UPDATED, 11:41 a.m., Sept. 19: Neiman Marcus is downsizing its soon-to-be flagship store in Related Companies’ massive Hudson Yards complex, according to a report in the New York Post. But representatives for Neiman Marcus are denying the report.
The Dallas-based luxury retailer, which signed a deal to anchor Related’s 1 million-square-foot complex in 2014, could be minimizing its planned 250,000-square-foot space by somewhere between 10,000 and 70,000 square feet, according to the Post.
Neiman Marcus, which is owned by private equity firm Ares Management, has seen declining sales for seven consecutive quarters, and like most retailers, has been struggling with decreased mall traffic and competition with online retailers.
A smaller Neiman Marcus could hurt Related, which is slated to open the complex in 2019. Related says the retail portion of its complex is 70 percent leased, according to the Post.
After the story was published, a Neiman Marcus spokesperson said in a statement that “the store was originally contemplated at 215,000 leasable square feet and, with construction well underway, we are now finalizing exact specifications for the store. We plan to make the layout of the non-selling space more efficient, while keeping the customer facing space and our sales projections in line with original plans.”
Neiman Marcus is one of several retailers who made big plans for flagship stores in Manhattan, before the retail market bottomed out. Nordstrom is building a seven-story flagship at Extell Development’s Central Park Tower, and Nike, Under Armour and Apple all have big plans for their Fifth Avenue stores.
The retailer was previously in talks with Hudson’s Bay, the parent company of Saks Fifth Avenue, over a potential sale, but the negotiation ended without a deal. It was also reported that the retailer was discussing a potential merger with Related, but no deal ever materialized. [NYP] — Chava Gourarie
This story was updated to include a statement from Neiman Marcus.