The Lane furniture store in Merced is closing after eight years in business because of the poor real estate market and the furniture manufacturer’s bankruptcy, the owner confirmed Tuesday.
Jason Tucker, who is also the general manager, said the area’s housing market crash has been hard on business. And it doesn’t help that the nation’s largest furniture manufacturer, Furniture Brands International Inc., filed for bankruptcy, thus slowing the supply of inventory to retailers.
“The management determined that closing the store was the best way to address the corporate bankruptcy and the local economic challenges,” Tucker said in a news release. “It was a difficult decision.”
Late last year, Missouri-based Furniture Brands sold most of its assets to an affiliate of New York-based KPS Capital Partners for $280 million. KPS then announced a new company had been formed, Heritage Home Group, to control those assets, which include furniture brands such as Lane.
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Tucker said his store, which was supported by the national chain before the sale, is no longer and that created a hardship for his location, 900 Loughborough Drive in Merced.
“Our intention was to work hard through the recession and continue the Lane name in our area,” Tucker said in the news release. “We have loyal customers and the best employees, which made the decision even more difficult.”
Tucker said the store employs five full-time and five part-time workers.
In a mailer to customers, Lane Furniture announced it will sell off at least $2 million in inventory at the Merced store.
The store has been closed since Monday to prepare for a “preferred customer sale” from Thursday through Feb. 17, the mailer states. The five-day sale is available to customers who bring the letter to the store, according to the mailer.
The furnishings will be available to the general public after that.
Lane is located in the Merced Mall Plaza next to stores including Action Computers and Fusion Cafe. Owners of those neighboring stores did not voice concerns over the Lane’s closure.
Tucker opened Lane Home Furnishings in Merced in September 2005. The new store was a relocation and rebranding of his downtown business, Bare Essentials Unfinished Furniture, according to Merced Economic Development Director Frank Quintero.
“(Lane) has been a mainstay in Merced for several years,” Quintero said.
The 12,000-square-foot Lane Furniture building has an assessed value of more than $1 million and the land around it about $115,000, according to the Merced County Assessor’s Office database.
Quintero said that along with the sagging housing market, big-box stores such as Target and Wal-Mart also carry furniture and are probably taking a bite out of the market.
As one furniture store closing, another is ready to settle in downtown. Quintero said a furniture store will be moving into the building that used to house The Oak Warehouse on Martin Luther King Jr. Way and 16th Street. The business has not decided on an opening date and the site is undergoing improvements.
Near the Lane store, some vacant commercial spaces are being filled by other businesses, including In-Shape Fit, Panera Bread, Chipotle Mexican Grill and Harbor Freight Tools.
Quintero said that could make filling a space such as Lane’s less difficult.
“It’s a good center and it’s well-located,” he said. “Depending on what Jason (Tucker) wants to do, there’s some good opportunities.”