Barneys store in LV to shutter
Venetian location, 14 others targeted after bankruptcy
Barneys New York will no longer line the halls of the Grand Canal Shoppes at The Venetian.
The luxury retailer announced Tuesday it would shutter its 85,000-squarefoot anchor location at the upscale shopping center after filing for Chapter 11 bankruptcy protection in the Southern District of New York. It didn’t say when the store will close.
The 96-year-old retailer was able to secure $75 million in financing for operational costs and paying creditors as it looks for a buyer, but it plans to close more than half of its locations.
Out of its 22 brick-and-mortar and warehouse stores, Barneys said it would shut down 15 locations, including the Las Vegas store and those in Chicago and Seattle. Its 10-story Madison Avenue store will remain open as well as stores in Boston, Beverly Hills and San Francisco and two warehouse locations in New York and California.
“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, Barneys chief executive and president, said in a statement.
The chapter 11 filing said a shift in consumer spending habits from brickand-mortar to online coupled with more than $10 million in rent increases on an annualized basis “severely decreased” Barneys’ pre-tax earnings and “significantly constrained liquidity.”
Barneys’ woes took the spotlight several months ago when the rent at its Madison Avenue location nearly doubled to $30 million. It fought the increase but lost during arbitration earlier this year.
The retailer, controlled by New Yorkbased hedge fund Perry Capital, listed more than $100 million in assets and more than $100 million in debts. With
This set the company back in other areas; adjusted cash flow fell 7.6 percent to $115.2 million.
“Like any new project, expenses open much higher than you would normally expect,” Cootey said. “There are expenses that will be reduced as time moves on.”
When asked whether the renovated properties were cannibalizing
other casinos in Red Rock’s portfolio, Cootey said the company was seeing the reverse, with only about 40 percent of visitors being local.
“The addition of the Palms is actually increasing organic growth,” he said. “We’re pretty happy from a locals perspective. And (as for) out-of-town (visitors), we’re taking them from the Strip properties.”
Las Vegas’ economic standing was another boon to the company’s net revenue, Cootey said. He pointed
to developments like Allegiant Stadium and the Las Vegas Convention Center as well as the state’s regulatory environment and low taxes.
Net revenues in Las Vegas grew 16.3 percent to $457.8 million.
“We continue to view the Las Vegas locals market as the most attractive gaming market in the United States,” he said. We “remain uniquely positioned to take advantage of the ongoing growth in this extremely vibrant market.”