Thank you for sharing!

Your article was successfully shared with the contacts you provided.

RICHMOND, VA-The worsening economy has claimed another victim–Circuit City, the country’s second largest electronics retailer, is filing for bankruptcy, as consumer spending on discretionary items practically slows to a halt. As with most corporate bankruptcies Circuit City intends to continue operations while management develops a comprehensive corporate restructuring plan.

The company has provided ample notice to the market that it was in trouble. On Nov. 7 it announced workforce reductions of some 20%.Then, last week it announced it would close 155 domestic stores and renegotiate leases in other locations. By the time the closings are complete there will be approximately 566 stores in Circuit City’s real estate portfolio. It also hinted that other options were being explored–language that my have implied an impending bankruptcy.

Clearly these cost-cutting initiatives will continue in bankruptcy. In its announcement this morning the company said it was also taking action to realign its regional and district support structure commensurate with its smaller store base. Also, “the company will continue its real estate rationalization by taking immediate steps to reject the leases at its previously closed locations,” it said in a press release. “Further, as part of its restructuring efforts, the company will continue to assess the productivity of all assets, review additional cost-cutting initiatives and explore strategic alternatives to maximize the value of the business.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.