The new year is kicking off with the auction of nearly 700 Party City store leases, a spillover of 2024's series of retail bankruptcies and liquidations.
The Woodcliff Lake, New Jersey-based chain, after filing for Chapter 11 bankruptcy protection last month, is winding down its operations and holding going-out-of-business sales at its store fleet across the nation. The nearly 40-year-old chain's real estate adviser, A&G Real Estate Partners, will be holding an auction of 695 Party City leases in 44 states, pending court approval
The bid deadline and auction likely will be in early February for all but one of the stores, according to A&G. A location at 3090 Mountain View Drive in Anchorage, Alaska, will be finishing its liquidation sale this month, so its bid deadline is Friday, A&G said.
The auction is part of the aftermath of last year's stream of retailer Chapter 11 filings, chain liquidations and store closings, as the industry was pummeled by high interest rates increasing their costs, consumers tightening their purse strings amid high inflation, and the aftershocks of the pandemic. The retailers that went out of business included 99 Cents Only, Sam Ash Music, American Freight, Conn's HomePlus and Badcock Home Furniture & More.
Party City specifically cited “an immensely challenging environment driven by inflationary pressures on costs and consumer spending, among other factors,” for its most recent bankruptcy.
The retailer's Chapter 11 filing is its second in just under two years. It first filed in January 2023, emerging in September of that year with less debt and a smaller store footprint.
“This is a large and diverse store portfolio, with good real estate and a great many stores located in high-traffic shopping centers,” Emilio Amendola, AG co-president and leader of the New York-based company’s real estate sales division, said in a statement.
The available leases are for freestanding stores as well as those located in power centers, strips and city street locations, according to A&G. The Party City stores range from about 7,000 to 46,000 square feet.
“You’ve got a number of strong candidates for this real estate,” Mike Matlat, A&G senior managing director, said in the statement. “The list includes gyms and entertainment tenants, dollar stores, local specialty retailers, furniture stores, and medical office clinics.”
The stores are ready for immediate occupancy "with favorable lease terms in both suburban and urban retail markets,” Andy Graiser, co-president of A&G, said in the statement.
The auction will take place at the Manhattan office of Party City legal counsel Paul, Weiss, Rifkind, Wharton & Garrison at 1285 Avenue of the Americas.
Not every Party City store is closing. At least 29 locations are owned by franchisees, including stores in Austin and San Antonio in Texas, which plan to remain open.
Here's how many leases are available in the auction by state:
- Alaska, one.
- Alabama, 10.
- Arkansas, one.
- Arizona, 15.
- California, 82.
- Colorado, 13.
- Connecticut, 12.
- Delaware, two.
- Florida, 59.
- Georgia, 27.
- Iowa, six.
- Illinois, 37.
- Indiana, 16.
- Kansas, three.
- Kentucky, seven.
- Louisiana, seven.
- Massachusetts, 20.
- Maryland, 20.
- Maine, two.
- Michigan, 20.
- Minnesota, 10.
- Missouri, 12.
- Mississippi, one.
- North Carolina, 21.
- North Dakota, four.
- Nebraska, three.
- New Hampshire, three.
- New Jersey, 26.
- New Mexico, three.
- Nevada, five.
- New York, 46.
- Ohio, 23.
- Oklahoma, six.
- Oregon, two.
- Pennsylvania, 25.
- Rhode Island, two.
- South Carolina, 10.
- Tennessee, 14.
- Texas, 72.
- Virginia, 19.
- Vermont, one.
- Washington, 16.
- Wisconsin, 10.
- West Virginia, one.
For the record
The A&G team conducting the auction includes co-president Amendola and senior managing directors Matlat and Doug Greenspan.