Retailer Forever 21 plans to layoff 358 people at its downtown headquarters as it closes its office, according to filings with the California Employment Development Department.

Employees remaining with the company will work remotely after the office closes, Forever 21 Chief Financial Officer Bradley Sell wrote in a letter filed with the EDD last month.

“The employment losses are expected to be permanent and will affect all of F21’s employees in the facility who are terminated in connection with the reduction in force,” the letter said.

Layoffs will begin April 21.

“Employees will not be able to displace more junior employees out of their job positions as a result of this mass layoff,” Sell wrote, adding that the affected employees were not part of a union.

Forever 21’s parent company leased 164,000 square feet of office space at the California Market Center in 2022. The space was meant to also house Lucky Brand employees. Forever 21 sold its previous Lincoln Heights headquarters in 2019.

Retailer has been hit hard

It’s been a tumultuous time for the fast fashion retailer. In December, its Chief Executive Winnie Park left the company to lead Philadelphia-based Five Below. She had led Forever 21 since 2022 and during her time at the company worked on bringing in younger customers and omnichannel offerings.

Last month, Bloomberg reported that Forever 21 was looking to close at least 200 locations and was preparing for a potential bankruptcy.

The company did not return a request for comment on the layoffs and bankruptcy reports.

Forever 21’s intellectual property is owned by Authentic Brands Group, a brand management firm which took over when Forever 21 first filed for bankruptcy in 2019.

Nationally, Forever 21 is operated by Catalyst Brands, a joint venture of Sparc Group and JCPenney.

Forever 21 has seen its competition increase in recent years as brands like Shein and Temu have grown in popularity, as has resale clothing.

In 2021, the value of the secondhand apparel market was $141 billion worldwide. In 2024 that number increased to $230 billion and was expected to rise to $350 billion by 2028, according to data from Statista.

And despite Forever 21’s woes, the size
of the fast fashion industry has a whole has been growing. In 2024 its market size was $141 billion and expected to increase to $163 billion this year, according to the Business Research Co.

In 2023, Shein acquired a one-third interest in Sparc Group while Sparc took a minority stake in Shein. The deal increased Shein’s presence in the U.S. with a co-branded fashion line. Shein customers were also able to return Shein goods at Forever 21 stores.

Shauna Mattis, a managing director at Jones Lang LaSalle Inc., said the retail market as a whole is seeing some changes.

“The retail market is transiting to more of a tenant market right now,” Mattis said. “That has a lot to do with the number of retailers declaring bankruptcy and the square footage coming back to the market.”

Party City and TGI Fridays are among the companies to recently file for bankruptcy.

Mattis said in the last 18 months there hasn’t been much construction of retail properties in L.A., which allowed landlords to increase rents. But that’s changing.

“For the first time in a very long time, we’re going to have more supply than demand which is why the market is transiting to more of a tenant favorable market,” Mattis said. She added that rents are now declining 1% to 1.5%.