NEW YORK — The retail scene has another major player.
NRDC Equity Partners said Thursday that it has agreed to purchase Lord & Taylor from Federated Department Stores for $1.195 billion and has at least one more retail deal in the works that could be completed this year. Among the properties the company could examine is Saks Fifth Avenue, which is not officially up for sale.
"Our approach is not to wait for a process to be created. We started working on Lord & Taylor before it was put up for sale, before there was a process," said Richard A. Baker, president of NRDC, in an interview Thursday.
He wouldn't specify any deals in the works, but said another will happen this year.
NRDC met Federated's expectation for getting at least $1 billion, and intends to continue to operate L&T.
Last year, NRDC Equity bought Linens-N-Things for $1.3 billion, and in the past year, the partnership has examined Toys ‘R' Us, Pathmark, Burlington Coat and Hudson's Bay. However, those businesses were bought by other concerns.
"NRDC is interested in acquiring high-quality retail brand companies that have a real estate perspective," Baker said. "We look at every retail situation."
The deal to sell Lord & Taylor moved relatively swiftly. After Federated put the retail chain up for sale in January, Federated said L&T was attracting a good amount of interest. Federated expects to close the all-cash deal in the third quarter of this year.
The agreement brings some relief to the team at Lord & Taylor, as well as vendors supplying the chain. While it's clear now that Lord & Taylor will continue to operate for a while, a telltale sign of whether it has more than just a few years in its future depends on how much capital NRDC invests in renovating the stores. Much is needed to be done at the flagship and other locations to recharge the business. But the long-term future of the flagship is still in question, and there is speculation it eventually could be redeveloped. The potential redevelopment value of the flagship was one of the main attractions for bidders.
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