It’s been revealed that Barneys, the luxury department store chain, is filing for bankruptcy after almost a century of business.
A combination of rising rents and dropping footfall has been blamed for the financial issues, with the rent of its Madison Avenue store tripling in the past year alone.
“Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand,” said Barney’s Chief Executive Officer Daniella Vitale when speaking to Bloomberg.
The company is filing for Chapter 11 bankruptcy, which will allow it to reorganise its affairs and work out a plan of action for the future, without necessarily going out of business. The overall aim will be to work out a way to pay off its debts, reduce overheads, and continue towards a profitable future. How likely this will be remains to be seen, as its existing liabilities are listed as between $100 million and $500 million.