Keep calm, local luxury fashion shoppers in need of an $8,000 sport coat or $1,250 sandals — the Barneys New York store in Boston will remain open despite the company’s plan to close most of its shops nationwide in conjunction with a Chapter 11 bankruptcy filing.
The struggling department store chain announced Tuesday that 15 of its 22 stores will go dark. The store at Copley Place in the Back Bay, however, will stay in business, along with four other flagship locations in New York and California, and two discount warehouses.
The Barneys in Boston is one of the company’s top-performing locations, a Barneys representative said. The company also still plans to open a restaurant, Freds at Barneys New York, later this year at Copley Place.
Barneys began in New York in 1923 as a discount clothing store, but it has long been known for high-end clothing, beauty products, and home goods from designer brands such as Balenciaga, Givenchy, and Chanel. It features products such as a $10,200 floral-embellished tulle dress from Fendi and a pair of Deakin & Francis skull-shaped cuff links for $7,995.
As with other retailers, the chain’s store sales have been hurt as more consumers do their buying online.
“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,” chief executive Daniella Vitale said in a statement.
The company cited rent costs as a reason why it filed for Chapter 11 bankruptcy in US Bankruptcy Court for the Southern District of New York. At its flagship store on Madison Avenue in New York City, for example, rent doubled this year to nearly $30 million.
Following the bankruptcy filing — which was widely expected — landlords may be offering the company more attractive lease terms or other incentives to ensure that the spaces don’t become vacant as the holiday season nears, said Lauren Beitelspacher, an associate professor in marketing at Babson College who studies retail management.
Ani Collum, a retail strategist for commerce consultancy Trade Collective, said the company is “making sure the locations they keep alive aren’t super expensive in terms of how they relate back to sales.”
Barneys also said Tuesday that it has secured $75 million in funding to review its current leases, pay employees, and optimize operations as it seeks a buyer.