LOMBARD, Ill. — Documents in the Chapter 11 bankruptcy case involving Top 100 retailer The RoomPlace and TRP Brands indicate that plans have expanded beyond its previously closed stores.
A document filed Sept. 4 with the U.S. Bankruptcy Court for the Northern District of Illinois reports that the Lombard, Ill.-based retailer is seeking court approval to self-manage store closings at its remaining stores. A hearing is scheduled for Sept. 20 at 10 a.m. Central to approve the motion.
The RoomPlace revealed plans to close eight stores earlier this year after it initiated the bankruptcy proceedings. Six of those stores were in the Indianapolis market, one was in Kenosha, Wis., and another in Peoria, Ill. According to its website, it currently has 18 stores, all in the greater Chicago market.
According to the motion, in July the court approved an auction for the sale of all, or substantially all, of the debtors’ assets. Two bidders participated in the auction seeking to enter consulting agreements whereby they would liquidate the debtors’ assets, but ultimately, the auction was concluded on Aug. 20 as the debtors and constituent parties decided that none of the submitted bids were acceptable. The sale motion was concluded on Aug. 29.
As a result, the debtors are seeking to maximize the value of their assets by conducting their own store closing sales at their remaining stores. Additionally, the debtors are seeking authorization to sell the store closing assets free and clear of liens, claims and encumbrances.
In the documents, the company noted that the furniture industry is facing a difficult economic climate with high interest rates and inflation impacting consumer spending on home goods. The housing market slowdown after the post-pandemic buying boom — fueled by soaring mortgage interest rates which hit a 23-year high in October 2023 — further compounded the challenges.
As a result, the debtors have also struggled to operate profitably and have been experiencing cash burn higher than anticipated and need to deal with liquidity problems. They say the store closing sales need to be commenced before they exhaust resources.
Furniture Today has reached out to The Roomplace, representatives of the case’s trustees and representatives of the creditor committee.