Kalispell Herberger's facing liquidation

Nine months after the Herberger’s in Kalispell Center Mall completed a yearlong renovation, its corporate owner Bon-Ton has put the local department store on a list of 200 locations nationwide that will likely be liquidated this spring.

A hearing by a Delaware bankruptcy court to approve the sale of the corporation’s assets was set to take place Wednesday. After that, individual stores across the nation are expected to begin setting up liquidation sales. It is expected the stores will cease operations completely within three months, according to a report by CNBC.

Gary Evans, the store manager at the Kalispell Herberger’s, said Wednesday morning they were getting their information about the corporate shutdown the same way as everyone else: through the news.

He said he was trying to maintain cautious optimism, and that he expected to hear more from corporate after the bankruptcy court trial.

Evans said the store employs approximately 75 people, with the number swelling slightly in the summer months.

“We’ve got such a great group of people who work here, we still have some associates in the store who helped open the store in ’86,” Evans said. “Their attitudes [about the liquidation] are a bit what you would expect, but for the most part we still want to give the guests the shopping they want in this beautiful building.”

Kalispell Chamber president Joe Unterreiner said Wednesday he was disappointed to hear about the uncertain future of Herberger’s, “particularly coming on the heels of a major expansion of their store here.”

“This announcement adds urgency to the city of Kalispell’s work to remove the railroad tracks downtown and expand of the offerings of dining, entertainment, residential and retail space,” he added, making note of the Core Area redevelopment plan.

Elsie Holcumb had just finished shopping at the Kalispell Herberger’s store Wednesday when she heard the news of the likely store closures.

“I always loved this place,” Holcumb said. “They’ve got everything under one roof, and that’s what I like about it.”

She said she recently stopped driving, and having a large department store with many different products made it easier for her to get what she needed. She isn’t sure what she’ll do without Herberger’s.

THE IMPENDING downfall of the York, Pennsylvania-based company has been on the horizon for months. In February the corporation filed for bankruptcy and announced it was planning to close about 40 stores and was looking for investors. Most of the stores on the initial list were in the Midwest and East Coast, and none were in Montana.

Multiple reports Wednesday indicated that the scale of the store closures had increased five fold and included the locations in Kalispell, Great Falls, Havre, Billings, Missoula and Butte. That list comprises every Bon-Ton store in Montana.

“While we are disappointed by this outcome and tried very hard to identify bidders interested in operating the business as a going concern, we are committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact of this development on our associates, customers, vendors and the communities we serve,” Bon-Ton President and Chief Executive Officer Bill Tracy said in a prepared statement Wednesday. “We are incredibly grateful to all of our associates for their dedicated service to Bon-Ton and to our millions of loyal customers who we have had the pleasure to serve as their hometown store for more than 160 years.”

Liquidation firms Great American Group and Tiger Capital Group were the highest bidders for the company’s assets and no one else was willing to outbid them to continue store operations.

“I don’t think there are too many willing investors in brick and mortar stores now,” said Purush Papatla, marketing professor and interim Associate Dean of Academic Affairs at the University of Wisconsin-Milwaukee. “They’ve seen what’s going on. I think people are nervous.

“Essentially liquidators have an open field.”

The businesses The Bon-Ton has across the country sometimes serve as anchors at malls, and their departure could impact other businesses nearby with less foot traffic, Papatla said.

The corporate parent company also operates stores in other states under the names Bergner’s, Boston Store, Carson’s, Elder-Beerman and Younkers.

Reporter Peregrine Frissell can be reached at (406) 758-4438 or pfrissell@dailyinterlake.com. The Associated Press contributed to this report.