Gimbel Bros. is about to be no more.
After nine months of trying, Batus Inc. said Wednesday that it has agreed to sell the last of its Gimbels stores, including the famous flagship in Manhattan’s Herald Square, to a group of real estate developers.
The sale of the two stores and a Long Island warehouse--for undisclosed terms--essentially completes a restructuring of retail operations announced last January by Batus, the U.S. unit of British-based BAT Industries.
High-Rise Tower Slated
As has been speculated in the industry, the purchasers--Melvin Simon & Associates, Silverstein Properties and Zeckendorf Co.--intend to convert the stores into retail and office space, according to Larry Silverstein, president of New York-based Silverstein Properties. Although plans are nowhere near complete, he said, the major change will be that the upper floors of the 86th Street store will be demolished so that a high-rise condominium tower can be built.
John D. Tyson, a spokesman at Batus headquarters in Louisville, Ky., said almost all merchandise has been sold at the Manhattan stores, where clearance sales started in late June. He added that the deal, which is subject to a definitive agreement, is expected to close within 90 days.
Other Gimbels locations in Pittsburgh, Philadelphia and Milwaukee have already been turned over to other purchasers, including May Department Stores, Allied Stores, Federated Department Stores and Associated Dry Goods.
Separately, BAT Industries, which also has tobacco and insurance interests, said it posted a 23.1% rise in pretax profit for the first half of 1986. The company attributed the profit increase largely to soaring earnings from its financial services.
The company said U.S. retailing income rose by 9%, as Batus’ remaining retailing operations--Saks Fifth Avenue, Marshall Field and Ivey’s--achieved “growth well up with the industry leaders.”