision to utilize a Chapter 11 filing to proactively address our capital structure. As we progress with the restructuring, our stores and website will remain open for business.”

Boscov’s has secured an agreement in principle for $250 million in debtor-in-possession financing from Bank of America. It is intended “to support healthy merchandise flow as the company prepares for the back-to-school and holiday selling seasons,” according to the release.

The 97-year-old regional chain is the latest high-profile retail casualty of the faltering economy, joining Mervyn’s, S&A Restaurant Group and Steve & Barry’s, all of which filed for bankruptcy within the past four weeks. However, insolvency does not always mean the end of the line for a retailer: what is now Federated Department Stores, owner of the 800-unit Macy’s chain, filed for bankruptcy in 1990.

Local retail leasing expert Steven Gartner tells GlobeSt.com that “I wouldn’t count Boscov’s down and out at all.” He adds, though, “they certainly are faced with challenges as everyone is facing in this economy.”

Key among those challenges is the competitive landscape for retailers, says Gartner, president of Conshohocken, PA-based Metro Commercial Real Estate Inc. “Nobody owns a category or a customer today,” he says. “There are abundant opportunities for people to buy pretty much everything that is sold in a Boscov’s. The Boscov’s customer, while seemingly pretty loyal, is a value shopper and will go to multiple locations.”

Although the ranks of department store names in the Philadelphia region have thinned—Wanamaker’s, Strawbridge, Stern’s and Kaufmann’s have all passed into history–the number of stores has not diminished significantly, Gartner says. With Macy’s now an 800-store “behemoth,” Federated now commands greater purchasing power than regional chains, he says. In addition, he says “there are 100 Target stores that did not exist 15 years ago. Kohl’s did not exist in this market 15 years ago.”

Five of the 10 Boscov’s locations slated to close are in Pennsylvania. They include two Philadelphia-area stores at the Oxford Valley Mall in Langhorne and the Montgomery Mall in North Wales and one at the Harrisburg East Mall, according to a news release from the company. Other stores due to be shuttered are in Pittsburgh and Monroeville, PA; Baltimore, Owings Mills and White Marsh, MD; Eatontown, NJ; and Danville, VA. Some of these locations are among the 10 that Federated had sold to Boscov’s in February 2006.

The markets where the stores are being closed are all “relatively tight for real estate,” Gartner says. “I suspect the landlords will have to become creative in terms of re-merchandising those spaces, but they’ll be snapped up by other merchants–not necessarily department stores.” He predicts that in some instances, the spaces will be broken up to accommodate smaller tenants.

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