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Effort to lease Gottschalks sites another dire sign

In another sign that Gottschalks Inc. is possibly headed toward liquidation, the Fresno retailer is trying to market its individual store locations.

Unloading store sites is often a signal that a retailer is preparing to go out of business.

Although Gottschalks still could survive, the company's real estate consultant, DJM Realty, has released a brochure offering the company's 69 retail locations in six states, including four in greater Sacramento. Most of the sites are leased; a few are owned by Gottschalks.

Gottschalks is operating under Chapter 11 of the bankruptcy code and faces a do-or-die auction for its assets March 30. The DJM brochure notes Gottschalks could be sold as a "going concern," which means the company stays open and the individual leases are pulled back off the market.

But real estate experts say the DJM effort shows the increasing likelihood that Gottschalks will be liquidated.

"It's just another dark sign -- a very unfortunate dark sign," said Garrick Brown of Colliers International real estate in Sacramento. Colliers isn't involved in the Gottschalks matter.

A consortium of liquidators has been designated as lead bidder, or "stalking horse," in the March 30 auction. Under the rules, anyone outbidding the liquidators would have to pay them a breakup fee of nearly $1 million. That gives the liquidators a leg up on anyone else.

Last week Bloomberg business news reported that three firms have expressed interest in bidding to keep Gottschalks open. They include El Corte Ingles, a Spanish retailer that owns 16% of Gottschalks' stock.

Gottschalks officials couldn't be immediately reached for comment today.