Officials already taking stock of redeveloping CityCenter Englewood as 775 workers nearby likely will disappear
As Sports Authority abandons reorganization attempts and pursues the liquidation of its assets, the city of Englewood has already begun girding itself for the loss of what was once its second-largest employer.The retailer's corporate headquarters have been in the Denver suburb since its 2003 merger with Gart Sports, which had been there since the fall of 2001.
Sports Authority had 2,400 employees in Colorado, 772 of them at Englewood corporate headquarters, when it filed for bankruptcy protection in March, company officials said at the time. An earlier round of layoffs in January cut the local workforce by 100, mostly from its corporate offices.
And while it's possible some of the chain's remaining stores may be snapped up at a bankruptcy auction by competitors, Sports Authority will cease to exist as the independent company in need of headquarters that it is today.
"This is a terrible blow to our community," Englewood city manager Eric Keck said Wednesday. "Whenever you lose a primary employer, it has ripple effects throughout the business community. The loss of that daytime population is going to have an impact."
Through Chapter 11 proceedings, the sporting goods chain had hoped to rework its $1.1 billion in outstanding debt and emerge leaner but more competitive.
But on Tuesday, company attorney Robert Klyman told a bankruptcy judge that creditors had made reorganization impossible and that the company would now pursue a sale of its assets.
Keck said city officials have already reached out to the owner of the Sports Authority corporate building, Denver-based Etkin Johnson Real Estate Partners, to gauge their plans for the property.
The building, at 1050 W. Hampden Ave., at the junction of South Santa Fe Drive and Hampden, and across the street from CityCenter Englewood, the mixed-use redevelopment of the old Cinderella City Mall that has struggled with retail vacancies despite its connection to light rail.
"Our desire is to see the ability to bring in another primary employer or multiple primary employers to ensure we have a vibrant and sustainable economy here," Keck said.
Etkin Johnson did not return a call for comment Wednesday.
At one point, Sports Authority had about 900 employees in Englewood, Keck said, making it the city's second-largest employer, behind Swedish Medical Center.
Even though Sports Authority is smaller today, losing a workforce that size across the street from CityCenter is a concern, Keck said.
"It's a challenge," he said, "but also an opportunity to potentially look at this area in a larger light."
In a statement provided Wednesday, Sports Authority said it is "optimistic" about the upcoming bankruptcy sale process. "We have received initial expressions of interest from a number potential buyers."
In bankruptcy filings, the company did request to pay lump-sum retention bonuses to "key non-insider employees" in departments such as accounting, finance, human resources, information technology, legal, operation and sourcing, at a cost of no more than $1.25 million.
The goal was to help combat declining employee morale and unease as well as increase the likelihood that the proceeds received through the sale or liquidation of assets would be maximized.
"It is possible that a number of the (retention program) participants will confront the loss of employment in the near future; therefore it is crucial that the debtors maintain the loyalty of these key employees to deliver their best performance throughout the Chapter 11 cases," the company wrote.
Nixon's Coffee House owner Brad Nixon said that, over the years, both Sports Authority staffers and the company's vendors have been frequent customers of his CityCenter shop.
"We do see quite a few Sports Authority folks come to the coffee shop. We love having them come in and out," he said.
And while he was sad to hear the news, Nixon said he's not too concerned about the long-term impact to his business.
"It will be a change. I do admit it will be a change, but I'm not worried in the long term," Nixon said. "It will make a nice facility for somebody who wants to come along and grab it."