After recently filing for bankruptcy, Forever 21 has announced the availability of its substantial real estate holdings, including around 360 store leases across major markets in the United States. This expansive portfolio encompasses approximately 7.6 million square feet of retail and includes the company’s headquarters and distribution facilities.

Current Status of Operations

Despite the bankruptcy declaration, Forever 21 continues to operate its online sales and physical stores in the United States as it begins the process of liquidating its brick-and-mortar operations and assessing its assets for sale.

Challenges Faced by Forever 21

Brad Sell, the Chief Financial Officer of Forever 21, highlighted several challenges the brand has faced: “While we have evaluated all options to best position the company for the future, we have been unable to find a sustainable path forward.” He linked the company’s struggles to competitive pressures from foreign fast-fashion retailers, rising operational costs, and changing consumer preferences. The competitive edge of these foreign brands is further bolstered by the de minimis exemption, which allows low-value imports to enter the U.S. tax-free.

Details of the Real Estate Listing

At present, RCS Real Estate Advisors has listed fewer than 100 Forever 21 lease agreements across the country, representing more than 2 million square feet of retail space. These leases differ significantly in size, ranging from smaller stores of 4,000 square feet to a large location encompassing 153,500 square feet in Riverside, California. Notably, 18 of these leases, totaling 666,846 square feet, are situated in California.

Opportunities for Retailers

Sell noted the potential for growth: “These properties offer tremendous opportunities for retailers looking to expand their footprint in key shopping destinations.”

Upcoming Lease Assignments

In addition to retail leases, RCS is marketing the lease for Forever 21’s headquarters office located in Downtown Los Angeles. This area is currently grappling with significant office space vacancies. The distribution center, located in Perris, California, spans nearly 657,000 square feet and operates under a lease with a monthly rent of $338,774 that is set to conclude in December 2029.

Recent Developments in Office Leasing

In June 2022, Forever 21 secured an office lease for roughly 164,000 square feet at the California Market Center in Downtown Los Angeles, which incurs a monthly cost of $606,198, extending until March 2034.

Conclusion and Future Direction

Spence Mehl, a partner at RCS Real Estate Advisors, remarked on the demand for prime retail locations, expressing commitment to aiding Forever 21 in maximizing the value of its leases: “With demand for high-traffic retail space remaining strong, this portfolio represents a significant opportunity for growth-minded brands.”

Forever 21 was acquired by SPARC Group—comprising Brookfield, Simon Property Group, and Authentic Brands—in 2020 after the company previously experienced bankruptcy.