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How Laid-Off Toys R Us Workers Came Together To Fight Wall Street




Madelyn Garcia lost her mother the same week she found out she was losing her job. Just three days after the funeral she’d planned with her siblings, the 50-year-old returned to work at the Toys R Us store she managed in Boynton Beach, Florida. She had to liquidate all its inventory and her 30-year career.

The bedlam of the going-out-of-business sale made it feel more like the holidays than springtime. Garcia was on her feet for 12-hour days, six days a week, with no overtime pay and no future at the company. What kept her going was the possibility of Toys R Us finding a buyer and at least some of the stores being saved. But she also felt a basic sense of commitment to the retailer, even in bankruptcy.

“It’s the loyalty we had to the company,” explained Garcia, a mother of three who started her career at a Toys R Us in New Jersey in 1988. “I think we did it for each other, too. We were all going through difficult times not knowing where we would go or how we would manage.”

Once the store’s fixtures were going out the door, the reality began to set in. Toys R Us’ creditors rejected any offers to purchase the company. Garcia’s store closed June 30. There were no jobs and, worst of all, Garcia believed, no severance pay for her employees, many of whom still hadn’t found new employers. The sense of commitment, she realized, only went in one direction.

Garcia is now at the center of a battle that could have long-lasting implications for retail workers. She and other Toys R Us veterans have been trying to squeeze severance pay out of the private equity groups that bought the retailer, as well as the investment firms that held its debt.

Their campaign has already yielded results. On Tuesday, two of the company’s owners, the private equity groups Kohlberg Kravis Roberts and Bain Capital, announced that they would each put $10 million into a financial assistance fund for the workers. The distribution of the money will be overseen by Kenneth Feinberg and Camille Biros, high-profile lawyers known for their experience administering compensation funds. The amount workers receive will be based on their length of tenure at the company. 

KKR and Bain called it “a unique set of circumstances that called for a unique solution” and urged other stakeholders to chip in money.

Still, the Toys R Us workers are demanding a much larger fund, totaling $75 million, to be shared among the laid-off workforce of more than 30,000. They also want to draw public attention to retail’s looming private-equity problem and make sure all retail workers ― most of them women, and many living paycheck to paycheck in a largely non-union industry ― enjoy some basic protections if their companies go under. They have taken their fight to corporate lobbies, Congress and the courts.

“I don’t think private equity firms should be able to buy a company, load it up with debt, liquidate it and have nothing for the workers,” Garcia said. “We did all the work in the stores and in the warehouses…. We shouldn’t walk out empty-handed.”

The way these workers see it, Toys R Us wasn’t solely a victim of Amazon and the Digital Age. 

Cheryl Claude, an assistant manager at the Toys R Us store in Woodbridge, New Jersey, holds a sign in front of the Totowa, lo


Cheryl Claude, an assistant manager at the Toys R Us store in Woodbridge, New Jersey, holds a sign in front of the Totowa, location on June 1, after the company announced that employees will not get severance packages once the stores are closed.

Bain and KKR, along with the realty trust Vornado, bought Toys R Us in a leveraged buyout in 2005. The deal loaded the company up with around $5 billion in debt. Toys R Us was on the hook for annual interest payments of $400 million in the years leading up to its demise. Those obligations would have made it hard for the foundering retailer to invest in its workforce, upgrade its stores and adapt to online shopping. The chain was in business for 60 years and had 735 stores when it announced plans to close. 

Toys R Us is far from the only brick-and-mortar retailer saddled with debt through a leveraged buyout. Even if sales and the economy on the whole are humming, Bloomberg predicts the so-called retail apocalypse will accelerate as these debts come due. Delinquent loans could endanger a sector that employs 16 million Americans, many of them earning close to the minimum wage with little or no money saved.

“Clearly, this is not unique to Toys R Us,” said Eileen Appelbaum, an economist at the Center for Economic and Policy Research who has studied the effects of leveraged buyouts on retail and grocery workers. “We’re only talking about this because [the workers], like the Parkland kids, protested. They said, ‘We built this, we’re entitled to severance and we want it.’ That’s why people know the Toys R Us story.”

Because of the way bankruptcy laws are written, low-level employees tend to be last at the trough, behind a long line of creditors, when a company like Toys R Us goes under. Meanwhile, executives often make out just fine. Former Toys R Us CEO Dave Brandon received a $2.8 million “retention” bonus just before the retailer filed for bankruptcy late last year, part of a total compensation package that topped $6 million in 2017.

