ANN ARBOR, MICH. — Borders Group Inc. announced late Monday, July 18, that it would liquidate after failing to receive any offers to keep the business going. The company, which employs nearly 11,000 people, is foregoing today’s scheduled bankruptcy-court auction. Borders said liquidation of its remaining 399 stores could start as soon as Friday, and it is expected to go out of business for good by the end of September, reports the Wall Street Journal.
The Journal also reported last week that Borders had a deal with an investor, Jahm Najafi, which unraveled Wednesday after publishers and landlords owed money from the company complained that his bid would allow him to liquidate the bookstore chain after buying the business.
Background on Borders’ Bankruptcy
Borders originally filed for Chapter 11 bankruptcy on February 16. At the time, the company planned to continue serving its customers in the normal course, to make employee payroll and continue its benefits programs for its employees, and to reorganize and implement a new business model for Borders to address the changing needs of the American reader.
“It has become increasingly clear that in light of the environment of curtailed customer spending, our ongoing discussions with publishers and other vendor related parties, and the company's lack of liquidity, Borders Group does not have the capital resources it needs to be a viable competitor and which are essential for it to move forward with its business strategy to reposition itself successfully for the long term,” said Mike Edwards, Borders Group President, as part of the Chapter 11 statement on February 16.
Borders then closed approximately 30 percent of its stores through a store reduction program designed to facilitate the Chapter 11. Prior to the filing, the company operated more than 900 stores in the U.S.
The Future of Borders’ Real Estate
Post-liquidation, DJM Realty, a Gordon Brothers Group company, has been retained to exclusively manage the disposition of all remaining Borders Group and Waldenbooks real estate in the United States.
“This group of Borders' stores has generated very strong interest from retailers. With a lack of new real estate development and restrictive barriers of entry in several key markets, surplus real estate like Borders becomes a very good opportunity for a number of growing retailers looking to open for business during the next 4 to 12 months,” said Andy Graiser, Co-President of DJM Realty.
The 259 remaining leases that are available for assignment in this bankruptcy disposition range from 10,000 to 40,218 square feet and are available in the following locations: Arizona (3), California (31), Colorado (7), Connecticut (3), Delaware (2), Florida (7), Georgia (7), Hawaii (3), Iowa (3), Idaho (2), Illinois (16), Indiana (4), Kansas (2), Kentucky (3), Louisiana (1), Massachusetts (8), Maryland (8), Maine (3), Michigan (13), Minnesota (3), Mississippi (1), Missouri (5), Montana (2), North Carolina (4), Nebraska (3), New Hampshire (3), New Jersey (8), New Mexico (3), Nevada (6), New York (18), Ohio (10), Oklahoma (1), Oregon (6), Pennsylvania (14), Puerto Rico (1), Rhode Island (2), South Dakota (1), Tennessee (5), Texas (12), Utah (1), Virginia (10), Vermont (1), Washington (9), Wisconsin (2) and West Virginia (2).
Borders property details are available at www.djmrealty.com.
— Dan Marcec