Saks Global said it’s sticking to its decision to close Neiman Marcus’ historic flagship store in Dallas — despite local business leaders saying they have solved a thorny dispute with a landlord of the century-old landmark.
The stated reason for Saks Global’s decision last week to close the store on March 31 was a bizarre beef over a 2,500-square-foot sliver of land under the down escalator of the nine-story department store.
Saks, which acquired Neiman Marcus in a blockbuster $2.65 billion deal in December, is “disappointed to be losing a piece of our history due to circumstances beyond our control,” Saks Global CEO Marc Metrick said in a memo announcing the store closure last week.
But a consortium of business groups brokered a last minute deal on Tuesday in which the landlord agreed to “donate” its ground lease to the city of Dallas with the group claiming now that the dispute is “under control,” according to a statement released by the group on Wednesday.
The so-called Dallas Consortium for the Downtown Neiman Marcus even suggested popping open a bottle of champagne with Saks Global honchos in Neiman Marcus’ fancy restaurant, Zodiac, next week.
Saks Global was unmoved.
“Given our role in the Dallas community, we are working to schedule a meeting with the Dallas Consortium, however, at this time, our plans to close the Downtown Dallas Neiman Marcus remain in place,” the Big Apple company said in a statement late Wednesday.
Previously, the company said the dispute with the landlord, Slaughter Partners LP, had been raging for 10 years and that Slaughter finally terminated its lease.
Slaughter Partners did not return calls for comment.
The Slaughter family held a 99-year lease in the block-long building. They were close with the Neiman and Marcus families who founded the retailer in 1907, according to the consortium.
The lease never generated more than $400 a month for Slaughter Partners, according to the consortium’s statement on Wednesday.
Saks Global owns a significant share of the building along with a group of several landlords, including Slaughter Partners, hold ground leases.
“I know that Dallas is ecstatic about this deal,” said Dallas real estate developer Shawn Todd who brokered the deal with landlord’s rep during a flight to Los Angeles last night. “The city says Neimans doesn’t need to worry about that rent.”
It’s not clear what Saks Global and the consortium will discuss next week as Dallas officials desperately try to preserve Neiman Marcus’ 117 year-old legacy in the city.
Metrick and chairman Richard Baker have been visiting Neiman Marcus’ 36 stores over the past several weeks.
On Tuesday Saks Global handed out pink slips to 5% or about 150 corporate staffers — many of whom worked in Dallas — as it merges the retailers and navigates a slowdown in luxury spending.
On the same day, the consortium held a press conference outside the department store and waved a copy of The New York Post, which first reported that Slaughter Partners’ stake in the building was the source of the landlord controversy.
“Can you imagine the blowback in New York City if Mr. Baker had closed Bergdorfs or Saks Fifth Avenue,” Todd said at the press conference. “I can assure you it would be a whisper compared to the response that Texans would have regarding this store.”
Todd also poked Metrick and Baker over a portrait of Neiman Marcus founder Stanley Marcus, which the executives found “abandoned” in the empty corporate offices above the store and flew it back to New York City this month.
The gold framed painting is in Saks Global’s downtown Manhattan headquarters “to ensure a piece of Neiman Marcus history and culture was represented in Saks Global’s headquarters,” the company said.
Todd asked them to return it, “so it can stand for another 117 years” in the Neiman Marcus store, he said at the press conference.
Saks Global declined to comment on the portrait.
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