Private equity firm angling to reopen some former Art Van stores
Less than two months after Metro Detroit-based furniture retailer Art Van Furniture Inc. laid off its employees and shuttered its stories amid a bankruptcy filing, some former Art Van stores in Michigan may reopen under the ownership of a Texas-based private equity firm.
That's according to a purchase agreement filed last week in the retailer's Chapter 7 bankruptcy case in Delaware, which was later signed off on by the court.
The agreement, dated May 4, is between Art Van's court-appointed bankruptcy trustee and U.S. Realty Acquisitions LLC. The agreement was signed on behalf of U.S. Realty Acquisitions by Jeffrey Love, who is listed as the chief executive officer of Dallas-based US Assets Inc., which according to its website is an investment firm that "typically invests in the lower and middle markets with companies."
The purchase agreement includes 27 leased facilities, 17 of which are in Michigan. The other stores are in Illinois, Ohio, Pennsylvania and Virginia. To purchase the inventory and assets associated with those facilities, the purchaser agreed to pay approximately $6.9 million, according to court documents.
The Michigan facilities are located in:
- Royal Oak
- Bay City
- Shelby Township
- Port Huron
- Ann Arbor
- Battle Creek
The Detroit News reported in early March that Art Van, which at the time was one of the largest furniture retailers in the Midwest, would close all of its company-owned stores and liquidate its inventory. Three days after it launched liquidation sales at most of its 190 stores, Art Van filed for Chapter 11 bankruptcy (which was later converted to Chapter 7).
Then, on March 20, the retailer laid off nearly all of its employees after suspending all sales operations amid the coronavirus pandemic.
The furniture and mattress retailer, which was headquartered in Warren, was founded with one store in 1959 by Art Van Elslander. At the time of its closure, Art Van employed some 3,100 people in nine states.
In addition to its main stores, Art Van also operated Art Van PureSleep, Art Van Flooring, Scott Shuptrine Interiors, Levin Furniture, Levin Mattress, Wolf Furniture and Gardiner Wolf Furniture, The News reported. All but the Levin and Wolf stores were slated to close.
The bankruptcy filing and closure came on the heels of the Van Elslander family selling the chain to Boston-based private equity firm Thomas H. Lee Partners in 2017 for $500 million. Art Van Elslander died soon after, in February 2018.
The shuttering of Art Van upset many Metro Detroit customers, as well as Warren Mayor Jim Fouts, who previously said the chain's demise was due to "investment greed."
In court documents tied to the bankruptcy filing, Art Van executives pointed to "continuously declining profitability," recent "operational challenges" and "increased fragmentation and intense competition" in the industry.
The News on Monday attempted to contact a former Art Van spokesperson, the Van Elslander family, Thomas H. Lee Partners, and US Assets, but did not hear back by deadline.
On Facebook, US Assets announced last month that a furniture chain called Loves Furniture was "coming very soon."