FAO Schwarz

Early history

FAO Schwarz was founded in 1862 in Baltimore under the name "Toy Bazaar" by German immigrant Frederick August Otto Schwarz.

In 1870, Schwarz opened a New York City location known as the "Schwarz Toy Bazaar" at 765 Broadway, which moved to 42 E. 14th Street in Union Square in 1880 and operated at that location until April 28, 1897, when it took over two vacant store locations at 39 and 41 W. 23rd Street. That year, The New York Times declared Schwarz as "the largest dealer in toys in this city."

Beginning in November 1869, the Schwarz Toy Bazaar held an exhibition of toys that would be available for the Christmas season. In 1896, Schwarz proclaimed the store as the "Original Santa Claus Headquarters" in New York. The FAO Schwarz holiday catalog has been published annually since 1876.

In 1931, the New York City location moved to 745 Fifth Avenue, where it operated for 55 years. In 1963, Parent's Magazine Enterprises purchased FAO Schwarz. The terms of the deal read that it would license the name FAO Schwarz and continue using it for a maximum of five years before dropping the name, while still paying the Schwarz family a royalty on sales. However, the lease was renewed as the owners felt the name was too significant to lose. Part of the price of keeping the name was to keep the royalty agreement, and the Schwarz family set up a foundation to fund opportunities for young people to work in nonprofit with the income the royalties were making. Nine percent of the company remained in the hands of the Schwarz family. The company subsequently sold to W.R. Grace in 1970, and then to toy retailer Franz Carl Weber of Zurich, Switzerland, in 1974.

In 1985, Christiana Companies, a company based in San Diego, California, owned FAO Schwarz for one year. In 1986, Peter Harris, with the help of Philadelphia investment banker Peter Morse, bought the company under Morse Partners Ltd. and moved the toy store across 58th Street to the General Motors Building at 767 Fifth Avenue at 58th Street. FAO Schwarz was sold to Netherlands-based NV Koninklijke Bijenkorf Beheer (later renamed Royal Vendex/KBB NV) in 1990. Throughout the 1990s, new FAO Schwarz stores opened across the United States; by 2000, the company had 40 locations.

Right Start, FAO Inc. and bankruptcy

In 2001, the Calabasas-based toy retailer Right Start, Inc. purchased 23 of the 40 stores, including the Fifth Avenue flagship store, from Royal Vendex for somewhere between $50 million and $60 million.

In 2002, Right Start Inc. changed its corporate name to FAO Inc. operating stores under The Right Start, Zany Brainy and FAO Schwarz names. On December 17, the company projected they would file for bankruptcy if its bank did not relax borrowing restrictions. On January 13, 2003, FAO Inc. filed for bankruptcy, but emerged from it three months later in April. The company filed for bankruptcy a second time in December 2003. All 13 remaining FAO Schwarz locations closed in January 2004 as a result of the bankruptcy, with the flagship Fifth Avenue store expected to reopen in July of that year but the others closing for good. The Fifth Avenue store reopened several months later than planned on Thanksgiving Day 2004, redesigned and renovated to accommodate a growing number of tourists, and the Las Vegas location at The Forum Shops at Caesars ultimately remained open until 2010.

D. E. Shaw & Co.

In February 2004, investment firm D. E. Shaw & Co., L.P., acquired the FAO Schwarz stores in New York and Las Vegas, as well as FAO Schwarz's catalog and internet business. The New York and Las Vegas stores reopened on Thanksgiving Day 2004. In November 2007, FAO Schwarz acquired premium children's clothing company Best & Co., which had plans to expand, but the company ceased business in 2009.

Retail locations

The FAO Schwarz global flagship is at 30 Rockefeller Plaza in Midtown Manhattan.

Its Chicago location is inside Midway International Airport.

The London store is in Selfridges.

Its Beijing store is in China World Shopping Mall in Chaoyang District, operating in collaboration with Kidsland, China’s largest toy distributor. Comprising 30,000 sq ft on two floors, the Beijing store features a clock tower on the facade, a rocket ship, a custom racecar crafting station, and a replica of the giant piano from the movie Big.