Robin Driver
Apr 23, 2018
Christopher & Banks signs agreement to sell corporate HQ, to continue on site as tenant
Robin Driver
Apr 23, 2018
Amid widening losses, Plymouth, Minnesota-based apparel retailer Christopher & Banks Corporation announced on Monday that it has signed a deal with an unaffiliated private investor group to sell and lease back its corporate headquarters for a purchase price of $13.65 million.
Christopher & Banks predicts that the net expense impact of the first year of the lease will be around $300,000. This includes rent expense, net of depreciation expense and the amortized gain on the sale
“We are pleased to announce the signing of a purchase agreement. This sale-leaseback transaction, once completed, will provide greater financial flexibility as we execute on our strategic initiatives to drive improved performance,” said Keri Jones, president and CEO of Christopher & Banks, in a release.
Faced with drops in in-store footfall and strong headwinds in the women's apparel sector, Christopher & Banks has been struggling to turn itself around in recent years and ousted former CEO LuAnn Via in January of last year, after a disappointing performance over the 2016 holiday period.
Despite a slight uptick in sales in the fourth quarter, the company reported a net loss of $22.0 million in fiscal 2017, compared to a net loss of $17.8 million in the previous year, with sales down 4.1% to $365.9 million and comps slipping 2.5%.
At the time of the annual results report, the company’s interim CEO Joel Walker cited a number of initiatives being undertaken by Christopher & Banks in order to optimize its “merchandising, marketing, eCommerce, and store operations” as the reasons behind its stronger performance in the last quarter of the year.
However, whether these strategic changes – and now the sale of the company’s corporate HQ – will be able to help Christopher & Banks achieve sustainable growth in the long term is yet to be seen.
The sale-leaseback transaction is subject to standard closing conditions.
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