All store workers got was a 60-day heads-up that they would be losing their jobs. But even that wasn’t a courtesy. It was an obligation under the Worker Adjustment and Retraining Notification (WARN) Act, a federal law that requires advance notice for employees hit by mass layoffs.

“I think we’re going to see Toys R Us become a tipping point in this,” said Carrie Gleason, policy director at the Organization United for Respect, a retail worker center advocating for former Toys R Us employees. “You’ll see moms in hearings about bankruptcy reform. You’ll see state-level severance funds created. These women are powerful voices about the real-world impact when there are no rules.”

Garcia realized she wasn’t alone when she saw a video on Facebook of laid-off Toys R Us workers talking with Sen. Bernie Sanders in his office on Capitol Hill. The Vermont independent and former presidential candidate was pillorying the private equity groups for not providing severance pay. In the video produced by Sanders’ office, workers tearfully recounted their own financial hardships.

“It was my same scenario,” Garcia said. “Once I saw that video clip, I thought, ‘Oh, no, I have to be part of this. It’s an important fight.’”

The campaign took on the name Rise Up Retail, which is funded by the Organization United for Respect and the liberal advocacy group Center for Popular Democracy. Through Rise Up Retail, Garcia met fellow Toys R Us veterans agitating for severance pay, like Maryjane Williams.

Maryjane Williams, after 20 years with Toys R Us, took a lower position and a $15,000 pay cut for a position at another big-b

Michael Starghill for HuffPost

Maryjane Williams, after 20 years with Toys R Us, took a lower position and a $15,000 pay cut for a position at another big-box store.

Williams lost her job after two decades with the company, helping run Toys R Us stores in New York and later Waco, Texas, where she now lives with her husband. After the layoff, she had to take a lower position ― and a roughly $15,000 pay cut, she estimates ― at another big-box store. She landed the job because a previous supervisor at Toys R Us helped her out.

“I worked for the company for 20 years,” said Williams. “At the age of 50, where am I going? What am I going to do?”

I worked for the company for 20 years. At the age of 50, where am I going? What am I going to do?
Maryjane Williams

Many of the workers bonded over their common experience at Toys R Us. The company was different from other retailers, and not just because of its iconic giraffe and jingle. Working in a store devoted exclusively to children meant that managers and longtime hourly employees literally watched their customers grow up. As a kid once explained to Garcia, Walmart and Target may have toys, but those are mom’s stores: “He said, ’I love Toys R Us because this store is for me.’”

Part of that shared experience is less rosy. Former Toys R Us employees have plenty of anecdotes about how their stores went downhill after the leveraged buyout. In some locations, the company cut the number of managers and moved full-time workers to part-time, even though the amount of work remained the same, according to Williams. The frequency of floor cleanings was cut back, making some stores dingy. Williams said the air conditioning in her Texas store “was out half the time.”

“You could see the effects of the debt,” she said.

In June, a group of workers met in New York to protest outside the offices of KKR, Bain and Vornado, and deliver petitions to the firms demanding severance. All told, 75 workers from 14 states made the trip, according to Garcia. The workers hatched a plan to hold a silent protest in their stores before they closed so that customers would realize they were being let go without a parachute.

The participants all wore signs on their store uniforms shaming ownership for the lack of severance. Garcia’s said, “I worked 30 years and I get nothing.” She encouraged all the workers in her store to wear one. Roughly 40 of them did.

The group tried pressuring the private equity firms through the pension funds that invest in them. The workers succeeded in getting Minnesota’s pension plan to stop investing in KKR until it pledged money for the severance fund. They met with more than a dozen pension funds to persuade them to pull their money out of the firms.

Maryjane Williams is among former Toys R Us employees who are agitating to get severance pay for laid-off workers.

Michael Starghill for HuffPost

Maryjane Williams is among former Toys R Us employees who are agitating to get severance pay for laid-off workers.

Lately, the workers have turned their sights on Toys R Us’ main creditors: the firms Solus Alternative Asset Management, Highland Capital, Franklin Mutual Advisers, Angelo Gordon and Oaktree Capital. In August, The Wall Street Journal reported that those firms essentially blocked a Toys R Us reorganization effort that might have salvaged some stores. 

Oaktree Capital was the only firm to comment when asked whether it planned to contribute to the severance fund. A spokesperson said the firm did not have “any role or influence whatsoever” in the decision to liquidate the retailer, and that it wouldn’t be fair to its investors to put up money “to compensate for losses that our funds and our clients had nothing to do with creating.”

