Suburbs, Chicago take biggest Borders hit
The suburbs and Chicago will be hit hard when Borders starts closing stores in the next few weeks.
Borders announced Wednesday it was filing for Chapter 11 bankruptcy protection and closing about 200 of its 642 stores nationwide.
Fifteen of those stores are in Illinois, with eight in the suburbs and five in Chicago. That will leave only eight stores open in the suburbs and three in Chicago.
The stores slated to close in the suburbs are in Mount Prospect, Crystal Lake, St. Charles, McHenry, Bolingbrook, Deerfield, Evanston, Norridge and south suburban Matteson. Stores in DeKalb and Normal are also closing.
The closings nationwide are expected to eliminate 6,000 of Borders' 19,500 employees.
Borders officials did not return calls Wednesday night seeking an estimate of how many jobs will be lost in the suburbs. Suburban employees at the stores on the closed list directed all comments to a Borders corporate spokesman.
A note on the Deerfield store's website acknowledged the store is closing soon.
“This store is expected to close no later than the end of April,” the note reads. “We've enjoyed serving the many customers who have shopped this store over the years.”
The suburban stores that will remain open are breathing a sigh of relief and appear to be expecting normal operations.
“The Borders in Naperville is a popular location with our guests. We are remaining open and will continue to service our guests,” said Kevin Arce, general manager at the store on Route 59.
“We're definitely not going anywhere, I'm happy to say,” said John Conger, general manager of Borders' Oak Brook location. “It's a pretty busy store.”
In addition to Naperville and Oak Brook, stores will stay open in Algonquin, Geneva, Gurnee, Schaumburg, Wheaton and Wilmette.
The closings will hit suburban locations particularly hard. Losing the store in St. Charles adds yet another economic blow to a commercial section of the city that already has a suffering shopping mall across the street.
The news comes only one month after Sears announced it would leave Charlestowne Mall. The city also recently learned of a $2 million gouging of its revenue stream when the former St. Charles Countryside Fire Protection District ended its emergency services contract with the city.
St. Charles Economic Development Director Chris Aiston did not immediately respond to a request for comment.
Another mall, Randhurst Village in Mount Prospect, is in the midst of extensive renovations, so officials there aren't worried too much about losing tax revenue from the store.
“Randhurst is going through this redevelopment and it's a very visible spot,” said Mount Prospect Mayor Irvana Wilks said. “Someone will see that as a great opportunity.”
Still, Wilks says, losing Borders will leave a hole in the community. “The lattes were excellent,” she said. “Many times I would stop in on a Saturday afternoon. The parking lot was always full. It was a real gathering spot for our community.”
The decision to close one store over another was easy for the company, said John Melaniphy, who analyzes retail and shopping trends with John Melaniphy & Associates in Chicago.
“It's about money and sales and that's it,” said Melaniphy, who has been following Border's decline. “When it comes to bankruptcy, the stores that are profitable stay open. The ones that aren't close. It's simple.”
Borders said it is losing about $2 million a day at the stores it plans to close.
Clearance sales could begin as early as this weekend, according to documents filed with the U.S. Bankruptcy Court in New York.
Borders plans to operate normally and honor gift cards and its loyalty program as it reorganizes, executives said.
The filing Wednesday was expected, but it is far from clear if it will be enough to save the company.
According to the Chapter 11 filing, Borders had $1.28 billion in assets and $1.29 billion in debts as of Dec. 25.
It owes tens of millions of dollars to publishers, including $41.1 million to Penguin Putnam, $36.9 million to Hachette Book Group, $33.8 million to Simon & Schuster and $33.5 million to Random House.
It's significant that Borders could not reach an agreement with creditors and file a “prepackaged bankruptcy.” Said Nejat Seyhun, a bankruptcy expert at the University of Michigan.
It could be a sign that creditors do not believe Borders will be a “viable operation going forward,” Seyhun said.
It has been a long fall for the Ann Arbor, Mich., company, which 15 years ago appeared to be the future of bookselling.
Big-box bookstores have struggled as competition has become increasingly tough, with books becoming available in more locations from Costco to Walmart, online sales growing and electronic books gaining in popularity.
At its peak in 2003, Borders operated 1,249 Borders and Waldenbooks stores. Now it operates barely half that. Its annual revenue has fallen by about $1 billion since 2006, the last year it reported a profit.
• Daily Herald news services and staff writers Sheila Ahern, James Fuller, Marie Wilson, Justin Kmitch, Bob Susnjara and Russell Lissau contributed to this report.
Stores closing in our area
Ÿ Deerfield, 49 S Waukegan Road
Ÿ Evanston, 1700 Maple Avenue
Ÿ Crystal Lake, 6000 Northwestern Highway
Ÿ Mount Prospect, 909 North Elmhurst Rd
Ÿ St. Charles. 3539 E Main
Ÿ Bolingbrook, 161 N. Webber
Ÿ Norridge, 7100 W. Forest Preserve Drive
Ÿ DeKalb, 2520 Sycamore Road
Ÿ McHenry, 2221 Richmond Road
Ÿ Matteson, 4824 West 211th Street
Ÿ 5 stores in Chicago: 2817 North Clark Street, 2210 W. 95th Street, 6103 N. Lincoln Avenue, 4718 N. Broadway Ave., 755 W. North Avenue
Ÿ Downstate: Normal
Stores staying open
Ÿ Algonquin, 2216 S. Randall Road
Ÿ Geneva, 1660 S. Randall Road Ÿ Gurnee, 6971 West Grand Ave.
Ÿ Naperville, 336 South Route 59
Ÿ Oak Brook, 1500 16th Street, Suite D
Ÿ Schaumburg, 1540 Golf Road
Ÿ Wheaton, 101 Rice Lake Square
Ÿ Wilmette, 3232 Lake Avenue, Suite 100