The repercussions of Saks Global filing for bankruptcy protection are reaching the local level in New Jersey, possibly imperiling a large mixed-use redevelopment project that includes a vacant Lord & Taylor store.

New York-based Saks Global is the developer that's been spearheading One Westfield Place, a project unveiled in September 2022 for North Avenue in downtown Westfield, a leafy and affluent suburb. The redevelopment entails the adaptive reuse of a freestanding 140,000-square-foot former Lord & Taylor as well as ground-up construction. The project stretches to include an area near a train station and adds office and retail space, multifamily units and more parking to the town.

The project was initiated by what was then called HBC and its Streetworks Development unit. HBC acquired Neiman Marcus Group in December 2024 for $2.7 billion, creating the new company Saks Global. It filed for Chapter 11 bankruptcy protection in January and is looking to reject leases for a number of closed Lord & Taylor stores — including the one in Westfield.

That creates uncertainty about One Westfield Place's future, although local officials said they plan to hold Saks Global to the commitments that its predecessor HBC made.

The proposed Westfield redevelopment was the subject of various public hearings and even sparked litigation from opponents of the project. The redevelopment plan ended up being downsized somewhat.

The town of Westfield has been closely following the ongoing financial reporting regarding Saks Global, parent of SW Westfield — formerly known as Streetworks — and its related entities, in close coordination with its redevelopment and legal teams, according to Mayor Jeremy Berman.

"The most recent news of the Chapter 11 bankruptcy filing is unfortunate but not surprising, and I remain firmly committed to holding all developers accountable to their obligations to Westfield and ensuring that we remain financially protected above all else," Berman said in a statement to CoStar News. "This commitment includes using all of the rights and privileges detailed in our legal agreements as we continue to evaluate our options."

The Chapter 11 filing includes not only Saks Global but also SW Westfield and the eight limited liability corporations that were established for the One Westfield Place project, according to the mayor.

"Our redevelopment attorneys are working closely with their colleagues that specialize in bankruptcy law to assess the impacts on the One Westfield Place project, and the full Town Council will work together to determine the appropriate next steps under our agreements with SW Westfield," Berman said.

Saks Global didn't immediately respond to an email from CoStar News on Friday seeking comment. And Kim Brennan, a Cushman & Wakefield managing director who is the listing agent for the office component of the redevelopment, declined to comment.

In its Chapter 11 filing, Saks Global is seeking approval to reject 26 unexpired leases, all but one of them for former Lord & Taylor stores, including the location in Westfield. Those leases are held by a joint venture formed in 2015 between the retail company, then called HBC, giant mall landlord Simon Property Group and other investors, according to court documents.

Saks Global owns about 62.4% of the equity interests in the joint venture. Each of those properties has been leased back to Saks Global "pursuant to portfolio operating leases, with an initial term of 20 years" with several extensions, court documents said.

Lord & Taylor entered into individual, triple-net master leases in 2015 for the properties, leases that included a 2% annual increase in base rent and were guaranteed by then-HBC, according to Morningstar Credit Analytics.

The ratings firm recently downgraded its outlook on the loan tied to the joint venture to be "under review with negative implications." There's a $428.1 million commercial mortgage-backed securities loan on the joint venture's retail property portfolio.

"Given the recent bankruptcy filing, it may take time for the full scope of information necessary to determine credit-ratings impact to be available," Morningstar said.

Berman discussed the redevelopment at a late January Town Council meeting.

"The council remains focused on protecting the town’s fiscal health, limiting risk to taxpayers and ensuring that any outcome is realistic, sustainable and aligned with the long-term interests of the community," the mayor told residents. "As I’ve mentioned, bankruptcy law is complex, and not every claim or assumption circulating publicly reflects the full picture. We will share additional information as it is legally appropriate to do so."

But opponents of the redevelopment have voiced their concerns, local news outlet Patch.com reported.

"There are now even more urgent and serious questions regarding the ability of Streetworks and/or associated LLCs to fully finance and complete this massive development project," the Westfield Advocates for Responsible Development said in a statement.

"Among our primary criticisms has always been that non-competitive procurement and negotiation with Streetworks did not result in the best project for Westfield at the (still) publicly owned train station lots," the group said.