Toys R Us will close all of its stores Friday

  • Toys R Us is winding down its going-out-of-business sales. 
  • Friday, June 29 will be the last day to shop at locations of the bankrupt retailer.
  • Sales are now running up to 60-90% off, but stores with less stock have already closed.

Toys R Us is uttering its final gasps of breath before it vanishes from the retail landscape forever.

The toy retailer that was at times both venerated and reviled will wrap up all of its going-out-of-business sales by Friday, June 29. After that, all of its stores will close, and Toys R Us as we know it will cease to exist, the bankruptcy of the former stalwart of toy retail finished, its flame snuffed out.

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Inside Toys R Us' closing headquarters
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Inside Toys R Us' closing headquarters
Welcome to a completely empty Toys R Us headquarters, where everything is for sale.

(Photo: Toys R Us)
That includes things like displays of Geoffrey the Giraffes and cafeteria furniture.

(Photo: Toys R Us)
Touches of Toys R Us can be seen throughout, but otherwise, the pictures depict a relatively normal suburban office park.

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A renovation done last year in the kitchen means plenty of relatively new equipment is for sale.

(Photo: Toys R Us)
The sale also includes items from the Starbucks satellite that's on campus.

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Normal office furniture, like these executive chairs, will be up for grabs.

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There are some whimsical items for sale, too, befitting a toy retailer.

(Photo: Toys R Us)
This giant Minion of "Despicable Me" fame needs a home ...

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... as does this life-size King Kandy, from the Candy Land board game.

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Some items, while appearing fun, may only be valuable to those with imagination.

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A K'Nex Ferris Wheel sits next to a plant.

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The auditorium provides plenty of opportunity for those looking for discount audio equipment.

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More standard office equipment is spread through the eerily empty cubicles.

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The ample square footage may trigger jokes referencing hit NBC comedy "The Office."

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There is also some higher-end furniture available for sale, like these Barcelona Loungers.

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Sully from "Monsters, Inc." broods over a for-sale pool table.

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Printers — the stalwarts of modern office culture — sit idly by.

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Leftover office supplies, like these paper goods, will also be liquidated.

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Certain pictures of offices in the campus bring to mind a nostalgic sentiment, when corner offices were still coveted and large.

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Suburban office parks, like Toys R Us, have fallen out of favor with modern corporate America.

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Younger workers typically want to live in cities, and most companies don't need the ample space a location in the suburbs affords.

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New Jersey now has 6.5 million square feet of leasable space in office parks around the state, CoStar, a commercial real estate company, told The New York Times. (Photo: Toys R Us)
"The model as it played out in New Jersey is now seemingly obsolete," Louise Mozingo, a professor of landscape architecture and environmental planning at University of California, Berkeley, told The Times.

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The retailer's Twitter account has been counting down the days.

Many stores that have run out of stock have already closed. Those that are still open are running clearance sales of up to 60-90% off. 

It's an unceremonious end for a retailer that was once known as a "category killer" — meaning that it got so good at one thing that it drove independent stores out of business.

Toys R Us filed a motion to liquidate its US business in March, setting off the process of closing or selling all 735 of its stores in the United States. It had filed for Chapter 11 bankruptcy protection in September.

How did we get here?

The debate over who and what killed Toys R Us is is still raging among analysts, company executives, and shoppers lamenting the chain's death.

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Inside look at Toys R Us
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Inside look at Toys R Us

The Toys R Us I went to in Yonkers, New York, was on the list of store closures announced in January. It will close soon. 

Photo credit: Business Insider/Jessica Tyler 

But when I walked in, there were no obvious signs of this. It looked well-stocked, and we didn't see any clearance tags at first. 

Photo credit: Business Insider/Jessica Tyler

As I continued walking through the store, I realized how wrong my first impression was. The shelves only looked stocked because everything was spread out and pushed to the front. Small sale signs were next to nearly every item. 

Photo credit: Business Insider/Jessica Tyler

It seemed as if the empty shelves were strategically hidden behind the larger displays up front. 

