Dallas, Texas-based department store operator Neiman Marcus Group has contracted A&G Real Estate Partners to market the leases of four of its locations as it tries to raise funds as part of its ongoing bankruptcy proceeding, begun in the wake of the Covid-19 pandemic.
Having filed for Chapter 11 bankruptcy in May, the company has already begun the process of closing most of its Last Call stores and is now exploring the possibility of closing some of its namesake full-line locations.
The leases being marketed by A&G are for the following Neiman Marcus stores: 1275 Broadway Plaza, Walnut Creek, California; Mazza Gallerie, 5300 Wisconsin Ave. NW., Washington DC; 151 Worth Ave., Palm Beach, Florida; and Shops at Bravern, 11111 NE 8th St., Bellevue, Washington.
The leases’ expiration dates range from 2026 for the Palm Beach location to 2040 for the Bellevue store. All contracts contain options for extensions, with the lease for the Walnut Creek location offering the possibility of an extension into 2112.
In a release published by A&G on Tuesday, the contracts are described as “long-term, multiple-option leases,” with some locations being “particularly promising for conversion to hotel, office or residential use.”
Commenting on the news, a Neiman Marcus spokesperson told The Dallas Morning News, “we continue to assess our store footprint to ensure it is optimal to enhance revenues, overall profitability and our omnichannel strategy. This assessment may include marketing of leases for certain locations.”
“This is not necessarily an indication that we’re closing a particular store, but rather a way to monetize the value of the leases at these properties,” she added.
Following its Chapter 11 filing in May, Neiman Marcus secured approval for a $675 million debtor-in-possession (DIP) financing package in June in order to ensure the continuity of its business during bankruptcy proceedings.
The retailer, which is $5 billion in debt due to two leveraged buyouts in under 10 years, expects its post-emergence capital structure to eliminate approximately $4 billion in existing debt, with no near-term maturities.