Leases for nearly 60 Saks Off 5th and Last Call stores that total 1.7 million square feet have officially gone on the block, with the sites touted as a chance for expanding chains to get locations in high-traffic retail corridors.
A&G Real Estate Partners said it has started marketing leases for a portfolio that spans 19 states and includes 54 Saks Off 5th and five Last Call stores. New York-based A&G is handling the sale in its capacity as real estate adviser to luxury retail company Saks Global, which in January filed for Chapter 11 bankruptcy protection.
That proceeding has already pushed two major Saks Global commercial mortgage-backed securities, or CMBS, deals into special servicing, putting about $1.7 billion in loans under credit review. That includes a $1.25 billion loan covering Saks Fifth Avenue's flagship store at 611 Fifth Ave. in New York that moved to special servicing in the past week, according to Morningstar Credit.
Saks Global is in the midst of closing nearly all its off-price Saks Off 5th stores, except for 10 of them, as well as the remaining handful of Last Call stores it has. Saks Global said it wanted to focus on the upscale retail sector and get out of the off-price business. Off-price retailers sell brand-name, designer or high-quality goods at major discounts, usually 20% to 60% lower than traditional department-store prices.
Bids are due in February and March, depending on the location, according to A&G's website.
The available leases will offer retailers looking to expand their store footprints a chance to open up shop in high-foot-traffic locations such as premium outlet destinations, open-air lifestyle centers, traditional malls and mixed-use properties, according to A&G.
Tight retail market
The 59 off-price stores with leases up for sale average 28,000 square feet, making 1.7 million square feet of space available in a tight market for retail space, said Emilio Amendola, co-president of A&G and leader of its real estate sales division, in a statement.
"These larger spaces are a strong fit for expanding brands in categories like footwear, sporting goods and off-price fashion and accessories," he said. "Landlords also are showing strong interest in taking back and repurposing these boxes."
Additional opportunities may be coming soon, according to Amendola.
The states with the most Saks Off 5th locations up for grabs are in California with nine while Florida and Texas both have six stores. There are two Last Call stores in California, two in Texas and one in Florida.
In addition to the loan for the Saks Fifth Avenue Manhattan store going into special servicing, there was also new servicer commentary released for a $428.1 million CMBS loan backing 15 former Lord & Taylor locations where the master lease was rejected.
That loan relates to a retail property portfolio held by a joint venture, known as HBS, that is led by Saks Global and includes mall landlord Simon Property Group and other third-party investors. The portfolio once had roughly twice as many stores as it does now.
Its servicer said the remainder of the properties should produce enough cash to cover interest payments, but the commentary added that a notice of default was issued and the forbearance that ran until next month was rescinded.
DBRS Morningstar placed all classes of the two CMBS transactions under review with negative implications last month.
Saks Global didn't immediately respond to an email from CoStar News on Friday seeking comment.
When Saks Global filed for Chapter 11 last month, it cited its struggles meeting debt obligations following its $2.7 billion acquisition of its luxury rival Neiman Marcus in 2024.
The bankruptcy exposes structural vulnerabilities in department store-backed CMBS deals. The HBS portfolio already weathered Lord & Taylor's 2020 bankruptcy that left 25 anchor boxes dark. The loan transferred to special servicing in July 2025 for imminent maturity default on its August 2025 due date.
The 12-story Manhattan flagship building loan carries particular risk. The $1.25 billion note is secured only by the leased fee interest, not the operating lease between Saks and the building owner. Annual ground rent totaled $96.2 million as of October 2024, according to DBRS Morningstar. The operating lease expires in December 2044.