Popular bankrupt home goods chain cancels store closings

The retail sector has suffered through economic distress over the last three years as a combination of financial issues derailed many retailers' business plans.

Rising inflation has driven up costs of everything from employee salaries to products on retailers' shelves. Over the last three years, increased interest rates have spiked the costs of retail companies' debt obligations.

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Retail chains also face lease obligations that may no longer make economic sense as consumers continue to shift their buying habits from brick-and-mortar shopping to online purchases.

National drugstore chain Rite Aid, which filed for Chapter 11 bankruptcy a second time on May 5, 2025, is entering the final months of its existence, as each week, the bankrupt retailer files store closing notices with the bankruptcy court, designating locations for closure.

Several other iconic retail chains have also filed for bankruptcy over the last two years, closing hundreds of stores and, in some cases, going out of business, including Forever 21, Joann, Big Lots, and Party City.

At Home filed for Chapter 11 bankruptcy

Popular bankrupt home goods retail chain At Home Group Inc. filed for Chapter 11 protection on June 16, with a restructuring support agreement that will eliminate $1.62 billion in debt and hand ownership to its prepetition lenders.

The home decor retailer filed its petition listing $1 billion to $10 billion in assets and liabilities, which include $1.998 billion in noteholder debt, consisting of $1.94 billion in secured note debt and $58 million in senior unsecured notes.

The debtor's largest unsecured creditors include US Bank NA, owed $58 million; Brentwood Originals, owed about $5.8 million; and Yotrio Corp, owed $3.8 million.

At Home faced financial and operational headwinds in recent years that included increased freight rates driven by rising inflation, softening demand in the home decor market, and a consumer shift away from brick-and-mortar shopping with an increased focus on online purchases, according to a declaration from Chief Financial Officer Jeremy Aguilar.

The company, founded in 1979 as Garden Ridge Pottery, began out-of-court restructuring efforts in early 2025 at a time when tariffs began rising for its many foreign suppliers.

After considering strategic alternatives, the company negotiated a restructuring support agreement with its prepetition lenders before filing for bankruptcy and seeking a $600 million debtor-in-possession financing transaction, which includes $200 million in new money.

Under its plan, the company said it would close 26 underperforming store locations across the country as part of its reorganization.

At Home is cancelling plans to close two of its store locations.

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At Home cancels plans to shut two locations

And now, At Home has cancelled plans to close two store locations that were originally on its list of 26 initial closing stores when it filed for Chapter 11 bankruptcy.

At Home filed a notice of removal of closing stores from the store closing list on July 15, declaring that it was removing its stores in Princeton, N.J., and Wauwatosa, Wis., from the list and ceasing store closing sales at those locations.

More bankruptcy

The debtor did not indicate reasons for cancelling the store-closing sales.

The home goods retailer had included the stores on its list of 26 stores to close, or 10% of its 260 locations in 40 states, during its bankruptcy case. The retailer had already closed six stores in the 12 months preceding its bankruptcy filing, according to the debtor's motion to conduct store closing sales.

The company employed about 7,170 employees when it filed for bankruptcy protection.

The 24 stores designated for closing in its bankruptcy are located in California (8), Illinois (2), Massachusetts (2), New Jersey, (2), New York (2), Virginia (2), Washington (2), Florida (1), Minnesota (1), Montana (1), and Pennsylvania (1).

The company expects to complete the store closings by Sept. 30, 2025.