The Canadian owner of 322 Garage and Dynamite women’s clothing and accessories stores has filed for bankruptcy in the U.S. and plans to close some of its locations after struggling with fallout from the coronavirus pandemic, the Wall Street Journal reported. Montreal-based Groupe Dynamite Inc. filed its chapter 15 petition on Tuesday in response to “the refusal of certain landlords to negotiate and agree on a Covid-19-adjusted rental model,” Andrew Lutfy, executive chairman, said in a sworn declaration filed with the U.S. Bankruptcy Court in Wilmington, Del. The company, which is undertaking similar legal proceedings in Canada, said that it expects its business to continue to suffer until a vaccine is available. One of the goals of the retailer’s restructuring is to free itself from a minority of its leases that are deeply unprofitable, Lutfy said. But the business also wants to renegotiate leases of other unprofitable stores, and, if those talks fail, those locations could close as well, he said. Groupe Dynamite has been able to renegotiate 22 of its 322 leases, Lutfy said. Read more. (Subscription required.)
Occupancy issues are at the heart of many significant retail cases, as detailed in the ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available at the ABI Store.
