Women’s clothing retailer Forever 21, which operates a 16,000-square-foot store at the North Riverside Park Mall, announced it could close up to 178 of its U.S. locations after filing for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court in the District of Delaware on Sept. 29.

In a court filing on Oct. 1, lawyers for the company submitted a list of stores it intends to close, including eight in Illinois. The North Riverside location, which the company nearly tripled in size in 2014, was not on the list.

“They are closing stores that not performing,” said Harvey Ahitow, general manager of the North Riverside Park Mall, which is owned by the Feil Organization. “But, Forever 21 is doing well in our center, far above the average.”

Among the high-profile locations slated for closure in Illinois are the Forever 21 stores in Water Tower Place on North Michigan Avenue in Chicago, at 10 S. State St. in the heart of Chicago’s Loop, Yorktown Mall in Lombard and Westfield Old Orchard Mall in Skokie.

In a letter to customers posted on Forever 21’s corporate website, the company held out hope that not all of the 178 locations would close as a result of the bankruptcy proceedings.

“The decisions as to which domestic stores will be closing are ongoing, pending the outcome of continued conversations with landlords,” the company’s letter stated. “We do, however, expect a significant number of these stores will remain open and operate as usual, and we do not expect to exit any major markets in the U.S.” 

The company operates 549 stores in the U.S. Many of company’s 251 stores located outside of the U.S. are also expected to close as a result of the bankruptcy action, according to published reports.

While the fact that Forever 21 did not include North Riverside’s location on its preliminary closure list, other major retailers who filed for bankruptcy and subsequently liquidated in recent years — Sports Authority, Toys R Us, H.H. Gregg, Payless Shoes and Carson Pirie Scott — also initially held onto their North Riverside locations.

In its letter to customers, Forever 21 said filing for bankruptcy protection “allows Forever 21 to continue to operate its stores as usual, while the company takes positive steps to reorganize the business so we can return to profitability. … [The move] is a deliberate and decisive step to put us on a successful track for the future.”

Ahitow credited the opening of Forever 21 in 2008 as a catalyst for other high-profile retailers, like H&M, following suit.

“We attracted a number of national tenants because of them,” Ahitow said.

While the North Riverside store performs well, Ahitow said, Forever 21’s aggressive expansion efforts after 2010 led to its current predicament. Instead of stores sized like the one in North Riverside, the chain started taking over what Ahitow described as “mini-department store spaces” as large as 50,000 to 75,000 square feet.

“That was a huge mistake for them,” Ahitow said.

Old Navy staying put

Ahitow also confirmed that Old Navy, the budget clothing retailer which has called North Riverside Park Mall home for two decades, will remain in its 15,000-square-foot space in the lower level of the shopping center.

That news comes in the wake of Old Navy’s plans to open a similar-size store at 7085 Cermak Road in Berwyn, next to Tony’s Fresh Market in the Cermak Plaza. Michael Flight of Concordia Realty, which manages Cermak Plaza, said Old Navy hopes to open its new store before the holidays.

Old Navy is a longtime tenant of the North Riverside Park Mall and at one time occupied 20,000 square feet there. Several years ago, as part of lease renewal negotiations, the company downsized the mall store by 5,000 square feet.

“North Riverside is a good store for them, and it’ll continue to be a good store,” said Ahitow, who added that Old Navy signed a long-term lease renewal for the mall location last year. 

“They’ve done this with a number of stores in different locations. We’ll see what the impact it has on us.”

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