Forever 21 files for bankruptcy & begins ‘wind down.’ Will NC stores close?
.jpg "Crabtree mall in Raleigh is home to one of North Carolina’s Forever 21 stores.")
For the second time in six years, Forever 21 has filed for Chapter 11 bankruptcy protection, and will begin a “wind down” of operations.
The retailer will hold sales at its physical stores across the country, including in North Carolina, in addition to a court-supervised sale and marketing process for its assets, according to a press release.
This comes about a month after the company was reportedly planning to lay off more than 350 employees from its Los Angeles corporate office, which was expected to close, USA Today reported.
What will happen to Forever 21’s NC stores?
Forever 21 stores will remain open during the bankruptcy process.
However, in a note to customers published on the company’s website, Forever 21 says it will be “closing a number of stores across the U.S.” Specific stores have not been identified.
“Decisions about which stores will ultimately close are ongoing, pending further discussions with landlords and potential buyers,” the note says.
The press release indicates that the “full wind down of operations” could stop should the company find a buyer for its assets.
Forever 21, which was founded in 1984, has 10 stores in North Carolina:
- Charlotte (at Northlake Mall)
- Concord (at Concord Mills mall)
- Durham (at The Streets at Southpoint)
- Fayetteville
- Greensboro
- Jacksonville
- Pineville (at Carolina Place)
- Raleigh (at Crabtree Valley Mall)
- Wilmington
- Winston-Salem
According to Forever 21’s website, these stores are all open, as of publication. All sales in stores and online are final, and the company will honor gift cards and store credit through Tuesday, April 15.
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Why is Forever 21 winding down its business?
In the news release announcing the decision to begin bankruptcy proceedings, Forever 21 CFO Brad Sell said the company could not “find a sustainable path forward” and faced challenges from:
- “Foreign fast fashion companies” that “undercut our brand on pricing and margin” through a tariff exemption
- Rising costs of inventory, employee wages, distribution and transportation
- Economic challenges affecting Forever 21’s customers
- Changing consumer trends
“As we move through the process, we will work diligently to minimize the impact on our employees, customers, vendors and other stakeholders,” Sell said in the news release.
Forever 21’s 2019 bankruptcy
The fast fashion retailer filed for Chapter 11 bankruptcy protection in 2019 and planned to close up to nearly 180 stores in the U.S., CNBC reported. At the time, the company had 815 stores globally.
Forever 21 struggled to keep up with its customers’ changing habits. Shoppers started buying online more and favored brands with environmentally friendly practices, or purchased items secondhand.
Two of the retailer’s largest landlords at the time, Simon Property Group and Brookfield Property Partners, along with Authentic Brands Group (a brand licensing and development, marketing and entertainment company that owns media, entertainment and lifestyle brands), purchased the company.
Brookfield later sold its interest to an LLC whose primary equity holders are Simon and ABG.
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Other companies closing stores amid bankruptcy
Forever 21 is the latest national retailer with locations in North Carolina to enter bankruptcy proceedings.
- Big Lots stores closed across the country, including in the Triangle. However, North Carolina-based Variety Wholesalers is expected to keep dozens of locations in the state open. Big Lots filed for Chapter 11 bankruptcy protection in September, citing inflation, high interest rates and declining sales.
- Joann, the fabric seller, is closing all of its stores, which includes more than a dozen in North Carolina. In a news release, interim CEO Michael Prendergast said reasons behind the bankruptcy filing included “significant and lasting challenges in the retail environment” coupled with the company’s “current financial position and constrained inventory levels.”
This story was originally published March 18, 2025 at 4:59 PM with the headline "Forever 21 files for bankruptcy & begins ‘wind down.’ Will NC stores close?."
