Forever 21 Buys Reference Stores
Los Angeles–based retailer Forever 21 Inc. has purchased the assets of bankrupt retailer Reference Clothing Co. The company plans to convert some Reference stores into Forever 21 shops.
The purchase includes 14 Reference stores, as well as the inventory and assets from the stores and Reference’s distribution center. The deal did not include the purchase of the distribution center.
Reference has been operating under Chapter 11 bankruptcy protection since January.
Forever 21 is currently evaluating the locations of the Reference stores to determine which ones it will convert, Forever 21 Chief Financial Officer Larry Meyer said. The Reference stores are in malls in California, Florida, Pennsylvania and New Jersey. The stores each have approximately 4,500 square feet of space.
“To the extent that we can change to Forever 21, where there’s no overlap, we want to expand our brand,” he said. “Where there is overlap, where there are stores in the same malls we currently are at, we will likely retain the Reference brand.”
The conversion to Forever 21 should take about two months per store, he said.
The purchase is part of Forever 21’s ongoing growth plan. The company opens about 30 stores each year, Meyer said. This summer, Forever 21 will open five new stores in Portland, Ore.; Dayton, Ohio; Eastwood, Ohio; Chicago; and Newport Beach, Calif.
“We’re a growing company,” Meyer said. “These stores had a size and were in locations that were consistent with our retail format.”
The new stores are all located in regional shopping malls, including Fashion Island in Newport Beach. The majority of Forever 21 stores are in retail malls, but Meyer said the company is not limiting its expansion plans to mall-based locations.
“A street location in Manhattan is a freestanding location, and we are looking in some urban centers,” he said.
Not including the newly acquired stores, Forever 21 operates 153 stores in 25 states. —Alison A. Nieder
