In what may be another sign of the struggling retail market, the Macy's store in downtown Minneapolis has been unable to find a tenant to fill the spot vacated in January by J.B. Hudson Jewelers.

Instead, the retailer will set up its holiday home trimmings merchandise in that space, starting Sept. 15. The Christmas decorations and other seasonal goods typically are on the store's fifth floor.

FAO Schwarz had eyed the vacated area, but decided it wasn't a good fit and instead moved into space last month on Macy's fourth floor. Upscale restaurants have come back for second looks, but still no lease is in hand -- despite the location at 770 Nicollet Mall, arguably the heart of Minneapolis. It's an area civic leaders have deemed the key to creating a unique shopping district that will draw visitors downtown.

Macy's officials, in the Twin Cities for store visits and to partake in Friday's Glamorama benefit concert and events, put a positive spin on it all, saying it will be nice to have something there after all these months.

"We've had a lot of requests for that space," said Mark Cosby, president and chief operating officer of Macy's East. "We're just sorting through what's the best thing."

J.B. Hudson spent 78 years at that site before opening a new store just a few blocks down Nicollet Mall at the Young Quinlan building.

JACKIE CROSBY