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Z Gallerie latest retailer to file for bankruptcy protection, cl

Z Gallerie latest retailer to file for bankruptcy protection, cl

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by: snv86 Active Indicator LED Icon 8 OP 
~ 5 years ago   Mar 21, '19 4:02pm  
Z Gallerie latest retailer to file for bankruptcy protection, close Houston-area store
 
Home furnishings retailer Z Gallerie has become the latest brick-and-mortar retailer to declare bankruptcy.
 
The Los Angeles-based company, which has five locations across the Houston area, said in a press release that it filed for Chapter 11 bankruptcy protection on March 11 and plans to close 17 of its 76 stores.
 
One of the stores that will close is at Baybrook Mall, in Friendswood south of Houston, according to court documents. It's the only Texas store on the list of closures. An interim order approving procedures for store closing sales, among other things, was signed on March 15. A final hearing on the motion is scheduled for April 10.
 
In court filings, the company emphasized the need for fast proceedings to avoid liquidation.
 
"Convincing third parties of the turnaround story in a short period of time - and convincing them to work with the debtors towards the value maximizing outcome preferred by the debtors - will determine whether Z Gallerie survives," Weinsten wrote.
 
Z Gallerie said it expects to have access to a $28 million debtor-in-possession financing facility from its existing secured lender, KeyBank National Association. The DIP financing, which needs bankruptcy court approval, provides up to $8 million in incremental liquidity, and combined with its cash from operations, should provide sufficient liquidity for the company to maintain normal operations while it restructures.
 
"We are pleased to have reached this agreement with KeyBank that will enable Z Gallerie to continue to execute its strategy and position itself for long-term success," Z Gallerie CEO Mark Weinsten said in the release. "Z Gallerie has made significant progress on improving all facets of our operations, enhancing our customer service and scaling our E-commerce presence. Upon emergence, we will have a stronger balance sheet and the financial flexibility needed to compete in today's dynamic retail environment now and for the long term."
 
Z Gallerie said it expects the Chapter 11 process to last four months. The remaining 59 stores will stay open, and customers can also continue to shop online, the company said.
 
"We look forward to emerging from this process as quickly as possible and greatly appreciate the ongoing support of our employees, customers, suppliers and landlords," Weinsten said. "Their continued backing has been, and will continue to be, an integral factor in our success."
 
In its filing, Z Gallerie reported about $138 million of outstanding debt-funded obligations and cash balance of less than $2 million, according to Bloomberg. Its petition estimates as much as $500 million in assets.
 
This would be the second bankruptcy filing for Z Gallerie, which was founded in Sherman Oaks, California, in 1979. It previously filed for Chapter 11 in April 2009 and emerged later that year after closing 25 stores.
 
www.bizjournals.com/ houston/news/2019/03 /20/z-gallerie-lates t-retailer-to-f
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AJ8410 Active Indicator LED Icon 6
~ 5 years ago   Mar 21, '19 8:15pm  
Not surprised! They are ridiculously overpriced and the items they sell are only good for a "certain look", that is, it isn't something you can pass down to the kids or be in vogue 5 years from now. My sisters and I prefer retailers like Wayfair and West Elm
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