Borders, the 40-year-old bookseller that morphed from small independent to superstore behemoth, filed for bankruptcy after months of financial woes, and on Wednesday announced the closing of half of the Chicago area’s bookstores by late April.
As part of its Chapter 11 bankruptcy filing, the retailer, which has suffered big debts, declining sales, increasing competition and missed payments to vendors, said it will shutter 15 of the area’s 31 bookstores and leave the city of Chicago with only one Borders store — on State Street in the Loop.
The five Chicago store closings will cost 174 employees their jobs, and the suburban closings will affect 292 employees, a Borders spokeswoman said. Most employees are part-time, said spokeswoman Mary Davis.
Just a month ago, on Jan. 7, Borders closed its store at 830 N. Michigan Ave., and it already was set to close the Borders store in Hyde Park, at 1539 E. 53rd St., in early March.
Other Borders stores will remain open in Algonquin, Geneva, Gurnee, LaGrange, Oak Brook, Oak Park, Orland Park, Naperville, Schaumburg, Wheaton, Wilmette, and in Highland, Ind., according to a list of stores at Borders’ website. The company also operates smaller Waldenbooks and Borders Express stores and will keep open a Waldenbooks at 500 W. Madison St. in Chicago and a Borders Express at the Chicago Ridge Mall, according to the list.
Borders will honor its gift cards, Davis said. The closings may provide an opportunity for Wal-Mart to identify new sites for its planned 24 stores in Chicago, one retail expert said Wednesday. A Wal-Mart spokesman said the retailer is “having hundreds of conversations across the city” about locations, and would consider multi-story sites. The new Wal-Mart stores will vary in size from less than 30,000 square feet to more than 80,000 square feet. The six Borders closing in Chicago, including one in Hyde Park that the company previously announced it would close March 7 and was not part of the bankruptcy filing, range in size from 24,000 to 42,700 square feet.
The targeted Borders sites could also attract health clubs, banquet halls or drugstores such as CVS and Walgreens, but their two-story configurations make it likely that some will be divided to attract more than one tenant, said Daniel J. Hyman, president of Millennium Properties R/E Inc. in Chicago.
Nationwide, Borders’ effort to survive includes shuttering 200 of its 642 stores, securing $505 million in debtor-in-possession financing and reorienting itself to today’s growing online and digital book-selling strategies. The bankruptcy filing showed that the retailer had $1.28 billion in assets, $1.29 billion in debts, and owes $178.8 million to vendors and $18.6 million to landlords.
The company’s history is the story of two brands: Borders and Waldenbooks. Tom and Louis Borders opened an 800-square-foot used bookstore in 1971 in Ann Arbor, Mich., home of the University of Michigan. The brothers opened additional stores over the years.
Waldenbooks began as Walden Bookstore, opened in Pittsburgh in 1962 and named in honor of Henry David Thoreau’s classic, Walden.