Discount Legend Century 21 Files for Chapter 11

Off-value retail pioneer Century 21 Merchants submitted for individual bankruptcy on Thursday with a system to close all its stores, citing the refusal of its insurers to address its losses from the coronavirus pandemic.

The liquidation of Century 21’s property by means of the Chapter eleven individual bankruptcy approach would close a run of almost 60 several years for a company that was launched by the Gindi relatives in Bay Ridge, Brooklyn, in 1961.

The firm, which has thirteen stores mostly in New York Town and the bordering metropolitan spot, produced somewhere around $747 million of profits in fiscal 2019 but, like other stores, experienced been hit challenging by the pandemic, which forced it in mid-March to close all its spots.

Even with stores getting reopened, Century 21 mentioned it could no extended continue to be in company due to the fact its insurers “have turned their backs on us at this most critical time,” declining to provide the $175 million it was in search of in coverage for company disruption losses ensuing from the pandemic.

“We are assured that experienced we gained any meaningful portion of the insurance policies proceeds, we would have been capable to help save hundreds of work opportunities and climate the storm,” co-CEO Raymond Gindi mentioned in a information launch.

Century 21 sued its insurers in July but CFO Norman Veit mentioned the firm experienced to file individual bankruptcy in component to prevent its landlords from pursuing eviction proceedings to judgment and/or seizing its inventory to fulfill rents owing.

“The debtors believe that [the individual bankruptcy] courtroom can provide an expedited resolution of the insurance policies motion that will produce important proceeds and certainty for the debtors and their estates,” he mentioned in a courtroom declaration.

As New York Journal studies, Century 21 was famed as “a low cost mecca: a treasure trove in which, if you ended up ready to spend several hours digging (and it’s possible get into a battle), you could locate a holy-grail luxury product at anything like ninety nine.ninety nine {bcdc0d62f3e776dc94790ed5d1b431758068d4852e7f370e2bcf45b6c3b9404d} off.”

But even prior to the pandemic, Veit mentioned, it experienced been adversely influenced by “the shifting of revenue from standard brick-and-mortar stores to on the web stores, and altering consumer preferences.”

(Photo by John Nacion/SOPA Photographs/LightRocket via Getty Photographs)
Century 21 Merchants, chapter eleven, coronavirus, COVID-19, low cost retail, Insurance, Norman Veit, Raymond Gindi