JOANN Fabric and Crafts is selling off at least 30 locations in one state as it conducts going-out-of-business sales nationwide.
The beloved retailer went bankrupt in January and cited around $615 million in debt.
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It’s the second time Joann has submitted a Chapter 11 filing in about a year.
The first was in March 2024, and about a month later, it was saved after finding a buyer, restructuring, and chipping away at what was over $500 million owed to several creditors.
Joann also managed to get out of closing any stores at the time, but that’s not the case for the second bankruptcy.
It initially expected to shutter about 530 nationwide, leaving about 320 operational.
Read More on Bankruptcies
DOWN FOR THE COUNT
However, last month, Joann confirmed all of its estimated 850 stores in 49 states would close for good.
At least 30 of those are in New York, all of which recently had their leases go up for sale, per a Thursday news release from retail liquidator GA Group and real estate company A&G Real Estate Partners.
“The auction of Joann’s store leases presents a unique chance to transform well-located retail spaces into thriving businesses,” Emilio Amendola, co-president at A&G, said in the release.
“For small business owners and startups, this is an opportunity to lock in prime locations at competitive rates — helping them grow, innovate, and revitalize local economies.”
A bidding process for the 30 Joann leases is expected to take place on April 22.
There’s also a bid deadline for lease takeovers on April 16.
CARD CONFUSION
While customers have detailed heartbreak after Joann’s confirmation that it would be gone for good, others are still furious over an ongoing and “upsetting” gift card policy.
Joann noted that amid liquidation sales, it would accept customer gift cards until a deadline of February 28.
With many locations still in the middle of the shutdown process, some shoppers feel the rejection of the gift cards since that time has been unfair.
“I just want you to know how incredibly upsetting it is that you cut off our ability to use gift cards,” a longtime Joann customer fumed in an Instagram post from the retailer about its 40% off discounts.
How does bankruptcy work?
Bankruptcy is a specific legal process that helps companies eliminate debt they can’t repay.
The process allows businesses to start fresh and gain access to new credit.
Supervised by federal courts, bankruptcies allow a company to sell off its assets more easily to pay off creditors, according to Investopedia.
Chapter 11, a common process for companies, is used to restructure a business with the goal of remaining open – even if it means selling off most of the company’s properties.
Chapter 7, on the other hand, sells all of a company’s assets, putting it out of business.
Chapter 15, alternatively, allows for collaboration between American and foreign courts to conduct bankruptcy proceedings with “parties of interest involving more than one country,” per the United States Courts.
“Regardless of the fact that you are closing, your business took money and now refuses to give the product in exchange for it. Wrong.”
“So upset you cut off gift cards so quickly and with little notification,” wrote another.
Some even went as far as to accuse Joann of “theft and fraud” for the gift card policy, although that’s inaccurate.
Several other retailers have experienced bankruptcy woes in the past year.
Big Lots notably filed in September and will only have around 200 stores left open after it reached a last-minute deal.
Forever 21 also submitted its second bankruptcy filing earlier this month after a first in 2019 and will close its remaining stores.
