Neiman Marcus Closing 188K SF Hudson Yards Outpost
By Nicholas Rizzi July 24, 2020 10:30 am
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Luxury retailer Neiman Marcus will close its 188,000-square-foot Hudson Yards store a little more than a year after it opened as part of its bankruptcy proceedings, according to court documents.
Neiman Marcus filed a notice yesterday in a Houston court that it would shutter the Hudson Yards outpost along with three other Neiman locations and 17 Neiman Marcus Last Call storefronts, including the one at 210 Joralemon Street in Brooklyn. It does not plan to close its Bergdorf Goodman shop at 745 Fifth Avenue.
“Customers are and will continue to shop differently than they did prior to the pandemic,” a spokesman for Neiman Marcus said in a statement. “A physical location in Hudson Yards is no longer an ideal space for us given the preponderance of restaurants and future office space in that mall.”
“Instead, we are purposefully focusing on the unique relationships we already have with our loyal luxury customers at Bergdorf Goodman, and we will continue to serve our Neiman Marcus customers through our digital selling channel and our other tri-state area Neiman Marcus stores,” the spokesman added
The closures were first reported by The Dallas Morning News.
Hudson Yards developer Related Companies told Commercial Observer before the decision was finalized that it planned to convert the space into office use, dubbed “The Workshop at Hudson Yards,” when Neiman Marcus leaves.
“We have talked to all of our tenants and as many others as possible,” Related CEO Jeff Blau told CO. “The conversion into office is just incredible.”
Related has also been marketing another nearly 192,000 square feet of retail in the mall, about 40 percent of the total project, to office tenants.
Women’s Wear Daily previously reported that social media giant Facebook — which leased 1.5 million square feet in Hudson Yards last year — was in talks to take Neiman Marcus’ space, but Blau would not confirm specific discussions.
Neiman Marcus was the first tenant to sign on to Hudson Yards’ retail project and occupies space on the fifth through seventh floors of the seven-story mall.
However, the coronavirus pandemic — which tanked retail sales and forced stores to temporarily shutter — proved to be the death knell for struggling brands, with dozens filing for bankruptcy in its wake.
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 retailer secured a $675 million loan from its creditors to continue operations during the proceedings while it tried to pare down about $4 billion of its debt during the restructuring process.
Before the bankruptcy, Neiman Marcus skipped out on millions of dollars in payments on its debts and furloughed most of its nearly 14,000 employees, Reuters reported. Standard & Poor’s analysts lowered the retailer’s credit rating into the “junk” category, noting it thinks “the company’s prospects for a turnaround are increasingly low,” according to Reuters.
