Luxury retailer Barneys has filed for bankruptcy.
“Trends come and go, but institutions are timeless,” the brand wrote on its social channels following the news. According to Bloomberg, Barneys filed for Chapter 11 bankruptcy after getting hit with high rent and fewer visitors purchasing from the luxury boutiques. Luckily, Chapter 11 filings allow businesses to remain open as they devise a plan to tackle financial issues.
Still, Barneys is downsizing and has decided to shutter a bunch of its stores, including locations in Chicago, Las Vegas and Seattle as well as five smaller concept shops and seven of its Barneys Warehouse stores. Barneys will keep its flagship shops in New York (Madison Avenue and Downtown New York City), California (Beverly Hills and San Francisco), and one in Boston (Copley Place), in addition to its Warehouse spaces in Woodbury Commons (NY) and Livermore (CA).
“Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand,” Daniella Vitale, chief executive officer at Barneys, said in a statement Tuesday, adding that the move “provides the quickest and most efficient means of maximizing value while ensuring we continue serving both new and loyal customers.”
Barneys did, however, secure “$75 million in new capital to facilitate a going concern sale process,” so not all hope is lost.