Case Studies

Toys R Us

Challenge

When Toys”R”Us, a toy, clothing, and baby product retailer, originally engaged A&G, it was to negotiate rent reductions with the landlord community as it planned to emerge from Chapter 11. A&G negotiated over $100MM before the debtor announced it would be liquidating. After that, A&G was tasked with disposing of the majority of the company’s real estate during the liquidating Chapter 11 bankruptcy case. This included about 700 of the retail locations in the United States, plus four of the eight distribution centers. Of note: 274 retail boxes were company-owned sites, the rest were leased.

Approach

A&G devised a liquidation strategy, which included multiple auctions depending on lender group collateral and property type. This resulted in six auctions from the spring to the fall of 2018 at the offices of debtor’s council, with A&G organizing and executing the auction process, acting as broker and auctioneer.

Results

A&G raised $98MM in lease sales to users, investors, and current landlords seeking control of their space. Company-owned retail box proceeds raised via auction were approximately $500MM. The four distribution centers handled by A&G sold for $233MM.