Finance & Capital Management

This week, 10,000 current and former Chipotle employees filed a class-action lawsuit claiming back wages, working off the clock and various labor violations. The suit should finally be the wake-up call necessary to get c-suite executives at restaurant, retail, hotel & lodging, convenience stores and other labor-intensive industries to take the issue seriously because the Chipotle case may be the tip of the iceberg.  

Quick-serve restaurant chain Chipotle has been hit with a lawsuit in which current and former Chipotle employees claim that the company made them work extra hours "off the clock" without paying them, CNN Money reported.   

Though it forecasts a stronger-than-anticipated closure season, Cushman & Wakefield sees average retail rents ending the year 4.6% higher than they were in 2016.   The company’s U.S. Macro Forecast released this week said that consistent demand for space in Class A retail centers is the biggest factor in rental-rate growth. Cushman analysts also predict that 2016 will see a drop in the retail vacancy rate to 5.8% from 6.6% last year — though they see it moving back up to 6% in 2017.  

Chico’s FAS reported better-than-expected second quarter earnings and announced new cost-saving measures. It also said the president of its namesake brand is stepping down.  

Photo: Paul Pressler   The CEO of David's Bridal is out after three years on the job.    The specialty retailer said Pam Wallack has left the company, but gave no reason for her departure, the Associated Press reported. Wallack will be replaced by David’s Bridal chairman and former Gap Inc. head Paul Pressler, who once worked with her at Gap.          

Inland Private Capital Corp. announced the sale of a Mariano’s Fresh Market in Vernon Hills, Illinois, on behalf of one of its 1,000-plus investment programs. Sale price for the seven-acre property and 71,248-sq.-ft. store was $36.4 million.   Mariano’s, a Kroger banner, is Chicagoland’s up-and-coming fresh grocer with some 35 locations in the area. Roundy’s had owned the chain and held the lease at the Vernon Hills location until it was acquired by Kroger last November.  

Things are looking bleaker for bankrupt Aeropostale.   A bankruptcy court judge on late Monday rejected a request from Aeropostale to blame its bankruptcy on Sycamore Partners and block an offer from the private equity firm.   Sycamore Partners confirmed it submitted a bid for the chain after the judge issued the opinion. The amount of the bid is unknown, but it may have been $150 million, which is how much Aeropostale owes two affiliates of Sycamore, Aero Investors and MGF Sourcing Holdings.

Photo: Michael K. Bloom   Fred’s announced it has promoted COO Michael K. Bloom to chief executive, effective Aug. 29.      Bloom succeeds CEO Jerry A. Shore, who became chief executive in October 2014 and intends to retire in February.   

Howard Hughes Corporation this week topped out the second of three residential towers destined for Ward Village, a 60-acre, master-planned community in Honolulu that will deliver 4,000 new residences when completed.    The finished Anaha tower, set to welcome residents in 2017, will house a Merriman’s restaurant and Oahu’s flagship Whole Foods Market.  

Abercrombie & Fitch Co.’s turnaround was called in to question on Tuesday as the chain posted a wider loss in its second quarter, hurt by a decline in tourist traffic at its flagship locations.     The teen apparel retailer also revealed that it expects to close up to 60 U.S. stores as their leases expire this fiscal year. On its quarterly conference call, company executives said the chain has flexibility to close even more stores, with about half of its U.S. leases expiring by the end of 2017, the Wall Street Journal reported.