It was the retail icon of Long Island, a department store where generations shopped, trusting the value of its jewelry and home goods. No matter. News broke on Feb. 5 that the organization was closing, laying off about 378 people. During the summer, the families that owned and operated Fortunoff for four generations paid $1.8 million for their famous brand, its Internet domain names and customer lists.
>>Read more: Newsday's coverage of Fortunoff's troubles
Photo Credit: Frank Koester, 2009
Fortunoff's outdoor stores are making a comeback.
A Houston-based outdoor furniture retailer has formed an alliance with a member of the Fortunoff family and two former executives to open six Fortunoff Backyard Stores on Long Island and New Jersey on Feb. 1.
The Chair King, which has 18 outdoor furniture stores in Texas, last week purchased a controlling interest in Furniture Concepts Llc - a company formed by two former Fortunoff executives and a member of the Fortunoff family. Furniture Concepts owns licensing rights to the Fortunoff brand of outdoor furniture and seasonal products in the United States, said David Barish, president of The Chair King.
"I knew that the outdoor furniture side of the Fortunoff business was always very profitable," Barish said Thursday.
"After looking at the numbers, I saw how we could bring it back and make a lot of money doing so."
The terms of the deal were not disclosed, and Barish said the stores would be in the same markets but declined to give specific locations.
The Fortunoff and Mayrock families founded and owned Fortunoff, a well-respected regional retailer of gifts, housewares, furniture and jewelry, before the company was sold twice to different private equity firms, twice filed for bankruptcy protection and finally shut operations in May. Members of the two families purchased all the bankrupt company's intellectual property for about $1.8 million on July 6.
The idea of reviving the brand originated with two former Fortunoff executives. Marty Merkur and Bernard Sensale knew that the business was too good "to let die," Barish said. They asked him and The Chair King to become a strategic partner, but Barish said it was a good opportunity and decided instead that he wanted ownership in the new company, he said.
"We are bringing Fortunoff back in fact, not just in name," Sensale said Thursday.
Isidore Mayrock, who is a minority investor in Furniture Concepts Llc, will sit on the management board and serve as the company's "real estate guru," Barish said. Merkur and Sensale are part of the executive management team, and many of those who ran the Fortunoff outdoor stores are returning to the new venture.
"They have the backing of Chair King, who is very well known in the industry and provides a very similar product in Texas," said David Fortunoff, a Fortunoff family member. "So, by combining the purchasing power of the two entities, we expect the customers will win."