Younkers to shutter its doors as part of sale
Published 7:56 am Thursday, April 19, 2018
In a move that one city official called “a huge loss,” Younkers in Austin will close its doors as part of the sale of its parent company’s assets, pending bankruptcy court approval.
All stores operating under the Bon-Ton Stores, Inc., umbrella, will shut their doors, according to the company’s announcement late Tuesday. The closings include Herberger’s in Albert Lea.
In addition to Younkers and Herberger’s, the company’s stores operate under the banners of Bergner’s, Carson’s, Boston Store and Elder- Beermans.
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Bon-Ton Stores CEO Bill Tracy said the company failed to find bidders who would continue to operate the stores “as a going concern,” despite indications earlier this month that an investor group was ready to do just that.
Stores will remain open during the liquidation process, according to a company press release.
In February, Bon-Ton and its subsidiaries filed voluntary petitions for a court-supervised financial restructuring under Chapter 11. The company closed 47 stores in January. It operates 250 stores in 23 states.
“It’s terrible,” said Austin Area Chamber of Commerce Executive Director Sandy Forstner. “It’s a huge loss to our retail base.”
Tami Goodell, manager of both the Younkers store in Austin and Herberger’s in Albert Lea, declined to comment on the closing.
Although the news was not totally unexpected, given the February announcement of the Bon-Ton Stores’ plan to seek a restructuring bankruptcy, “our store here was doing quite well,” Forstner said. “We can only hope that another party might find a different opportunity” in the location.
The store, remodeled in just the past few years, is owned by Hy-Vee Stores. Its purchase and subsequent remodeling was tied to the 2015 Oak Park Mall sale and demolition, part of the new Hy-Vee store deal.
Tina Potthoff, vice president of communications for Hy-Vee, said Wednesday that the company was still processing the news.
“But I think it would be fair to say that Hy-Vee will be looking for another tenant” in the upcoming months, she said.
Austin City Administrator Craig Clark called the closing “disappointing,” but was hopeful that such a loss could turn to a positive for the city. The closing of one store can sometimes change the profile of a retail area “that can create opportunities in the marketplace,” he said. A prospective company that would not have considered a move to the area before might reconsider choices when the retail landscape changes.
Clark, who is also head of the Austin Port Authority, said the group continues to look for prospective tenants for the former Hy-Vee store, as well as a developer interested in creating retail space and a restaurant on a property along 18th Avenue Northwest.
“We hope to have news” about successful negotiations in those areas soon, he said.
He added the city “will do what we can do to facilitate” a new tenant for the Younkers building, if called upon.
Tracy said the company was “committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact of this development on our associates, customers, vendors and the communities we serve.
“We are incredibly grateful to all of our associates for their dedicated service to Bon-Ton and to our millions of loyal customers who we have had the pleasure to serve as their hometown store for more than 160 years.”
Throughout the court-supervised asset sale process, the company’s stores will remain open throughout the store closing sales. Over two dozen of the company stores operate in Minnesota.
Bon-Ton expects to provide more details about the liquidation plans and going out of business sales at its stores following approval of the winning bid by the bankruptcy court, according to its press release.