Luxury retailer Neiman Marcus is closing its flagship store in downtown Dallas where it has sold luxury goods for more than a century after being unable to reach a new lease agreement for the real estate.
Neiman Marcus received "a notice from a landlord to terminate our occupancy," which is "forcing us to close" the store at 1618 Main St., beginning March 31, a spokesperson representing the parent company Saks told CoStar News in an emailed statement.
Saks Global finalized its acquisition of Neiman Marcus Group for a total enterprise value of $2.7 billion at the end of December. Each of the brands operating under Saks Global such as Neiman Marcus, Bergdorf Goodman, Saks Fifth Avenue and Saks Off 5th are continuing to serve customers under their own names.
Neiman Marcus has been negotiating for "more than a decade" with the landlord of the downtown Dallas store, according to the Saks Global spokesperson. Dallas County's latest property tax rolls list Neiman Marcus Group Inc. as the property owner of the downtown Dallas store. Saks Global didn't immediately respond for more details about the landlord negotiations and the parties involved.
The announcement of Neiman Marcus' upcoming departure from its downtown Dallas store comes days after Saks Global told the landlord for Neiman Marcus' headquarters at Cityplace Tower in Dallas that it planned to exit a corporate office lease spanning three floors.
Saks Global is consolidating corporate office space at its Brookfield offices in New York and closing Neiman Marcus' office hubs in New York and Dallas. The Dallas office at Cityplace Tower opened less than two years ago and was built to promote the company's remote-first hybrid environment, officials said when it opened in 2023. However, usage of the Dallas office averaged only 11 days per year, the Saks Global spokesperson told CoStar News last week.
Both the office and retail leases Neiman Marcus is exiting in Dallas could impact a $5.25 million economic incentive agreement the company has with the city of Dallas. Dallas' city council authorized the incentive in 2022 to Neiman Marcus to support the retention and expansion of its global headquarters in Dallas, city spokesperson Richard Ericson told CoStar News in an email. To date, the city has paid nearly $98,000 to reimburse for permitting fees in 2023, with the city "monitoring discussions between Neiman Marcus Group" and the landlord of Cityplace Tower, he added.
"In the event of a default, the city has the right to recapture the permitting fee reimbursements paid to date and Neiman Marcus Group would forfeit all remaining incentives," Ericson added.
Saks Global did not respond immediately to CoStar News on what might happen to its office space on the upper floors of the flagship store in downtown Dallas.
"This location has been a beloved institution in the community for more than a century, and we are disappointed to be losing a piece of Neiman Marcus history," the Saks Global spokesperson said in the firm's emailed statement. "For our impacted team members, transfer opportunities to nearby Neiman Marcus locations will be offered where possible, and those who are eligible will be offered appropriate separation packages."
Beyond its flagship downtown Dallas store, Neiman Marcus also has a few North Texas locations at NorthPark mall in Dallas, Willow Bend mall in Plano, Texas, and a location in Fort Worth, Texas. It wasn't immediately clear how many jobs would be impacted or where the store's employees might relocate.
Saks said, "Dallas is an important market for us," and they remain "committed to upholding the Neiman Marcus' legacy there," with plans to invest $100 million renovating its NorthPark store, in a move to "offer a new level of luxury fashion and service," at one of its store locations.
David Zoller, executive vice president at Texas-based retail real estate brokerage Weitzman, said the departure of Neiman Marcus from downtown Dallas will mark the "end of an era" that began in Dallas in 1907 when the first store opened. That initial store burned down in a fire in 1913, and the current flagship store opened nearby in 1914, according to Neiman Marcus' website.
"It's a big loss to the retail industry," said Zoller.