Sigel’s Beverages in Dallas Files Chapter 11 Bankruptcy

by San Antonio Attorney

Wines and spirits retailer Sigel’s Beverages filed for Chapter 11 bankruptcy on Oct.  20, saying its tenant refused to reduce the rents.

The chain was founded in Dallas 111 years ago.  Competition has increased in the past few years as more prominent retailers have been allowed to enter in North Texas.  This made previously strategic location of Sigel’s less viable, according to the company.

Sigel’s has been trying to convince its landlord to reduce its rent.  The stores are situated in Rockwall, Addison, Plano, Richardson and Dallas.

Part of its plan is to shutter two stores in Addison, two in Richardson and one in Rockwall.

Kroger, Tom Thumb and 7-eleven are the new competitions of Sigel’s.  Within the past five years, a number of wine stores have opened in Walnut Hill, Dallas to the Red River all the way to Oklahoma.

Spec’s, based in Houston, and Total Wine & More, based in Maryland, have opened their stores in Dallas within the last 5 years.  Sam’s and Costco have also boosted their alcoholic beverage selections.

The property-owner on the leases is Joe C. Thompson, who bought Sigel’s in 1987.  In 195, Sigel’s was so to Tony Bandiera, the current owner.

The chain is asking the bankruptcy court to release it from five leases, which are mostly owned by Thompson.  In a court filing, Sigel’s said the current leases were extension of contracts prior to the elections but they are now unprofitable.

It plans to reorganize about five stores that are doing well and its wholesale enterprise, according to the chain’s bankruptcy attorney.

According to Sigel’s, its reorganization not going to interrupt its normal business operations and their customers and vendors will not be affected by the bankruptcy.  The company also said, most of its vendors are supporting its decision to file and it has been negotiating with PNC bank to obtain financing for its reorganization.

 

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