After 60 years in business, off-price retailer Century 21 Stores filed for bankruptcy and will wind down its retail operations and begin going out of business sales at all 13 stores across New York, New Jersey, Pennsylvania and Florida.
The decision to shut down comes after the off-price chain’s insurance providers didn’t pay out $175 million to cover losses stemming from catastrophic Covid-19 business disruption, Century 21 said.
“While insurance money helped us to rebuild after suffering the devastating impact of 9/11, we now have no viable alternative but to begin the closure of our beloved family business because our insurers, to whom we have paid significant premiums every year for protection against unforeseen circumstances like we are experiencing today, have turned their backs on us at this most critical time,” said Century 21 co-CEO Raymond Gindi, alluding to the retailer’s comeback even after the Sept. 11 terrorist attacks in 2001 wrecked its downtown Manhattan flagship at 22 Cortlandt Street. “While retailers across the board have suffered greatly due to Covid-19, and Century 21 is no exception, we are confident that had we received any meaningful portion of the insurance proceeds, we would have been able to save thousands of jobs and weather the storm, in hopes of another incredible recovery.”
To effect an orderly wind-down of operations, the company filed a voluntary Chapter 11 petition in a federal bankruptcy court in Manhattan. It also has a lawsuit pending against several insurance providers in a Manhattan state court for alleged failure to compensate the company for losses under the policies. Century 21 is seeking to move the state court lawsuit under the jurisdiction of the bankruptcy court so adjudication and any recoveries can benefit stakeholders.
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The Chapter 11 petition listed estimated assets and liabilities each at between $100 million to $500 million. It’s largest unsecured creditor is The CIT Group, in Charlotte, N.C. at $5.9 million. Wells Fargo, in Boston, Mass., is owed $3.3 million, and Rosenthal & Rosenthal, Chicago, Ill., is owed nearly $3.3 million. Other lenders include Milberg Factors, New York, N.Y., at $790,176; Sterling National Bank, Chicago, Ill., at $789,585, and Hilldun Corp., New York, N.Y., $520,747.
Among its top unsecured vendors are Phillips Van Heusen Corp., Atlanta, Ga., $4.8 million; G-III Leather Fashions, New York, N.Y., $4.2 million; Peerless Clothing, St. Albans, Vt., $1.4 million; Adidas, Palaatine, Ill., $1.2 million; Delta Galil USA, Kansas City, Mo., $1.1 million; Michael Kors USA, Dallas, Tx., $1.0 million; Zara USA Inc., New York, $908,513, and Hanesbrands Inc., Chicago, Ill,, $783,855.
“Since 1961, when Al and Sonny Gindi opened what was then a small store in Downtown Manhattan, we have been proud to provide shoppers with unmatched access to designer brands at amazing prices,” said IG Gindi, co-CEO of Century 21. “While we wish that Century 21 could continue to be a must-see shopping destination for so many, we are proud of the pioneering role it has played in off-price retail and the iconic brand it has become. It has been a true honor for us to be part of the vibrant New York City fashion scene and to serve millions of locals, tourists, and celebrities, side by side.”
Century 21 stores are open for going-out-of-business sales, as well as online at c21stores.com.
Last November, Century 21 opened its first-ever popup at Herald Square at a former Forever 21 store, which showcased an updated, signature-red branding concept.
The privately held off-pricer’s original store at 472 86th Street in Bay Ridge, Brooklyn has remained in operation over the years, although it has since expanded from 6,000 square feet to 220,000 square feet. In addition to stores along the northeastern U.S. coastline, the retailer in August last year partnered with online grocer Boxed to curate an apparel and beauty assortment. It also had plans to open a new Long Island location at Roosevelt Field in Spring 2021, which would have relocated its current store on Old Country Road in Westbury.