It’s a done deal.
A consortium of investors has formed 888 Capital Partners LLC to acquire the iconic ABC Carpet & Home. The transaction closed on Sunday.
ABC’s CEO Aaron Rose will stay on with the company and work with the new ownership.
“Customers and interior designers can continue to shop ABC Carpet & Home, both in-store and online, for their and their clients’ decorating and entertaining needs—from artisan furniture, handcrafted décor and luxury items to one-of-a-kind gems that cannot be found anywhere else,” the new owners said in a statement.
The retailer will continue to offer a broad assortment of home furnishings, lighting, linens, tableware, rugs and carpeting. The retailer’s location at 888 Broadway at 19th St. in Manhattan and its warehouse outlet on the Brooklyn waterfront are both open for business. Gift cards and merchandise credits will continue to be honored.
ABC Carpet is best known for selling rugs north of $10,000. Its other luxury home décor assortments feature many sustainably-sourced items and other antique tchotchkes not found anywhere else. The Broadway flagship was closed for a brief period during the pandemic.
Similar to many retailers in 2020, ABC Carpet lost many of its regular clientele—and the sales that would have been generated—when they elected to move out of the city during the pandemic. Although many retailers either closed stores or filed for bankruptcy, ABC Carpet managed to hold on until this year, when it filed its chapter 11 bankruptcy petition last month. But, like many retailers that had to seek Chapter 11 protection, one of ABC Carpet’s failures was that it never really built out its digital marketing, and its e-commerce site could have used some updating and improvement.
ABC Carpet’s troubles began before the pandemic, which turned out to be the final nail in the coffin. The business was a much bigger operation at one time. Beginning in 2016, the retailer closed its 250,000-square-foot Bronx warehouse. That was followed by the sale of the four upper floors of the six-story Union Square flagship in 2017 for $133 million. And in early 2019, the home furnishings retailer closed its carpet store housed in the original location at 881 Broadway that was opened in 1947 when the business was known as ABC Carpet. When the business expanded years later to include home—at which point it was renamed ABC Carpet & Home—the retailer moved across from its original location to its current 888 Broadway flagship. The business kept the original site, which then focused solely on the sale of rugs and carpets. The company also was completing a lengthy renovation of its 60,000 square foot Union Square flagship during the pandemic, which made it difficult for shoppers who stayed in town to browse and shop. As the pandemic dragged on, slower sales had the retailer struggling to keep up with rent payments.
The new owner, 888 Capital Partners, received bankruptcy court approval of the sale on Wednesday. 888 is controlled by Regal Investments. Paulette Cole, creative director and the retailer’s fourth-generation owner in its pre-bankruptcy days, is part of the investment group and now holds a minority stake in the business. Prior to the bankruptcy, she put in millions of her own money to keep the company afloat. Her great grandfather Sam Weinrib founded the business at the end of the 19th Century in what was then a pushcart business serving the Lower East Side. 888 Capital agreed to forgive $15 million of debt in exchange for its ownership stake.
The Chapter 11 petition listed assets of up to $50 million, and liabilities of up to $100 million. Gross sales up to July 31, 2021 were listed as $25.46 million, half of that they were in the same 2018 period.