NEW YORK--(BUSINESS WIRE)--The nation’s largest bookstore chain, Barnes & Noble, is in the process of reevaluating its business model, according to various media and company sources, after its stock price fell to a 24-year low in early March 2018. The development comes on the heels of 87 net store closures between 2010 and 2017, deteriorating same store sales in four of the last five years and a disappointing 2017 holiday season, as documented in Barnes and Noble’s annual investor reports. In February 2018, the company appointed a new chief merchandising officer and announced a round of layoffs aimed at saving the company $40 million annually. The company appointed a new CEO in April 2018, its fourth in so many years, and communicated its strategy for “smaller stores that are more efficient”. Store closures could be forthcoming as the company looks to optimize its real estate footprint and shed unproductive locations.
KBRA Credit Profile (KCP) examined its $560 billion coverage universe of over 870 transactions to identify CMBS exposure to the struggling book retailer. There are 152 loans secured by 155 properties, $13.3 billion by allocated loan amount (ALA), with exposure to Barnes & Noble as either a collateral or non-collateral/shadow tenant. A loan list featuring exposure to properties with Barnes & Noble as a tenant can be found here. Additional information on deals that are exposed to Barnes & Noble can be found in our KCP report for each transaction.
The KCP platform is a subscription-based surveillance service that covers over 870 commercial real estate (CRE) securitizations with an aggregate balance of approximately $560 billion. For each deal, monthly reports are posted to our website that contain color and commentary for CMBS transactions and their underlying loan collateral. Unlike other sources of valuation and loss data, which primarily rely on models, the service is supported by a dedicated team of analysts, who can more readily appreciate the non-homogeneous nature of CRE, loan, and transaction structures, as well as imperfect servicer information.
To read the report, please click here.
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KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.