The severance campaign’s political support has continued to grow. In October, Sen. Elizabeth Warren (D-Mass.), a potential 2020 presidential candidate, sent a letter to the creditors asking why they did not try to reorganize the company. She dashed off a separate letter to Vornado recommending the company chip in to the severance fund.

Just days earlier, Garcia had taken part in yet another protest in Manhattan, in the lobby of Solus, the largest holder of Toys R Us debt. Solus is reportedly considering relaunching the Toys R Us brand and may soon have pop-up-style shops inside Kroger grocery stores. But it isn’t clear how former Toys R Us workers like Garcia figure in that plan, if at all.

“I think in the retail industry, we’re undervalued, the workers,” Garcia said. “This fight is for everyone, not just myself. And it’s not just about money. It’s for everyone who worked for Toys R Us and put years into the company. It’s important to me that our voices get heard.”

This is part of our five-story series spotlighting the current state of retail in America.


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11-Step Guide to Buying A House




Purchasing a home is likely going to be one of the largest purchases you will make in your lifetime, which is why it is so important to follow the right steps when starting on your home-buying journey to ensure that the entire process goes smoothly from start to finish!

We’ve put together a step-by-step guide to buying a home, to help you get off on the right foot when it comes to buying a home. Click the download button below to download these steps in PDF form.

1. Decide to buy a home

Make sure you are ready both financially and emotionally!

2. Get Pre-Approved

Work with a mortgage broker or your bank. They will work with you on what you require to submit an application. Once approved, this will determine how much you can afford to spend on a home.

3. REALTOR® Consultation

Work with a RE/MAX agent to help guide you through the process. The right agent will discuss your price range, ideal locations, current market conditions and much more!

4. Start Your Search

Your REALTOR® will get you information on new homes that meet your criteria as soon as they’re listed. They’ll work with you and for you to ensure you find your dream home.

5. Current Market Conditions

Your experienced RE/MAX agent is a valuable resource as you consider different properties. They will be there when you have questions regarding the homes you’re interested in – they can tell you what is a good deal, and when to walk away.

6. Make an Offer

Your REALTOR® will help create your offer tailored to your needs including the right subject clauses down to the closing date that works best for you.

7. Negotiate

You may receive a counter offer but don’t be worried! RE/MAX agents will negotiate for you to ensure you get the best possible price for the house you love!

8. Accepted Offer

It’s crunch time! The next few weeks are busy as you need to schedule and remove every one of your subject clauses by the specified date. You’ll likely need to schedule an inspection, appraisal, financing approval, and several others. You will also need to provide a deposit to put down on the home. The deposit will be a pre-determined amount given in-trust to your REALTOR® to show the sellers you are committed to this home. Don’t worry, that money goes towards the purchase of said home if all goes well! This is a busy time but be sure to reach out to your RE/MAX agent if you have any questions or are unsure about next steps.

9. Subject Removal

Once you have completed all your subject clauses, and everything went smooth, it is time for you to sign on the dotted line and consider your new home to be yours (almost!).

10. Official Documents

You will need to provide your RE/MAX agent with your preferred lawyer or notary to have the official title transferred into your name. You will meet with the lawyer or notary in person to sign all the legal documents before you move in. This typically happens a few days before you take possession of your new home.

11. Move In!

Congratulations, you are officially a homeowner! The date pre-determined by you is your move-in day! You can now move into your new home. Your RE/MAX agent will be there ready and waiting to hand you the keys. Enjoy!

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Know When to Rent ‘Em, Know When to Buy ‘Em




We’re told it’s always better to buy than rent. Everyone—from our parents to the banks to the government—encourages us to buy, buy, buy our homes.

But times have changed, and I dare say that these authority figures might be slightly out of touch. The jaw-droppingly high cost of real estate in big cities is encouraging millennials to rent instead of own, causing homeownership rates to drop. At 30 years old, 50.2% of millennials own homes versus 55% of baby boomers at the same age. As a millennial homeowner, I can’t help but wonder if I’m generationally displaced.

There’s an old misconception out there about renting that needs to be addressed. You’re not “throwing away your money” if you’re renting. While that familiar axiom might be true sometimes, there are plenty of circumstances in which it does actually make more sense to rent than buy.

You Might Choose to Rent If…

…You Invest What You Save

Renting tends to come with lower carrying costs than owning. Typically, all you’ll have to worry about paying as a renter is, well, the rent (clearly) and perhaps a share of utilities. This leaves you with extra monthly cash to invest, which can ultimately put you on even financial footing or better with a homeowner.

