ST. PETERSBURG – Brooke Taliaferro used to make regular visits to the Stein Mart on 37th Avenue N. Then came coronavirus.
Taliaferro, 76, lives just outside Parrish, but would make a weekly trip to St. Taliaferro. Take Pete to meet her sailing group. Then she would stop almost religiously at the nearby Stein Mart.
“And I would always find something great,” she said. “I find it wonderful here.”
But with COVID-19, sail meet-ups don’t happen and Taliaferro takes fewer shopping trips overall. On Wednesday, she happened to be at her favorite Stein Mart, following an appointment with a dentist in the area. To her surprise, she found newly placed signs: “ALL MUST GO” and “ALL SALE IS FINAL.” She had hoped, perhaps, that her Stein Mart would be spared one of the stores during the bankruptcy of the Jacksonville chain.
On Thursday, those hopes were dashed when the liquidators for the high-end market discount store announced that all 279 locations of Stein Mart would close. The chain had filed for bankruptcy the day before, after several attempts to keep the wrestling company alive – from securing a $ 10 million Paycheck Protection Payment loan to seeking a merger with a spin-off company.
In the end, none of that was enough.
“You have to be either the best at something like the cheapest,” said Tampa bankruptcy attorney Megan Murray. “I do not know that Stein Mart was the best at everything.”
Off-price competitors such as TJ Maxx, Marshall’s, Homegoods and Ross also had to close their doors for a stretch during the pandemic. But her shoppers came back to their open stores in masks, ready to hunt for deals. The stock prices for most off-price retailers are dancing but have since returned. TJ Maxx parent TJX fell from $ 63 per share in February to about $ 36 in mid-March. As of August 13, the price per share was at an almost pre-pandemic amount of about $ 57.
“(Stein Mart’s position) in the market was more of an older crowd,” Murray said. “They do not buy clothes because they will not work … and their generation does not go out to shops.”
Public health officials have warned those 65 and older to avoid groups, as they are more likely to die if they contract COVID-19.
Prior to the pandemic, Stein Mart was already working on a merger with a spin-off company owned by its chairman, Jay Stein, according to documents filed in the Jacksonville bankruptcy court.
But the merger fell apart in April as the pandemic forced closed stores, leaving Stein Mart without the minimum liquidity required by the deal. The same court document also said that Stein Mart unequivocally tried to find another buyer or financing before deciding to file for bankruptcy.
On June 18, Stein Mart was approved for a $ 10 million PPP loan with 1 percent interest. The loans through the Small Business Administration can be repaid if the money is used in specific ways, with the majority supporting the wage support.
It is unclear how Stein Mart used the loan money, but the bank that financed the loan is named as one of the retailers’ top 20 creditors. Other top creditors include brands such as Michael Kors and Hanes.
Murray said that as the pandemic continues, and retailers struggle to stay afloat, seeing companies register for bankruptcy shortly after getting a PPP loan will become more frequent.
“If you do not use it for qualified expenses, the damage is fairly minimal,” Murray said, unless he fraudulently spends outside business needs. “It is being converted into a loan of 1 percent (interest). It’s really cheap debt. ”
Stein Mart’s liquidators said their loyalty rewards points will be accepted for a limited time. Store fixtures, furniture and equipment will also be sold as part of the outgoing business sale. The company estimates that it will be able to make $ 250 million through its closing sale, according to court documents.
Stein Mart’s largest concentration of stores is in Florida, where it has more than 40 locations. As of February, the company has 9,000 employees. Nearly 3,000 of them were still furloughed on August 1st.
During her afternoon shopping spree, Taliaferro scored a new Queen-size comforter for $ 59.99. Most of the store was marked down only 10 percent, with a few exceptions such as men’s suits and swimsuits marked 30 percent. Taliaferro said they will continue to keep the discounts, which will likely get steeper the closer the store gets to its final days.
“I spent a lot of money here,” Taliaferro said. “But actually, I feel terrible for the staff.”
