Sale of Gottschalks’ SLO location OK’d by judge

Forever 21, retailer specializing in clothes for young women, to pay $8.5 million

By Tim Sheehan | The Fresno Bee

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A bankruptcy judge in Delaware cleared the way Wednesday for women’s clothing retailer Forever 21 to take over the Gottschalks store property in San Luis Obispo.

The judge approved Forever 21 and department store Macy’s taking possession of 16 Gottschalks store locations throughout California as part of the chain’s bankruptcy plan.

Gottschalks chief executive Jim Famalette confirmed that the federal judge approved the deals.

Forever 21, a growing company whose stores primarily target younger women, was approved in its purchase of property Gottschalks owns in the San Luis Obispo Promenade, at the Hanford Mall and in Yuba City. The firm was also cleared to take over leases at a dozen other store locations in California, Washington and Alaska.

The company will pay Gottschalks $8.5 million for the San Luis Obispo store — the most expensive single property Forever 21 is purchasing.

According to information in court documents, the sale of property and leases will fetch about $19 million for Gottschalks, the 105-year-old Fresno retail chain that filed for bankruptcy protection in mid-January.

The sales could close by late this week, according to court records. It’s unclear when Forever 21 or Macy’s would reopen in any of the locations because liquidators are still holding going-out-of-business sales at most of Gottschalks’ 58 stores to clear out merchandise, fixtures and equipment.

Those sales are supposed to be completed by mid-July.

Besides San Luis Obispo, Forever 21 will take over Gottschalks locations in Chico, Fresno, Sacramento, Modesto, Yuba City, Bakersfield, Davis, Riverside and Hemet; and in Anchorage, Alaska, and Union Gap, Wash.

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