As always, there’s a familiar caveat here: You need to be financially disciplined for this strategy to pay off. One mistake I see a lot is that those who rent tend to fall prey to something called ‘lifestyle inflation.’ Rather than investing what they save as renters, they just rent nicer apartments, eat at fancier restaurants, and put more money into their wardrobe than their RRSP. But this money vacuum can be easily avoided by:

1. Budgeting to find out how much you have left over to invest each month after factoring out all your expenses, then;

2. Funneling that leftover money directly into your investments. Some robo-advisors, like Wealthsimple, allow you to do this automatically via pre-authorized contributions, which set recurring transfers from your chequing account into your investment portfolio, at whatever amount and interval you choose.

…You Have Rent Control, aka the Urban Holy Grail

Depending on where you live, you might be lucky enough to benefit from the urban miracle known as rent control. That means your landlord can only increase your rent by the rate of inflation, which in turn keeps your cost of living way down and leaves you with more money to invest. In Canada, rent control is now implemented in most big cities like Toronto and Vancouver (although not in Montreal).

…You Have a Mobile Lifestyle

Renting makes it easier to move; if you’d like to relocate it’s usually as simple as giving your landlord 60 days written notice. But when you own a home you’re more tied down, and the obligation to be near your property may prevent you from chasing new adventures in faraway lands. I once turned down a fantastic job opportunity in Dallas, Texas for this very reason.

…You’re on a Tight Budget

Renting tends to be more affordable than buying in big cities like Toronto and Vancouver. I know, I know, renting is still unreasonably pricey in certain neighborhoods. But buying in those same areas can be arm-and-a-leg expensive.

When you rent, all you have to come up with is the first and last month’s rent; no need to scrimp and save to pull together a massive down payment on a house, which, incidentally, will take you two to four times longer to save than it did your parents.

And homeownership leads to a lot of other costs aside from mortgage payments. When you buy real estate, you’ll need to pay closing costs, which typically add up to between 1.5%–4% of the property’s purchase price and can include a home inspection fee, real estate lawyer fee, land transfer taxes, and homeowners insurance (sometimes you’ll have to fork over an entire year’s worth of home insurance as one lump sum).

There’s also the elephant in the room that nobody likes to speak about: repairs and maintenance. Homeowners are responsible for paying the big bucks for costly home repairs, such as a new roof and furnace, and are advised to set aside 3–5% of a home’s value toward home repairs and maintenance each year. Renters, on the other hand, can just call their landlord whenever they need repairs (provided the landlord actually picks up). Still, it’s important that tenants know their rights when renting to be aware of which fees do and don’t fall under their responsibility.

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A Montreal Real Estate Broker Answered 5 Qs About Buying A Property To Rent Out




You’ve probably heard that Montreal’s real estate market is on fire. But how can you get in on the action? According to Alex Marshall, a local real estate broker, buying a property as an investment for the purpose of renting it out is a great way to go about it.

Marshall, who’s part of the Keller Williams Prestige team, sat down with us to explain why and how to purchase an investment property. These types of properties are also known as revenue properties.

Why do you recommend buying a revenue property?

Marshall used personal experience to highlight the advantages of owning a revenue property. He’s currently renting out the Saint-Henri loft he bought in 2010.

“Not only is my tenant paying off my mortgage, but I’m making a couple 100 bucks a month as well,” Marshall said.

Marshall was also able to take out a line of credit on the property, he said, and use the equity to buy an additional property.

“You actually don’t need to live in the property that you buy. I’m seeing clients who are in apartments with low rent [who] don’t want to move but have got the money right now … and are looking for smart ways to invest,” he said.

What are some tips to help people save up for a revenue property?

When Marshall was saving up to buy his first property, he said he worked a second job. 

“There’s a lot of value to having that side hustle … even if it’s at Subway or it’s at a landscaping company on Saturdays. It will add up significantly in the long run,” he said.

He gave the example of adding $5,000 to your annual income.

Marshall said you can qualify to borrow roughly four times your annual salary for a mortgage so $5,000 could actually provide you with an extra $20,000 of buying power.

“That might get you a second bedroom, that might get you a parking spot, that might get you a larger space,” he said.

The pandemic, Marshall said, has also helped some of his clients save extra funds.

“You can’t travel, you can’t go to the restaurant, you can’t go to the theatre, you can’t go to the bar. So a lot of people right now are finding themselves with almost a disposable income,” he said.

Marshall also recommends looking into Canada’s Home Buyers’ Plan program, which allows you to withdraw up to $35,000 — — tax-free — from your registered retirement savings plan (RRSP) to put toward buying or building a qualifying home. 

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