Struggling to compete with online brands, famed Big Apple luxury retailer Barneys New York has put itself up for sale and filed for bankruptcy protection, according to a report by Reuters.
The company has a long history — almost a century — and has enjoyed a position of prestige as it attracted socialites and held a reputation for the finest luxury apparel. However, the company hasn’t been immune from the same market conditions that sent Sears and Kmart into bankruptcy. It’s also dealing with a massive rent hike at its headquarters which sent it frantically searching for a buyer.
The company said it received $75 million in new capital from Hilco Global and the Gordon Brothers Group to keep the lights on during the bankruptcy protection proceedings. The company said that it was going to close stores in Las Vegas, Seattle, Chicago and other smaller places, as well as seven warehouse locations, and focus on key stores.
Barneys wants to keep its main store in Manhattan, and also four other locations. Rent at its Madison Avenue store went from $16 million to about $30 million.
Chief Executive Officer Daniella Vitale said that board members and company executives “have taken decisive action by entering into a court-supervised process, which will provide the company the necessary tools to conduct a sale process, review our current leases and optimize our operations.”
One man, a retiree in Italy named Peter Knight-Barnard, said he remembered the glory days of Barneys New York in the ‘80s and ‘90s when it was what he called the “the spot.” He said one of the first things he bought from the store was a cashmere sweater.
“Just walking around with one of their shopping bags in those days was a status symbol,” the 69-year-old said. “It was a big Saturday scene with all the great and good from Wall Street milling around.”