UPDATE: February 3, 2020: According to an Ascena spokesperson: "The sale of the company's office complex in Mahwah, New Jersey is another step in our efforts to right size our footprint and cost structure to support a stronger, focused, and more profitable business. In the event the company receives an attractive offer for the office complex, we intend to explore office locations in the local New Jersey area to relocate our associates."
Ascena Retail Group has hired a commercial real estate firm that is conducting tours of its Mahwah, New Jersey, headquarters in hopes of a sale, according to a press release from the firm, Binswanger.
The company's complex includes 195,212 total square feet of office space in two buildings on 20 acres, according to the release.
The company headquarters was on the market a couple of weeks after its shares regained compliance with the minimum bid price requirement of the Nasdaq Global Select Market.
In an extremely difficult apparel market, along with shifts in plus size clothing sales that are hurting two of its stalwarts, Ascena has entered a new year with many of the same problems it struggled with last year.
The company has made several moves to correct. In 2019, the conglomerate scrambled to stem falling sales across its apparel brands with a C-suite shakeup including the departure of the founder's son as CEO and the arrival of a new CFO, and took a critical look at its portfolio, which included the sale of a majority stake in discounter Maurices and its entire Dressbarn brand (closing all locations), and reportedly the mulling of a sale of its plus brands.
But late in the year, Ascena's credit rating was downgraded by S&P Global based on what analysts saw as an "elevated risk" of the retailer pursuing a debt restructuring deal. The company appeared on Retail Dive's recent assessment of possible bankruptcy filings, landing on various lists of retailers under siege, including those with a "high chance" of bankruptcy, according to CreditRiskMonitor and on Fitch's list of "loans of concern," amid mounting losses, a precarious share price and reported scuffles with lenders (which the company has disputed). Ascena shares are on the downswing again after a reverse stock split in December rescued them from delisting.
The company's new leadership in October said that bankruptcy was off the table, however, and announced a shift in strategy. Ascena is now focusing more on each banner individually than it did previously. "In the past, we placed too much emphasis on building a platform, but we have fundamentally changed our approach with a heightened focus on maximizing the potential of each of our brands," CEO Gary Muto told analysts during the company's fourth quarter conference call.