Bankrupt Circuit City Stores Inc., the nation’s second-biggest consumer electronics retailer, said today it failed to find a buyer and will liquidate its 567 U.S. stores, including its Mall of Louisiana location. The closures could send another 30,000 people into the ranks of the unemployed. “This is the only possible path for our company,” James A. Marcum, acting chief executive, said in a statement. “We are extremely disappointed by this outcome.” The company had been seeking a buyer or a deal to refinance its debt, but the hobbled credit market and consumer worries proved insurmountable.
Circuit City shut down its Airline Highway location at the end of 2008. The Mall of Louisiana store has only been open since the summer. The chain also has locations in Covington, Metairie, Harvey, Houma, Lafayette, Alexandria, Lake Charles and Shreveport. Employees were being notified today that they would lose their jobs and, if a judge gives final approval to the liquidation, stores would begin closing sales Saturday. The liquidation is the latest big blow to the nation’s malls, which have suffered from a rise in vacancies as a slew of chains from Mervyns LLC to Linens ‘N Things have liquidated. But analysts say that the demise of Circuit City, whose stores range in size from 20,000 to 25,000 square feet, will hurt the fortunes of mall operators even more.
“It will bring to market a glut of big-box spaces across the country,” said John Bemis, head of Jones Lang LaSalle Inc.’s retail leasing team. “It will have one of the largest impacts on big-box real estate across the country.”