NEW YORK — Lord & Taylor has a future on Fifth Avenue after all.
It's looking more and more likely that the L&T flagship is staying put and that the retailer's new owners are well into formulating a vision for downsizing and renovating the huge site.
"We are working hard at analyzing all different alternatives. It's quite likely it gets reduced in size and quite likely office tenants are very viable in the building above Lord & Taylor," said Richard Baker, the chain's new chairman.
Baker is also vice chairman of National Realty and Development Corp. and president of NRDC Equity Partners LLC, which purchased L&T from Federated Department Stores earlier this year for $1.1 billion. Baker's thumbs-up on L&T came during a panel discussion at the International Council of Shopping Centers conference Monday at the Hilton here.
While he stopped short of absolutely guaranteeing L&T's survival on Fifth Avenue and said he continues to examine options, he reiterated to WWD his positive message on the flagship's future, saying, "It's very likely we will downsize the L&T store on Fifth Avenue."
And Baker has a good idea of just how big the reinvented flagship should be: 250,000 to 300,000 square feet, he said. That would give the reconfigured store five or six selling levels, considering each floor plate is 50,000 square feet. The flagship currently has 650,000 square feet and 11 floors, including executive offices, and is considered very overspaced for the amount of volume it generates — roughly $140 million a year. The site is worth an estimated $300 million to $400 million.
According to retail experts, 250,000 to 300,000 square feet would be enough space to include all categories currently sold at the store, and the flagship would not sacrifice that much in sales, considering a lot of its volume is generated through the main and second floors.
Another department store retailer said maintaining a flagship presence in New York for L&T is important for building relations with vendors and bringing in new resources that could be distributed to other of the retailer's locations.
According to sources, NRDC is interested in pursuing an acquisition of Saks Fifth Avenue, which is not up for sale, but could be later next year. If NRDC ultimately bought Saks, it would be better for NRDC to hang onto the L&T flagship, which is not considered a direct competitor to Saks, rather than give it up to another, pricier retailer that would be competitive. Nordstrom, for example, is said to have checked out the L&T flagship and is eager to enter Manhattan.For decades, not much money was spent to update L&T stores, but Baker said he's working on a capital budget, envisioning $250 million for improvements at the chain, with $100 million specifically for the flagship. Baker said the Boston and Northbrook, Ill., stores would share in the capital budget; other units in Manhasset, N.Y.; Stamford, Conn., and Chevy Chase, Md., would be high on the list for capital improvements. The budget would cover several years.
Lord & Taylor has been performing better at its suburban locations than at the flagship.
One of the keys to ultimately deciding on the flagship is how business progresses. Baker said he is seeing improvements at branch locations, with some experiencing 20 to 30 percent increases due to the fallout from Federated Department Stores' conversion of former units of May Department Stores, which Federated bought early this year. Federated sold L&T to NRDC after the May acquisition.
"There's been a tremendous opportunity to pick up customers who are unhappy" with Filene's or Marshall Field's becoming Macy's, Baker noted, citing these as examples of where L&T can grab former May store shoppers.
"Lord & Taylor is having a good moment in time," Baker said. He said the chain has a "clear home," offering a certain quality of merchandise at a competitive price, above Macy's and beneath Saks and Nordstrom.
The 180-year-old company operates 48 stores and generated $1.4 billion in sales last year, though as recently as 2003, it operated 86 stores until an aggressive store-closing strategy, mostly through the Sunbelt, was unleashed.
Previously, Baker spoke of the possibility of opening additional stores in lifestyle centers in the Eastern corridor, in Connecticut, Long Island, New York, New Jersey and Pennsylvania. He also has singled out Westchester and Fairfield counties and believes L&T has a particular appeal to the "New England type of shopper, primarily in the suburbs," who seeks a price-range alternative to Saks and Neiman Marcus on the high side and Kohl's and J.C. Penney on the low side.
For the past four years, L&T chief executive Jane Elfers has led efforts to refocus the business on better, bridge and contemporary apparel and accessories for women, shedding moderate goods and reducing some of the retailer's past focus on price promotions.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)