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RoomStore furniture showroom near Hagerstown to close Jan. 25

January 13, 2012|By DAN DEARTH | dan.dearth@herald-mail.com
  • The RoomStore furniture showroom near Hagerstown will close its doors for good Jan. 25, a little more than a month after the company announced it was filing for Chapter 11 bankruptcy protection in federal court.
By Ric Dugan/Staff Photographer

The RoomStore furniture showroom near Hagerstown will close its doors for good Jan. 25, a little more than a month after the company announced it was filing for Chapter 11 bankruptcy protection in federal court.

Stephen Giordano, president and chief executive officer of RoomStore, said logistics played an important role in the decision to close the store at 17159 Cole Road southwest of Hagerstown. He said the store was too far away from its warehouse in North Carolina.

"It was difficult to service our customers that far out," Giordano said Friday in a telephone interview. "Hagerstown just didn't make the cut."

He said the high cost to lease the building also was a factor.

Giordano said the RoomStore on Cole Road was one of three in Maryland and 26 across the nation that company officials chose to close. Thirty-seven stores will remain open.

"We're going to move forward," said Giordano.

The Washington County RoomStore employed five people, he said.

RoomStore will continue to honor manufacturer's warranties and other commitments on furniture that was purchased locally, he said.

"I want to make that clear," Giordano said.

Signs that said, "Store Closing," "Everything Must Go," Liquidation Sale" and "Nothing Held Back" were posted Friday on the windows of the store, which sits between the Kohl's and Target department stores near Valley Mall.

Much of the furniture on the showroom floor had been picked over, but a number of pieces remained.

"We got the official close date on Wednesday ... that this store will close on the 25th," RoomStore employee Cliff Boyer said Friday.

Boyer said everything in the store was being sold at a 70 percent discount from Friday until Monday. He said the discount probably would be reduced to 50 percent after then.

RoomStore spokeswoman Lisa Brock told The Herald-Mail in December that the showroom near Hagerstown opened in March 2009. She said at the time that RoomStore officials had not decided which stores they would close.

RoomStore listed about $56 million in assets and more than $52 million in debts in its court filings, The Associated Press reported in December.

The company claimed a net loss of $7.7 million for the first six months of the fiscal year, compared with a loss of $2.4 million in the same period in 2010, according to The AP.

Last year, RoomStore secured a commitment from Wells Fargo Bank, its current lender, for a further $14 million line of credit called a "debtor-in-possession credit facility," according to a RoomStore news release in December.

"The restructuring process will facilitate RoomStore's financial and operational plans, which are designed to restore the company to long-term financial health," the release said.

RoomStore, which began in 1992 in Dallas, operated stores in Maryland, Alabama, Florida, North Carolina, Pennsylvania, South Carolina, Texas and Virginia.

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