Photo credit: Business Insider/Jessica Tyler 

Nearly everything was on sale or marked as clearance, and many of the shelves were empty. 

Photo credit: Business Insider/Jessica Tyler 

Several aisles looked like this. 

Photo credit: Business Insider/Jessica Tyler 

The farther back in the store I went, the more depressing it looked. 

Photo credit: Business Insider/Jessica Tyler 

But quite a few aisles were fully stocked. Many were full of sale and clearance tags, but some weren't. 

Photo credit: Business Insider/Jessica Tyler 

Similar to those in the front of the store, many shelves that appeared well-stocked at first actually had one product pushed to the front so that it looked as if there were more. 

Photo credit: Business Insider/Jessica Tyler 

A lot of torn boxes seemed to have been left randomly around the store ... 

Photo credit: Business Insider/Jessica Tyler 

... and some displays were falling apart. 

Photo credit: Business Insider/Jessica Tyler 

A lot of the merchandise wasn't in great condition. This Minnie Mouse toy looked as if it had been stepped on and then put back on the shelf. Other toys were spilling out of boxes, and many of the stuffed animals were collecting dust. 

Photo credit: Business Insider/Jessica Tyler 

The Lego display in the center of the store looked sad ... 

Photo credit: Business Insider/Jessica Tyler 

... and the electronics section didn't look much better. The store still had a large selection of video games — none of which were on sale — but many accessories and other electronics were out of stock. 

Photo credit: Business Insider/Jessica Tyler 

The pattern of empty shelves and clearance sales continued as I walked back toward the front of the store. 

Photo credit: Business Insider/Jessica Tyler 

The displays by the register were sparse ... 

Photo credit: Business Insider/Jessica Tyler 

... and some were empty. 

Photo credit: Business Insider/Jessica Tyler 

This table was past the registers, right before the exit. It had a few marked-down items on it, but there was no label and no one around to ask what it was. Overall, the store was sad, and it seemed representative of what the future of Toys R Us holds as its stores prepare to close.  

Photo credit: Business Insider/Jessica Tyler 

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Toys R Us was once king of the toy castle. In the 1990s, it was the biggest toy seller in the US, expanding rapidly as it pushed out smaller chains. But by 1998, things had changed, and Walmart began selling more toys than Toys R Us in the US — a signal of more trouble ahead.

Toys R Us then launched a turnaround plan that ended with the chain seeking buyers. Bain Capital, Kohlberg Kravis Roberts, and Vornado Realty Trust together invested $1.3 billion in a $6.6 billion leveraged buyout in 2005, taking Toys R Us private. The company had essentially been purchased using its equity, with the help of the private-equity cash.

This saddled Toys R Us with an astronomical amount of debt — over $5 billion worth — that the company hadn't shaken even a decade later. According to the filing with the bankruptcy court, Toys R Us was still making $400 million payments on its debt each year.

"In Toys' case, high leverage remaining from the 2005 leveraged buyout reduced financial flexibility, which in turn limited investment, leading to the erosion of the company's competitive position at a time when its primary competitors such as Walmart, Amazon, and Target were running on all cylinders," said Charlie O'Shea, a Moody's analyst.

These high payments prevented the chain from making the changes necessary to compete, like improving the in-store experience and beefing up e-commerce in the age of Amazon, the company said in the filing. The debt also prevented the chain from keeping up the appearance of its stores and ensuring its employees were well-paid.

The retail landscape was shifting underneath Toys R Us' feet, and the combination of increased competition and lack of maneuverability helped lead to its demise.

In the liquidation filing, Toys R Us blamed its poor holiday performance on Walmart, Target, and Amazon pricing their toys low enough that it couldn't compete and make a profit.

But not everyone agrees that Toys R Us' debt load led directly to its downfall.

"When you have Target/Walmart on one side and Amazon on the other ... the amazing thing is that it was alive at all," Jim Cramer said on CNBC.

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