Saks Fifth Avenue will close its women’s store in Manhattan’s Brookfield Place next month, after just over two years in operation, WWD has learned.
The three-level, 86,000-square-foot unit, at 225 Liberty Street, will close on Jan. 5.
“This Saks branch location was a test concept where we learned even more about how our women’s customers like to shop in New York City,” a spokeswoman told WWD. “We determined that their preferred format is a combination of our digital channels and our iconic Fifth Avenue flagship, where our grand renovation is creating an unparalleled luxury shopping destination. The decision to close this location was not easy and we intend to transfer as many sales associates to new roles as possible. We have no plans to close our Brookfield Place men’s store.”
Saks’ 16,750-square-foot, one-level men’s store in Brookfield Place, at 250 Vesey Street, opened in February 2017.
Brookfield Place is expected to soon announce a new retail tenant, which will occupy a significant portion of the Saks space.
Saks’ women’s store in Brookfield Place never developed any momentum, which could have partly been due to it being situated at the south end of Brookfield Place and not ideally located. It opened with a tightly edited assortment, devoid of shops-in-shop, and merchandised by lifestyle and with an avant-garde orientation. It’s smaller than most other Saks units, and has an unusual layout with a main-level rotunda space anchored by a large column containing the escalator and brass fins that radiate along the windows like veils.
There have also been reports that while traffic has been robust in Brookfield Place, most of it revolves around the food and beverage offerings and the outdoor recreation and dining facilities by the waterfront.
“Sales at Brookfield Place are consistent with some of the top-grossing shopping malls in the country,” a spokesman told WWD on Monday, disputing speculation that some stores have not performed up to satisfaction. “Luxury sales in particular,” the spokesman stated, “have been very strong on average. Excluding Saks, luxury retail sales has grown each year since we reopened Brookfield Place and have seen double-digit percentage growth in 2018.”
Regarding the tenant that will replace Saks, the spokesman said, “We are looking forward to announcing soon a new, amenity-focused tenant to take the majority of space Saks will vacate and are excited to continue to cultivate a uniquely dynamic and welcoming environment in Lower Manhattan that offers the best of food, shopping, culture and more.”
In 2014, Brookfield Place completed a $250 million renovation that brought in Bottega Veneta, Gucci, Louis Vuitton, Ermenegildo Zegna and Hermès, among several other tony brands, beating out Westfield World Trade Center, just east on the other side of West Street, in luring luxury tenants. Brookfield Place is located across West Street from the World Trade Center site in the Battery Park City neighborhood and includes five office buildings, the shopping center, the Winter Garden Atrium and a food court. There’s about 300,000 square feet for retail.
As recently reported by WWD, the mixed-use site, named after the parent Brookfield Properties, has been recasting itself as “a cultural center, a hub for the community.” The company has been actively programming events catering to families and the community to broaden its reach, and take a step away from being narrowly regarded as a bastion of luxury. Among the recent entries are Madewell and b8TA.
Brookfield Place is also home to the 400,000-square-foot U.S. headquarters of the Hudson’s Bay Co., which owns Saks Fifth Avenue. The relationship between HBC and Brookfield has facilitated the entry and exit of Saks Fifth Avenue from the center. The majority of the retail tenants have 10-year leases.
Saks considers the downtown location an experiment that didn’t work out. Despite the closing of the store, the luxury chain, overall, is doing well. In the third quarter of 2018, the chain reported that comparable sales grew by 7.3 percent, marking the sixth consecutive quarter of growth and highest since HBC acquired the brand in 2013.
Officials indicated that the focus is squarely on the massive renovation and reimagining of the Fifth Avenue flagship, which this year included the opening of the second-level beauty and jewelry areas, and last year’s opening of a designer floor on level three and The Collective and Advance contemporary areas on five. Next year, the main floor will reopen with a major handbag and leather goods statement, and a new floor for fine jewelry, called The Vault, will be launched, as well, one level below the main floor. Saks is creating a grand escalator that will link the lower, main and second levels.
Saks operates 42 stores. The Brookfield Place location has 120 employees. “We’re working to provide as many transfer opportunities as possible,” the spokeswoman said.
HBC has been weeding out weak stores and aggressively evaluating its real estate portfolio to monetize properties in order to reduce debt. The company recently sold off both a majority interest in its European retail operations to Signa Holdings which owns the Karstadt department store chain in Germany, and a 50 percent stake in its European real estate. Next month, HBC closes for good the Lord & Taylor flagship on Fifth Avenue and is expected to close on the $850 million deal to sell the property to WeWork. In addition, HBC is seeking to sell its Hudson’s Bay flagship property in Vancouver, Canada, but will continue to operate the store.
In October, the company orchestrated a deal in Vancouver’s Oakridge Centre where HBC agreed to relocate its Hudson’s Bay store in the center, which is being redeveloped, for $151.5 million. The money will be used to repay HBC’s revolving credit facility. HBC will receive an additional $21 million to outfit the new store, which is expected to open in 2023. HBC’s rent on the new store will be the same as it is now on the existing location, which will stay open during the redevelopment.