Once the embodiment of aspirational, New York consumerism, the luxury retailer has announced nationwide store closures
Legend has it that Barney Pressman founded his modest discount men’s clothing store in Chelsea by pawning his wife’s engagement ring in 1923. Originally just 500 square feet, Barneys’ trajectory into the luxury market in the ՚60s and nationwide expansion in the ՚90s was a stunning example of that mythological, bootstraps-pulling American dream. Its 230,000-square-foot, nine story Madison Avenue location opened in 1993—positioned in fashion history between Anna Wintour’s coronation at Vogue (1988) and the premier of Sex and the City (1998)—and is a sparkling embodiment of aspirational, New York consumerism.
But the way we consume has changed, and luxury retailers are not immune. Though Barneys attempted to compete with online retailers like Net-a-Porter and Moda Operandi by increasing its web sales from roughly $18 million to $200 million, Barneys CEO, Daniella Vitale, has been searching for a buyer. Unsuccessful, today, Barneys filed for bankruptcy, announcing it will close 15 store locations, seven warehouses, and five concept stores. Madison Avenue, Downtown New York City, Beverly Hills, San Francisco, and Boston will remain open, and the company’s e-commerce sites will remain active.
As Vitale commented, “Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand.” When it comes to New York real estate, Jimmy McMillan is always correct: the rent for Barneys Madison Avenue location nearly doubled to $30 million from $16 million last January. The unpaid rent tally is currently at about $10 million.
American consumer habits no longer pay the rent for juggernaut department stores, if the death of the American mall and this running list of major retailers in financial distress are any indication. Physical retailers have attempted to lure customers from their computer screens with VR spectacles, promises of personal styling, and indoor ski slopes. Earlier this year, Barneys Beverly Hills opened a supremely bourgie head shop, “The High End,” which sells items like an $8,000 gift set from Devambez that includes “rolling papers and accessories, with a solid gold rolling tray, and a gold tamper that has the shape of the queen’s scepter.” While artisanal weed paraphernalia fit for a Charlotte York did not save the iconic retailer from bankruptcy, we’ll take this attempt at maintaining relevance over shawarma-shaped staircases any day.