Ascena Retail Group, the parent company of clothing stores like Lane Bryant, Catherine’s, and Justice, has joined a long list of large companies to file bankruptcy in the wake of the coronavirus pandemic. Brick and mortar retail was already struggling, and months of stay at home restrictions have been the final straw. Ascena has chosen Chapter 11 so that some of its subsidiaries can continue operating. However, a significant amount of Arizona clothing stores will be closing as part of this bankruptcy.
Ascena Retail Store Closures in Arizona
There are 688 Lane Bryant locations, Ascena has announced that four Arizona Lane Bryant stores would be closing as part of the bankruptcy.
The Lane Bryant stores Closing are located at:
• Gilbert- 3855 South Gilbert Road
• Gilbert- Baseline Road and N. Cooper Road
• Mesa- 6555 E. Southern Ave.
• Tucson- 5351 S. Calle Santa Cruz
Ascena also owns Catherine’s, a plus size women’s store. Ascena plans to focus attention for this brand on online retail, as opposed to brick and mortar. All of its locations are closing in the bankruptcy.
The 6 Catherine’s Stores Closing in Arizona:
• Chandler- 2986 N. Alma School Road
• Glendale- 5350 W. Bell Road
• Mesa- 5052 S. Power Road
• Mesa- 833 N. Dobson Road
• Peoria- 9282 W. Northern Ave.
• Tucson- 4730 E. Broadway Blvd.
Justice, a girls’ clothing store formerly known as Limited Too, is also owned by Ascena Retail Group. Justice has 826 locations, approximately 600 of which are closing in the bankruptcy. As with Catherine’s, Ascena plans to focus more on the online side of this brand.
The Justice clothing locations Closing in Arizona include:
- Avondale- 9945 W. McDowell Road
- Gilbert- 1073 W. Baseline Road
- Glendale- 5350 W. Bell Road
- Glendale- 6800 N. 95th Ave.
- Mesa- 6555 E. Southern Ave.
- Peoria- 25546 N. Lake Pleasant Highway
- Phoenix- 21001 W. Tatum Road
- Phoenix- 2501 W. Happy Valley Road
- Scottsdale- 16451 N. Scottsdale Road
- Tempe- 5000 S. Arizona Mills Circle
- Tucson- 4500 N. Oracle Road
- Tucson- 5870 E. Broadway Road
Ascena also owns Ann Taylor and LOFT, but only one Ann Taylor Factory Store is closing in Arizona. It is located in Glendale at 6800 N. 95th Ave. Stores that have begun to reopen as stay at home orders are lifted have realized it’s too little too late, and it’s time to file bankruptcy. Ascena Retail Group will be joining Neiman Marcus, JC Penney, J. Crew, True Religion, Lucky Brand, and more on the list of fashion retailers to fall victim to COVID-19. Many of the Ascena locations that are closing are even at the same shopping malls. The pandemic has made it clear that online shopping has officially won the battle over fashion retail.
Arizona’s Unemployment Rate
Arizona saw a spike of unemployment claims in April 2020, with an unemployment rate of approximately 13.4 percent. Conditions improved and the unemployment rate was down to around 9% in May, but has crept back up to 10% for June. The extra $600 weekly federal unemployment benefit is ending soon, as well as Arizona’s eviction moratorium. With at least 20 Ascena-owned stores closing in the bankruptcy, Arizona will hopefully at least be able to keep the unemployment rate static for July.
What is Chapter 11 Bankruptcy?
Ascena has chosen Chapter 11 Bankruptcy because it allows the company to keep some store locations running and also continue operating online sales. Chapter 11 is also known as a Business Bankruptcy. It is the Chapter that a lot of businesses have to use when considering a bankruptcy for their business that they intend on still operating the business. When a company files Chapter 11, its top creditors will form a bankruptcy panel. This will give them control over business decisions like entering new contracts and selling assets, while leaving day to day operations in the hands of ordinary management. Debts will be restructured with the approval of the panel, with the filing company usually securing funding to emerge from the bankruptcy with a well-defined plan to return to profitability. Businesses also have the option of filing Chapter 7, which would discharge the liabilities for all of the company’s debts. However, the business would have to shut down entirely and surrender all of its assets and inventory. Both Chapter 7 and Chapter 11 are available to businesses as well as individual filers. Individual filers also have the option of Chapter 13, which is a debt reorganization payment plan not available to businesses.