Saks Fifth Avenue will close its San Diego store, located in the Fashion Valley Mall, by July 17.
This story first appeared in the May 4, 2010 issue of WWD. Subscribe Today.
The 81,000-square-foot unit has about 70 employees, who will be offered transfer opportunities or will receive severance packages.
“Store-closing decisions are never easy, but are necessary from time to time,” Stephen I. Sadove, chairman and chief executive officer of Saks Inc., said Monday. “The planned closing of our San Diego store is consistent with our strategy of focusing our resources on our most productive stores.”
In March, the company said its men’s and women’s units in Portland, Ore., also will close in July.
According to Sadove, a handful of stores will close over time. He said the lease in San Diego was soon to expire, facilitating the closing. The store opened in 1995.
Saks Inc. operates 53 Saks Fifth Avenue stores, 55 Saks Off 5th stores and saks.com.
Saks ramped up expansion in the Nineties, when it was owned by Investcorp and wanted to demonstrate a growth story in advance of going public. The company merged into Proffitt’s Inc. in 1998 and soon after started publicly trading under the symbol SKS. The luxury chain continued to open a few stores under Proffitt’s management.
This year, Saks is showing an improved performance, though results have been dragged down by certain stores that operate in areas lacking the customer base to support them, or in the right markets but the wrong mall. Also in some cases, Saks took on high rents in exchange for getting landlords to support build-outs. With several stores signing leases in the late Nineties, some leases will come up for renewal over the next several years.
The company has signed a letter of intent to open a store in Puerto Rico and is waiting for the developer Taubman Centers Inc. to proceed. Saks also previously revealed intentions to open a store in Yonkers, N.Y., but has decided not to go forward with that unit.