A&G's Andy Graiser: Chapter 11 Alternatives are Gaining Traction

 More retailers and other companies are using out-of-court workouts to optimize their portfolios and bolster their balance sheets

NEW YORK, Dec. 23, 2025 /PRNewswire/ -- Struggling retailers and their asset-based lenders can use out-of-court workouts to escape today's escalating Chapter 11 bankruptcy costs, advised a restructuring veteran from A&G Real Estate Partners.

That might sound counterintuitive at first, simply because Chapter 11 gives retailers the power to walk away from their non-core leases.

But rising Chapter 11 bankruptcy costs have spurred more retailers and other companies to restructure their real estate out of court, explained A&G Co-President Andy Graiser during a panel at Debtwire's 2025 Restructuring Forum in Miami. "Right now, we are working with 14 different companies that are restructuring out of court to avoid Chapter 11," he noted.

Major retail Chapter 11 filings sank to a low of just three in the stimulus-fueled economy of 2022. According to Debtwire's restructuring database, they rebounded to 17 in 2023, 15 in 2024 and at least 12 so far this year.

A&G has been at the center of real estate restructuring for bankrupt chains. In just five cases over the past two years—Party City, Big Lots, Joann, The Container Store and Rite Aid—A&G led occupancy cost reduction, lease restructuring and disposition efforts for more than 4,000 leases and fee-owned properties. The work covered more than 110 million square feet of retail, office and industrial real estate and yielded $1 billion in savings and sales proceeds.

On the non-bankruptcy front, moderator Derek Hunter of Kirkland and Ellis turned to Graiser for insights into the role of out-of-court real estate workouts in today's marketplace.

Graiser laid out a strategic approach.

"While you cannot reject a lease in a non-bankruptcy, we can put a transaction together with a large number of landlords," he told the audience. "Our message to landlords is straightforward: There's a limited bucket of dollars that are available to pay lease termination fees. Either we resolve 90% of the leases in the next 30 or 45 days, or the company will have to file for Chapter 11."

Providing transparency into the reality of the situation is essential, he added. Given today's bankruptcy dynamics, the landlord's recovery could easily be zero.

By contrast, A&G's out-of-court approach with result in guaranteed termination payments that they would not have otherwise have received in a Chapter 11, creating a strong incentive to work with the retailer. "Needless to say, not one size fits all and there are many nuances about each case and its capital structure that drive the option to consider an out-of-court restructuring," Graiser told the panel.

Graiser also highlighted the benefits of a pre-packaged bankruptcy, sometimes called a prepack, in which creditors and the company agree to a detailed plan prior to the Chapter 11 filing.

Since time is money in Chapter 11 bankruptcy, he explained, this fast-track approach can be worth exploring.

"Prepacks, quick Chapter 11s, have worked out great," Graiser told the audience. "I remember us working with Mattress Firm—35 days, 2,600 stores, 2,200 landlords, $350 million of savings. The point is, it can get done."

Additional panelists were: Thomas H. Ripley, Partner and Co-Founder, Ames Watson; Marc D. Puntus, Partner, Centerview Partners; U.S. Bankruptcy Court Judge Brendan L. Shannon, District of Delaware, and Michael Gatto, Partner, Silver Point Capital.

About A&G
A&G Real Estate Partners is a team of commercial real estate experts that always derives the highest possible value for clients' real estate assets and leases. A&G brings a proven track record in portfolio-optimization, real estate sales, due diligence, valuations, and strategic growth consulting in virtually every real estate sector. Known for integrity, technology, and market intelligence, A&G has advised the nation's leading brands in both healthy and distressed situations. Since 2012, the firm has sold over $13 billion in properties and leases and negotiated over $12 billion in occupancy-cost savings for clients. A&G is headquartered in New York with offices throughout the country. For more information, visit: www.agrep.com.

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SOURCE A&G Real Estate Partners