SAKS CLOSE TO DEAL FOR CLEARINGHOUSE IN MANHATTAN, REPORTEDLY IN LADIES MILE

Byline: Sharon Edelson

NEW YORK--Saks Fifth Avenue has found a site in Manhattan for a Saks Clearinghouse outlet, reportedly in the rapidly developing Ladies Mile area on Sixth Avenue.
Brian Kendrick, the company's vice chairman, disclosed last week that Saks is "pretty close to finalizing a deal," but he declined to divulge the location.
"We'll probably announce the Clearinghouse location next month," he said.
Sources said one possibility would be for Saks to take over 635 and 641 Sixth Avenue, between 19th and 20th Streets. The two sites are vacant at street level and could be developed into a 30,000-square-foot store.
Saks claims the Clearinghouse won't cut into its uptown business at the Fifth Avenue flagship, between 49th and 50th Streets. "We're accessing a different segment of the population, one that defines value differently than the customer of our Saks Fifth Avenue stores," Kendrick said. The move is expected to put some Saks vendors on edge.
Vendors acknowledged that outlets help move merchandise that didn't sell during the season at regular price, but they don't want the outlets too close to department or specialty stores. As Bud Konheim, chief executive officer of Nicole Miller, recently said, "I understand the problem of disposing of inventory that nobody is buying, but rather than look for a place in Manhattan, I'd like Saks to look for a place in Iceland."
Saks also wants to open a Clearinghouse to battle the growing presence of off-price chains, which carry many of the same resources as Saks, and Saks officials say outlets are very profitable.
The area Saks has reportedly chosen, Ladies Mile, is turning into an off-price corridor.
Filene's Basement and T.J. Maxx will move into 620 Sixth Avenue between 18th and 19th Streets this spring. The building currently houses Bed, Bath & Beyond.
The Gap's Old Navy Clothing Co. has leased a four-story Beaux Arts building at the southeast corner of Sixth Avenue and 18th Street for the flagship it plans to open later this year.
Ladies Mile is right in the backyard of Barneys New York's original flagship on Seventh Avenue between 16th and 17th Streets. Loehmann's is taking over part of that site.
Last month, Kendrick said he doesn't believe the Clearinghouse store will detract from business at Saks Fifth Avenue's flagship.
In another development, Kendrick said Saks is moving ahead with plans for its White Plains, N.Y., store, either renovating its existing site or building a new store on the same site, which would be part of a shopping center.
The developer of the site, Alexius C. Conroy, president of Conroy Development Co., of Greenwich, Conn., said the complex will be centered around a proposed new, state-of-the-art Saks unit, with an upscale, open-air shopping center nearby. The shopping center will consist of about 25 high-end, small specialty stores and restaurants.
Conroy said the plans for the Saks property will be submitted to city officials this spring and construction will begin as soon as the plans are approved.
"The current store is not configured the way we would like it to be," said Kendrick, adding that the new store will be 140,000 square feet, about 20,000 square feet larger than the existing one.
Across the street from Saks, The Westchester, a new mall anchored by Nordstrom and Neiman Marcus, is scheduled to open March 17, on Bloomingdale Road.
"I think we'll be a beneficiary of The Westchester," Kendrick said. "The mall is bringing retailing back to that whole area. We are a destination store."

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