By Bob Uphues
The fate of the Carson Pirie Scott store in the North Riverside Park Mall remains fluid, with its parent company announcing the store's closure while at the same time saying it has found a buyer for the company's assets.
Mayor Hubert Hermanek Jr. on April 5 received a letter from The Bon Ton Stores, which is Carson's parent company, notifying him that the company intends to close the North Riverside store, which employs roughly 160 people.
"The closing is expected to be permanent and will affect the entire operation," states the letter from Gail Monreal, vice president of human resources for the Bon Ton Stores.
Monreal states in the letter that "the first separation from employment" is expected to be June 5 and that the process for closure would take several months. The letter was written in order for the company to notify affected employees and comply with federal law.
However, later in the same letter, Monreal states that the "timetable for closing is based on the best information available, although it is subject to change as we evaluate our options, including the option of selling the business and continuing as a going concern and subject to any actions of the bankruptcy court."
But this week, The Bon Ton Stores signaled there was hope for the floundering retailer in the form of an investment group being led by a pair of firms that own shopping centers across the country.
According to an April 10 press release, The Bon Ton Stores has received a signed letter of intent from Namdar Realty Group, Washington Prime Group and DW Partners "to acquire the company as a going concern."
DW Partners is an "alternative asset manager," according to the press release.
Namdar and Washington Prime own and operate retail properties throughout the U.S. Neither company owns the North Riverside Park Mall, and it is not clear whether the companies are intending to buy all of The Bon Ton Stores' assets or just those connected to Namdar and Washington Prime's commercial properties.
North Riverside Park Mall is owned by the Feil Organization.
The letter of intent itself, which was included as part of a bankruptcy court filing on April 9, states that the investment group proposes to acquire "substantially all of the debtors' assets."
An auction of the company's assets that was scheduled for Tuesday has been rescheduled for April 16, according to the press release.
The Bon Ton Stores, which is headquartered in Milwaukee and in York, Pennsylvania, operates 260 stores under the names Carson's, Bon Ton, Bergner's, Boston Store, Elder-Beerman, Herberger's and Younkers.
The company filed for Chapter 11 bankruptcy protection in early February, and at the time announced it was closing 42 stores, which are already in the process of winding down operations.
North Riverside's store was not among those slated for closure, but that has changed as the store's prospects for survival apparently have grown more precarious.
The Bon Ton stores had hoped a savior might be able to come up with a bid that would satisfy its creditors. Last week reports started to filter out that Namdar and Washington Prime were putting together a bid to save the stores in their shopping centers.
Meanwhile, the Milwaukee Journal Sentinel reported last week that liquidation firms, partnering with bondholders, were planning to submit a $740 million bid for the company, which would result in liquidation. Bids were due April 4.
Harvey Ahitow, general manager of North Riverside Park Mall, said that The Bon Ton Stores Inc. owns the space Carson's occupies. He said last week that he'd talked with an official from The Bon Ton Stores, who said no decisions have been announced related to any more store closures.
"There are ongoing negotiations and we don't know what the outcome will be," Ahitow said.
If Carson's closes its doors, the only remaining original anchor at North Riverside Park Mall would be J.C. Penney. North Riverside Park Mall opened in the mid-1970s, anchored by Carson's, Penney's and Montgomery Ward.
Montgomery Ward closed in 2001 and was replaced by Sears at the far north end of the mall. Amid its own struggles in recent years, Sears consolidated its North Riverside location on just one floor in the north anchor location last December.