With debts of 55 million shekels: Court orders liquidation of homeware chain Spaces

The Central District Court has ordered the liquidation of the homeware chain Spaces, after it accumulated debts of 55 million shekels. Judge Merav Ben Ari ruled that there is no reasonable chance of rehabilitation and appointed attorney Ron Hamad as trustee. The chain, which at its peak had 11 branches, collapsed due to harsh market conditions, COVID-19 damages, and the wars.

The Central District Court yesterday ordered the liquidation of the "Spaces" chain, which specializes in homeware, kitchen products, and food. Judge Merav Ben Ari ruled that there is no reasonable chance of rehabilitation and appointed attorney Ron Hamad as trustee. The chain fell into debts of 55 million shekels and sought court protection. At its peak, the chain had 11 branches, starting with a few stores before expanding to premium locations. The liquidation request was filed about a month ago through the law firm of Mike Shitrit, from which it emerged that the chain had entered a deep cash flow crisis that worsened to financial collapse, due to harsh market conditions, cumulative damages from the COVID-19 period, and the prolonged wars since the Iron Swords War. Competition in the retail industry led customers from physical chains to online purchases, and sales at physical stores declined. In a hearing yesterday, one creditor (a property lessor) objected to the liquidation order, but his objection was rejected. A representative of the Insolvency Commissioner noted that the law is intended for such situations, to conduct a fair collective process among creditors. The judge ordered the opening of proceedings in the liquidation track for the companies Delimart and Spaces Delimart Hutzot HaMifratz. Attorney Mike Shitrit responded that the chain was managed with dedication, but harsh market conditions, rising commodity prices, import and rent costs, increased operating expenses, the shift to online purchases, and the cumulative effects of COVID-19 and the security situation led to the collapse. He welcomed the court's decision, which will allow an orderly conclusion of the companies' operations.