90-year-old Party City rival files for Chapter 11 bankruptcy

The party supplies and costumes industry suffered a huge loss when party supply retailer Party City filed for Chapter 11 bankruptcy for the second time in two years on Dec. 21, 2024, seeking to wind down over 700 store locations in 2025. Walmart, Target, Michael's, and dollar stores like ...

Jan 11, 2026 - 09:00

90-year-old Party City rival files for Chapter 11 bankruptcy

The party supplies and costumes industry suffered a huge loss when party supply retailer Party City filed for Chapter 11 bankruptcy for the second time in two years on Dec. 21, 2024, seeking to wind down over 700 store locations in 2025.

Walmart, Target, Michael's, and dollar stores like Dollar Tree stepped in to fill the void for party supplies and balloons. Walmart and Target sell a very limited amount of party supplies compared to Party City.

Partiers can turn to Michael's and Dollar Tree for an adequate selection of helium balloons, but it's not as extensive as Party City.

Party City was the top party supply store

Party City was the go-to store for supplies whenever a child's birthday party was on the way, to pick up birthday and special occasion balloons, or to pick out an outfit for a costume party or Halloween.

My family always headed for Party City to buy supplies for birthday parties featuring themes such as Star Wars or Barbie. For Halloween, I liked grabbing ridiculous character rubber masks like the classic Ronald Reagan or Jimmy Carter. Scary stuff.

Most communities saw their Party City stores close down, but the party supply chain still operates 19 locally-owned franchise locations across the country in Arkansas, California, Hawaii, New Jersey, Tennessee, Texas, Virginia, and in the Commonwealth of Puerto Rico.

Champion Party Supply files for Chapter 11 bankruptcy with an uncertain future.

Champion Party Supply files for bankruptcy

And now a Party City rival has filed for bankruptcy protection after facing some unfortunate circumstances.

Iconic Seattle-based retailer Champion Party Supply LLC filed for Chapter 11 bankruptcy protection, as it evaluates whether to continue operations or liquidate its assets, according to RK Consultants.

The 90-year-old party supply retailer filed its Subchapter V petition in the U.S. Bankruptcy Court for the Western District of Washington, listing over $44,000 in assets and over $936,000 in liabilities, including over $280,000 in secured claims and over $14,000 in priority tax obligations.

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The debtor also made payments to creditors within 90 days of its filing date, including over $40,000 in secured debt to CIT Group and over $8,700 in supplier payments, which it might be able to recover.

"For preferential transfers, the trustee or debtor-in-possession can claw back payments made to non-insider creditors within 90 days before the bankruptcy filing date, provided the other elements of a preference are met," according to Delaware law firm Morris James LLP.

Disruptions and displacement fuel distress

Champion Party Supply attributes its distress to operational disruptions and displacement from its Interbay location, which was caused by the Sound Transit Ballard Link Extension Project.

The project forced the debtor to relocate to an 8,000-square-foot location in Seattle's Georgetown neighborhood in June 2024.

Other economic issues that led to the bankruptcy filing include rising urban retail lease rates, a global helium shortage affecting high-margin balloon sales, and increased competition from e-commerce and seasonal pop-up retailers.

Champion Party Supply launched in 1936

Champion Party Supply was founded at 1417 4th Avenue in downtown Seattle in 1936 by Robert Champion as a sign-making and retail display business. The store moved to Pike Place Market in 1950, and transitioned into the party and costume industry.

The store remained the Pike Place Market location for 43 years before moving to a location near the Space Needle in 1993 and moving two more times to its Interbay store in 2015 and current location in 2024.