Facebook Considering Neiman Marcus’ Hudson Yard Space
By Nicholas Rizzi June 22, 2020 12:06 pm
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Social media giant Facebook has been considering taking over Neiman Marcus’ 188,000-square-foot retail space in Hudson Yards, Women’s Wear Daily reported.
Facebook would convert Neiman Marcus’ store on the fifth through seventh floors of Related Companies’ seven-story Hudson Yards retail structure in Hudson Yards, WWD reported. A source told WWD that Neiman Marcus wants to ditch the store after it filed for bankruptcy in May and Related has been looking to get the luxury retailer out as well.
Spokespeople for Facebook and Related did not immediately respond to requests for comment.
A spokesman for Neiman Marcus said in a statement that the company was evaluating its stores as part of its Chapter 11 proceedings but did not specify the fate of the Hudson Yards outpost.
“Our restructuring plan is focused on alleviating our debt load,” a spokesman for Neiman Marcus said in a statement. “We are confident in the performance of our overall store footprint. In fact, stores that have been open for more than a year prior to COVID-19 are [per retail store] EBITDA positive. That said, we always assess our stores based on our footprint to ensure it is optimal to enhance revenues and overall profitability, as well as how each store can best support our omnichannel strategy. Any related discussions with landlords are confidential.”
Neiman Marcus filed for bankruptcy in May — the first major department store to do so during the coronavirus pandemic — with $5 billion in debt. The company secured a $675 million loan from its creditors to continue operations during the Chapter 11 proceedings and hopes to pair down about $4 billion of its debt in the restructuring process.
The Dallas-based chain — which also owns Bergdorf Goodman and Neiman Marcus Last Call — is expected to shutter some stores during its bankruptcy but has not publicly announced closing plans yet.
Neiman Marcus was the first tenant to sign on to the Hudson Yards’ retail project in 2019 but has reportedly been trying to get out of the deal after its bankruptcy.
Related and its partner Oxford Property Group started marketing Neiman Marcus’ space, along with some others in the retail complex, to office tenants earlier this month, Business Insider reported. The developers listed 380,000 square feet for rent in the mall, about 40 percent of the total project, according to Business Insider.
In November, Facebook signed a deal for more than 1.5 million square feet of office across three buildings the Hudson Yards mega-project and has been in talks to take more than 700,000 square feet in Vornado Realty Trust (VNO)’s Farley Post Office site.
Facebook — which recently announced plans to allow up to half of its staff to work remotely within the next five to ten years — is close to finalizing the deal at the Farley Post office, as Commercial Observer previously reported. It’s unclear if the Neiman Marcus space impacted those talks.
