By Barry Janoff
May 30, 2016: Sports Authority, considered for years among the top sports retailers in the nation, is on its final legs.
The Englewood, Col. company said that its remaining retail leases would be sold by A&G Realty Partners, a leading commercial real estate, advisory and investment group.
The company posted "Going Out Of Business" signs in all its remaining locations and on its home page. "Starts today! Everything now up to 30% off original ticketed prices. In-store only. (Some exclusions apply.)."
The retailer's loyalty and credit card programs ended on May 25.
The list of locations for sale includes 50 in California, 48 in Florida, 27 in Colorado, 24 in Illinois, 18 in the state of Washington and 16 in New Jersey.
In all, Sports Authority is seeking to sell some 320 locations in 34 states.
Under Armour said on Tuesday (May 31) that it had to revise its previously issued outlook for the full year and Q2 "following recent developments related to the bankruptcy proceedings of The Sports Authority."
"Given the recent decision of the bankruptcy court to approve the liquidation of The Sport Authority's business rather than a restructuring or sale of the ongoing business, the company now expects to recognize an impairment charge of approximately $23 million related to The Sports Authority during the second quarter of 2016," Under Armour said in a statement. "In addition, due to the bankruptcy, the company was only able to recognize $43 million of the originally planned $163 million in revenues with The Sports Authority for 2016."
According to Kevin Plank, chairman and CEO for Under Armour, "While The Sports Authority's bankruptcy impacts our 2016 outlook, our brand's momentum is stronger than ever as we continue to see growth and increased demand across all categories and geographies. This one-time event will not impact our focus on making the best decisions for Under Armour through investments that protect and drive our growth."
At its apex, Sports Authority, which was founded in 1987 but traces its history back to 1919, had more than 460 locations.
According to the company, A&G Realty is currently accepting bids on the remaining leases, "which range from 10,000 to 80,000 square feet located in many of the major retail markets in the country including prestigious locations in NYC, Chicago, Los Angeles, Dallas and Miami."
In an unrelated situation, A&G Realty is also handling the sale of nearly 60 Sport Chalet leases in Arizona, California and Nevada.
In 2011, Sports Authority signed a 25 year deal, valued at $150 million, for naming rights to the field at Mile High Stadium, home for the NFL's Denver Broncos. The future status of that deal remains uncertain.
Regarding the brick-and-motor locations, in a letter addressed "Dear Customers," Sports Authority CEO Michael Foss wrote:
"Sports Authority and its predecessor companies have been serving the sporting goods needs of our customers since 1919. It is with great sadness that we are intending to close all of our stores by the end of August.
"We will be holding store closing sales at all of our locations that will allow you to take advantage of big discounts on great brands.
"On behalf of the entire Sports Authority team, I would like to express our sincere appreciation to our customers for their years of loyalty. It has been a pleasure to serve you and your family."
According to Emilio Amendola, co-president, for A&G Realty, “(Sports Authority) has done a great job with its real estate and their locations are well positioned in key retail street and power center locations. By taking assignment of leases, retailers have the opportunity to enter new markets and gain access to projects they may have previously been unable to penetrate."
Amendola said he expects store closing sales to run through August but "bids for the leases are due June 23 with an auction set for June 29 in Wilmington, DE.
"Interested parties should move quickly on submitting offers for leases before the bid deadline,” said Amendola.
How Shoppers Put Sports Authority In Chap. 11
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