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It’s the end of an era, some might say.
2026 might be the beginning of the end for some of New York City’s most beloved luxury department stores.
As of Wednesday, Saks Global, the parent company of Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman, has filed for Chapter 11 bankruptcy.
Before high-end shoppers go into a frenzy, it’s important to understand what exactly this means.
By filing for Chapter 11, the high-end department store conglomerate can take a breather to reorganize its finances and operations.
Saks was able to secure $1.75 billion in financing, which will allow it to keep its stores open for the time being and revenue from Saks being sold on Amazon also helps.
But before beloved shoppers get their hopes up, that money might go right out the window in order for Saks to settle its $3.4 billion debt, which is largely due to the Neiman Marcus acquisition that was finalized in December 2024.
To add insult to injury, Saks Global’s estimated assets and liabilities range from $1 billion to $10 billion, according to documents filed in the U.S. Bankruptcy Court in Houston, Texas.
Considering Saks Global operates approximately 70 luxury store locations across the U.S., as stated in court documents, it’s safe to say the retailer will soon be seeking to terminate some of its expensive leases and potentially shutter stores.
Already, nine Saks Off 5th stores closed across the country, with several in the tri-state area, including the Upper East Side (125 E 57th Street) location.
And earlier this month, word on the street was that Saks was thinking of closing approximately 20 stores across the U.S., according to WWD.
While major luxury brands like Prada, Dior and Gucci, which are all sold in these high-end department stores, won’t be largely affected by potential store closures since the majority of their sales are direct to consumer, it’s the small designers that will feel the pinch as a bulk of their revenue relies on store sales.
To make matters worse, some of the smaller vendors working with Saks Global are owed between $50,000 and $10 million, according to lawyer Joseph Sarachek, originally reported on by The New York Times, and they may only see pennies of it.
Since filing for bankruptcy, Saks Global will first have to pay back its bigshot investors, which means these smaller businesses will most likely only receive leftover chump change.
Brands aside, what can shoppers expect from this disappointing fashion news?
While it’s unknown which of these department stores, that have become NYC institutions in their own right, will shutter — empty shelves could indicate a major sale is in the near future before their doors are eventually shut.
When the main Saks Off 5th NYC location closed its doors, the store advertised massive sales up to 85% off, so it’s almost expected that other Saks Global stores that plan to close their doors will follow suit.
As of now, Saks Fifth Avenue (611 5th Avenue) has 70% off designer sale signs around the store. It’s unknown if these sales are linked to the bankruptcy news or if it’s simply a post-holiday get-rid-of-inventory plan.
Some shoppers even noticed a skeleton crew at this location, with many shopping assistants missing at checkout counters.
There is no news just yet on the operations of these stores’ online sites.
