Bankrupt retailer's leases scooped up by popular chain

Shoppers can look forward to a well-liked retailer’s expansion.

May 2, 2025 - 17:41

Bankrupt retailer's leases scooped up by popular chain

The past few years have been exceptionally tough on retailers.

The pandemic was brutal for businesses that relied on in-person shoppers to generate sales. Big box stores came out okay in 2020 when the country shut down. But a number of chains lost out on so much revenue they couldn't quite recover.

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Once society opened back up, retailers were almost immediately hit with supply chain bottlenecks. And when that situation settled, inflation started to soar.

Unfortunately, inflation hasn't really returned to pre-pandemic levels. It's gotten closer in recent months, but consumers are still paying a premium for just about everything, whether it's groceries, rent, or utilities.

When money is tight, specialty retailers tend to lose business. Consumers can't prioritize fun purchases or hobbies when they're barely managing their bills.

*Popular chain snags bankruptcy retailer's leases.*
Image source: Shutterstock

Joann just couldn't hang on

Crafts giant Joann has seen its share of financial struggles in recent years. The company filed for bankruptcy in March 2024 and secured financing at the time to stay afloat.

Following that Chapter 11 filing, things were looking up. Joann said it would forge forward and keep its stores open.

But that didn't last long. In January 2025, Joann filed for bankruptcy a second time. The company blamed its relapse on poor sales, issues procuring inventory, and a generally challenging economic environment.

Competition from retailers like Michaels and Hobby Lobby didn't help, either. Nor did Joann's significant debt.

Following its second bankruptcy filing, Joann announced plans to shutter all of its nearly 800 stores across the U.S. That dealt customers a major blow, but it also opened the door for other retailers to bid on Joann's leases and take over those empty stores.

Burlington nabs Joann leases

They say that when one door closes, another one opens. In this case, Burlington is taking advantage of Joann's closures by scooping up some of its store leases.

As part of the bankruptcy process, Burlington will assume the leases of 45 Joann locations and take over in May and June. Those leases span a number of states, including Georgia, California, and Texas.

For Burlington, Joann’s decision to shutter could not have come at a better time. Retail center growth has stalled due to factors that include high construction costs.

Meanwhile, Burlington is implementing a growth strategy that has it expanding its overall footprint. It can be far more cost-effective for retailers in that position to take over bankrupt companies’ leases than to secure space from scratch.

In fact, it won’t be surprising to see Burlington continue to lease-shop this year as it seeks to open more locations.

In March, CEO Michael O’Sullivan said the company opened 101 net new stores in 2024 and relocated 31 older locations. During the company's fourth quarter, net sales soared almost 5% year over year, and net income rose substantially.

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At a time when inflation is still a problem, consumers tend to flock to off-price retailers for the potential savings involved. Burlington is poised to take advantage of economic uncertainty and attract customers who perhaps wouldn’t normally be inclined to shop at a budget retailer.

Burlington also isn't the only company taking over Joann's leases. Hobby Lobby will be occupying some of those locations, as will Boot Barn.