Consumers have been forced to make hard choices in the wake of lingering inflation. The combination of higher costs and expensive borrowing rates has made shoppers more hesitant to swipe their credit cards and pay off expensive purchases over time.
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That’s been a hard pill for retailers to swallow. Retailers were struggling with declining traffic before inflation started taking a toll. And last year alone, more than 7,300 U.S. stores closed down, according to Coresight Research.
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But 7,300 closures may read like a drop in the bucket compared to the 15,000 stores Coresight anticipates closing in 2025. And those stores may not be limited to underperforming locations.
In January, Macy’s announced that it would be closing its San Francisco Bloomingdale’s location. And earlier this year, Nordstrom confirmed plans to shutter two Massachusetts locations — one in January and the second in March.
A growing number of retailers are closing underperforming locations to focus on digital channels. This allows them to reach a wider customer base and shed costs simultaneously, making it a strategic move at a time when consumers are increasingly opting for the convenience of online shopping.
A flagship department store is closing for good.
An iconic Dallas department store says goodbye
A broad decline in spending and a shift to online shopping is also impacting luxury stores. Neiman Marcus has long been a respected name in high-end retail. But in February, it announced plans to close its flagship store in downtown Dallas.
Interestingly enough, though, Saks Global, which owns Neiman Marcus, cited a lease dispute as the reason behind the store’s closure — not poor performance. And in the weeks following its closure announcement, Dallas city officials put the pressure on, urging the legendary retailer to maintain its downtown presence.
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But on Mar. 4, Saks Global confirmed that the decision to shutter its flagship store in Dallas is final.
A Saks spokesperson said, “The Dallas Consortium’s ongoing tactic of using the press to pressure us into changing our strategy in Dallas is highly unproductive…Our decision to close the Neiman Marcus Downtown Dallas store is final and we are moving forward as such.”
Neiman Marcus shifts its focus
Almost 100 years ago, Neiman Marcus signed a 99-year ground lease on a plot of land in downtown Dallas owned by C.C. Slaughter. That lease expired in January but was extended until March 31.
Saks announced in a previous release that it had attempted to reach a reasonable agreement with Slaughter Partners on that lease. Those talks were said to have dated back to 2011.
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In November 2024, Saks tried to get the city to help negotiate a new lease. But those talks were unsuccessful.
A spokesperson for Saks said the situation is “far more complicated” than it might seem and is set on the closure.
The company isn’t looking to cut ties with Dallas, though. Rather, it intends to invest in a $100 million renovation at its NorthPark Neiman Marcus store.
Jennifer Scripps, president and CEO of stewardship organization Downtown Dallas, Inc., confirmed that while the city is sad to lose the one store, it’s happy to see that Neiman Marcus isn’t shrinking its footprint so much as focusing on growth in another section of town.
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By revamping its NorthPark location, Neiman Marcus is hoping to attract younger consumers. But it faces challenges at a time when luxury shoppers have more options than ever for making purchases.
As of early January, Neiman Marcus had 36 locations across the U.S. Saks has not announced plans for further closures at this time.
Saks acquired Neiman Marcus in late 2024 to strengthen its hold in the luxury retail space. The company’s assets now include Saks Fifth Avenue, Neiman Marcus, Bergdorf Goodman, and Saks Off 5th.Â
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