3.2.16: Sports Authority Files for Bankruptcy

About one-third of Sports Authority stores will be shut down or sold as the company filed for bankruptcy, the company announced Wednesday morning. Sports Authority plans to close about 140 of its 463 stores over the next three months as it seeks a buyer. Distribution centers in Denver and Chicago will also close. About 3,400 of its 15,000 employees are expected to be laid off, according to DenverPost.com.

Once the nation’s largest sporting goods retailer, Sports Authority has been passed by Dick’s Sporting Goods, which offers a higher-end shopping experience. Online retailers such as Amazon as well as websites run by college and professional teams and leagues have also taken a big bite out Sports Authority’s sales. It’s now the fourth-largest retailer in the United States.

The company, which has stores in 41 states, has announced the stores that are on the chopping block. The list includes 25 stores in Texas, 19 in California, 18 in Florida and 11 in Illinois. The remaining stores could also close if the company doesn’t meet the conditions of its bankruptcy, according to the Wall Street Journal.

Trepp has identified 34 CMBS loans with exposure to Sports Authority tenants. Many loans are part of larger multi-tenant retail portfolios in which Sports Authority is not the largest source of income. However a few loans have Sports Authority as the major or sole tenant, including the Sports Authority – Virginia Beach loan and the Sports Authority – Tampa loan. Both of these loans are secured by a roughly 40,000-square-foot free-standing store that would need to be re-let to another tenant, unless the lease is picked up by another retailer through the bankruptcy.

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This entry was posted in CMBS Conduit Loans, Commercial Lending, Commercial Real Estate Loans, Michael D. Sneden, News & Recent Closings, The Banker's Mortgage Conduit, Valuexpress and tagged , . Bookmark the permalink.

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