Azteca Leaves Commerce Facility, Closes Mexican Factory
After being behind more than $155,000 in its rent, blue-jeans maker Azteca Production International Inc. will be moving out of its large office and warehouse in Commerce, Calif.
After serving a three-day notice on Feb. 11 to pay rent or vacate the premises, LIT Commerce Distribution Center filed a lawsuit in Los Angeles Superior Court against Azteca to try to recoup two months’ worth of rent and $2,431 a day for every day beyond those two months.
On March 14, the court issued a judgment saying that LIT was entitled to the premises.
Hubert Guez, head of Azteca, which had a blue-jeans factory in Mexico that is now closed, said he would be vacating the premises and paying his back rent. “We are moving out. We are working it out with them,” Guez said.
LIT’s attorney, David Cohen, did not return phone calls to comment on any rent reimbursement. Dee Eckman, the CB Richard Ellis property manager for the 270,222-square-foot warehouse, said she was not at liberty to disclose anything.
Azteca occupied a good portion of the warehouse. However, a little less than one-third of the property is subleased to Blue Holdings Inc., a publicly traded company that makes premium blue jeans under the labels Antik, Taverniti So Jeans, Yanuk and Faith. Blue Holdings was founded by Hubert’s brother, Paul Guez. Currently, most of the Blue Holdings staff works out of a design studio in Marina del Rey, Calif., while the finance and information-technology departments remain in Commerce.
Glenn Palmer, Blue Holdings’ chief executive, said in a recent conference call with investors that he is looking for new office space and plans to work with a 3PL or outside company to do packaging and logistics.
Paul Guez remains Blue Holdings’ chairman of the board after stepping down as chief executive last summer. Both the Guez brothers are working out of a smaller office on South Beverly Drive in Beverly Hills.
Hubert Guez said sales had decreased at Azteca, leading to the plant closing. The company had a supply agreement at one time to make private-label blue jeans for Cygne Designs Inc., a New York company that counts Hubert Guez as a major stockholder.
Cygne Designs saw its third-quarter net sales in 2007 plunge 30.5 percent to $22.8 million because of a decline in sales of private-label jeans made for Target and American Eagle Outfitters and branded jeans. Cygne’s net income for the third quarter was $707,000. —Deborah Belgum
