This interview is part of our series Econ Extra Credit with David Brancaccio: Documentary Studies, a conversation about the economics lessons we can learn from documentary films. We’re watching and discussing a new documentary each month. To watch along with us, sign up for our newsletter.

2020 was a turbulent year for retailers, but the pandemic wasn’t solely to blame for the many bankruptcy filings last year, including those from J.C. Penney, Neiman Marcus, Brooks Brothers and J. Crew. The growth of e-commerce and fundamental changes in how we shop contributed, along with mounting debt.

Soma Biswas, who covers bankruptcy and restructuring for The Wall Street Journal and WSJ Pro Bankruptcy, said that many retailers have struggled to absorb significant debt burdens after being bought by private equity firms who borrow money to pay for the purchases.

Leveraged buyouts of mall brands by private equity firms have been happening for a long time, but Biswas says they’ve accelerated over the past 10 years.

“For retailers facing pressure from e-commerce, while they might be able to sustain that debt if they weren’t facing that pressure, that made it harder. It certainly contributed to quite a few retailers filing for bankruptcy or even liquidating and disappearing,” Biswas told “Marketplace Morning Report” host David Brancaccio.

And private equity owners don’t always have the patience or will to invest money into a struggling business that might be required to fortify brands facing economic headwinds — like a pandemic or much tougher online competition.

“Typically they’re buying something with the idea that they can exit it profitably within, let’s say, five to seven years,” Biswas said. “But if the company can’t sustain its debt and has to restructure, as happened with J. Crew and Neiman Marcus, they typically don’t try to save it by putting in more money. They let go of it, they move on to other investments.”

Other investors work within a longer timeframe. Simon Property, which owns more than 100 shopping malls across the country, has been buying up brands like Eddie Bauer in an apparent attempt to keep store vacancies to a minimum. With Simon Property’s expertise in real estate rather than maintaining brands or running retailers, it has partnered with brand management company Authentic Brands to assess and acquire familiar names like Forever 21, Brooks Brothers, Aeropostale and Lucky Brand Jeans.

There’s a third scenario for a retailer in distress: spin it off into a separate company on the stock market with the hope that investors can provide the capital needed to help the store adapt. L Brands just announced it would do this with Victoria’s Secret and Bath & Body Works, splitting them into two publicly traded companies.