Bad blow for retailer

Boscov’s Inc.’s decision to close its Danville department store within a few weeks could leave a huge void at Piedmont Mall.

The company announced Monday that it will file for bankruptcy and close 10 of its 49 stores.

Boscov’s spokeswoman Maralyn Lakin didn’t give a specific date for the closing of the Danville store when contacted Monday, but said it would be open for a few weeks while the company gets business in order.

On Monday, the store looked stocked, and almost every item was on sale.

The 87-year-old Reading, Pa.-based company cited current economic conditions as the primary reason for filing for Chapter 11 protection.

“The downturn in the overall economy and consumer spending along with the serious credit market crunch have put severe pressure on our company’s financial position,” Ken Lakin, chairman and CEO of Boscov’s, said in a written statement.

Depending on the time of year, the Boscov’s store in Danville employs anywhere between 130 and 150 people, store manager David Hick said Monday.

Boscov’s announced in May 2004 that it would bring a retail department store and an additional 62,000 square feet of retail space to Piedmont Mall with its two-story sales floor and third-floor storage space.

Several stores, including Victoria’s Secret, MasterCuts and Ben David Jewelers, relocated to make room for the expansion.

The department store officially opened in Danville in November 2005, making it the only Boscov’s location in the state.

Along with a slew of other stores and companies setting up shop in Danville in 2004 and 2005, the city’s economic development department offered Boscov’s an incentive package to open its doors at the Piedmont Mall.

Interim City Manager Lyle Lacy said Monday that the incentive package was to be doled out over a multi-year period that hasn’t yet been completed. Boscov’s had to pass certain benchmarks to get funds, he added.

The company had to employ 200 full-time and 100 part-time employees to get money, but never hit those numbers, Lacy said.

Economic Development Director Jeremy Stratton said he had no prior knowledge that the store was going to be closing, but had heard rumors.

“You always hate to see when you take a couple of steps forward and one step back,” Stratton said Monday.

Founded in 1911, Boscov’s describes itself as the largest family-owned, full-service U.S. department store chain, with 49 locations in Pennsylvania, Delaware, Maryland, New Jersey, New York and Virginia. It said it employs about 9,500 people and had sales of $1.25 billion in the year ended Feb. 2.

The company and seven affiliates filed for protection from creditors with the U.S. bankruptcy court in Delaware. It had $538 million of assets and $479 million of liabilities as of May 3, a court filing shows.

Contact Sarah Arkin at sarkin@registerbee.com or (434) 791-7983.