Payless Bankruptcy Hits Retail Bondholders Hard

April 6, 2017

The chapter 11 bankruptcy filing by Payless ShoeSource this week pushed Fitch Ratings’ U.S. retail default rate higher, as the sector marches towards $6 billion of defaults this year. The Topeka, KS-based footwear retailer’s announced closing of 400 of its 4,400 stores immediately is the latest blow to retail bondholders.

Fitch said the retail sector’s trailing 12-month loan default rate climbed to 1% in April, from 0% in March and 0.5% at the end of February. The rate is expected to spike to 9% by year-end as a result of continued challenges from reduced traffic, smaller margins caused by steep discounting and e-commerce giant Amazon.com.

Payless was one of nine retailers on Fitch’s “Loans of Concern” list. Others included Sears Holding Corp., 99 Cents Only Stores LLC, Charming Charlie LLC, Gymboree Corp., Nine West Holdings Inc., NYDJ Apparel LLC, rue21, Inc. and True Religion Apparel Inc.

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Dennis Kaiser is Vice President of Public Relations and Communications for Connect Creative. Dennis is a communications leader with more than 40 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect Creative’s agency client services and is involved in a range of initiatives ranging from public relations and content strategy, communications and message development, copywriting, media relations, social media and content marketing services. Prior to joining Connect Media in 2015, his most recent corporate communications roles involved leading a regional public relations effort across Southern California for CBRE, playing a key marketing role on JLL’s national retail team, and directing the global public relations effort at ValleyCrest (BrightView), the nation’s largest commercial landscape services company. He has worked on marketing communications assignments for such CRE companies as Blackstone/Equity Office, Carlyle, Caruso, Disney Resorts, GE Capital, Irvine Company, Hines, Howard Hughes Corp., Jeffries, Lennar, MGM, Marcus & Millichap, Prologis, Raleigh Studios, Simon, Starwood, Trammell Crow Company, Transamerica, UBS and Wynn Resorts. Dennis has also worked on communications and launch strategies for a number of consumer electronic, media and tech brands including SlingMedia, Channel Master, Deluxe Media Entertainment, BeIn Sports, EchoStar and Sprint. Dennis’s agency background included firms such as Off Madison Ave., Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator. Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements. Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, Boy Scouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and the Thunderbirds Charities.

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Payless Bankruptcy Hits Retail Bondholders Hard

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