Stores at DeSoto Square, Ellenton outlets and Port Charlotte remain open.
The Mall at University Town Center will lose its Charlotte Russe store as a result of a corporate bankruptcy filing by the young women’s clothing and accessories retailer.
Merchandise was still well-stocked Friday afternoon at the University Town Center store, which is on the mall’s upper level near Dillard’s, however, signs saying all items were marked down by 25 to 40 percent were hanging behind the front display glass and throughout the store.
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The retailer announced this week that it voluntarily filed for Chapter 11 bankruptcy and plans to close about 94 stores, including its only Sarasota location. Charlotte Russe also has stores in the DeSoto Square Mall in Bradenton, at the Ellenton Premium Outlets and in Port Charlotte Town Center, all three of which were spared. The company also had a store at Westfield Sarasota Square mall that closed last year.
San Diego-based Charlotte Russe is known for selling clothing, accessories and shoes to women in their teens and 20s. Its target demographic is similar to Forever 21’s and H&M’s, but with a slightly higher price point, said Stan Rutstein, a Manatee County-based commercial real estate broker with years of experience in the retail industry. The company has more than 500 brick-and-mortar stores, mostly in malls and outlet centers, according to a news release.
The company’s gross sales fell from $928 million in fiscal year 2017 to an estimated $795.5 million in fiscal year 2018, according to bankruptcy court documents. Although Charlotte Russe did try to make some operational changes, the company failed to stay on pace with evolving fashion trends and with e-commerce and social media strategy, according to court filings. The company also shifted too far toward fashion basics, and in the future plans to shift toward an on-trend, fast-fashion model, improve customer engagement online and on social media, stabilize its e-commerce offerings and rationalize its store fleet, documents say.
Charlotte Russe has between $100 million and $500 million in estimated assets and the same in estimated liabilities, according to court documents.
“We aren’t surprised by Charlotte Russe’s plans to file for bankruptcy; As the brand mentioned, it’s had some challenges keeping up with fashion trends and other issues,” Lauren Clark, marketing and sponsorship director for the Mall at University Town Center, said. “We haven’t received anything formal regarding their plans for the UTC location yet, only the initial announcement of their plans.”
The company is another victim of changing consumer spending and shopping patterns, Rutstein said. He said the days of people going to malls and shopping at one specialty store and then another for a weekend outfit reflecting the “look of the season” are over.
“Fashion is not their No. 1 interest or category, and if it is, the clientele for that type of store either is shopping online or they’re shopping at what is considered to be an off-price store, such as T.J. Maxx, Marshalls or Burlington. They’re very value and price-conscious,” he said. “We no longer are living in the world of fashion trends that you have to have. In addition to all of that, mall traffic is off dramatically, and its going to get worse. Most malls today not of [top] quality are struggling horribly for traffic.”
People are far more interested in having the latest cellphone or tablet than they are in getting a new outfit to wear for the weekend, Rutstein said. Clothes aren’t associated with having status, like they used to be. Many women wear “athleisure” wear from places like Lululemon to work, he said.
“If we go back 40-50 years ago, we dressed to adorn ourselves, to show the world that we’ve ‘made it,'” Rutstein said. “When you shopped, the way you looked was your status in life. Today, it really doesn’t matter.”
Since the Mall at University Town Center opened in 2014, several stores have left due to corporate closures and bankruptcies, including Brookstone, Calypso St. Barth, Teavana, Camicissima, Boston Proper and Cache.