Nordstrom Rack is coming to downtown Minneapolis.
After nearly two years of looking for the right spot downtown, Nordstrom Inc. has zeroed in on the former Gap store space in IDS Center on Nicollet Mall, three people with knowledge of the deal said Tuesday. One described the deal as “imminent.”
In addition to the ground-level space, the lease will include retail space in the basement that used to house a T.J. Maxx store. A Nordstrom Rack spokeswoman said that the company was not ready to share any news but that it “certainly has interest in the area.”
It’s a prime retail space in the city’s premier building. The skyway system and street-level entrances at IDS bring thousands of people through its Crystal Court shops and restaurants during the workweek.
Nordstrom Rack is owned by the same company as the department store Nordstrom and offers similar brands but at significantly discounted prices, sometimes up to 70 percent less.
A small percentage of The Rack’s merchandise comes from full-price Nordstrom stores. Most is separately ordered from some of the same brands that are found at the full-price stores.
As of March, there were 118 full-price Nordstrom stores and 197 off-price Nordstrom Rack stores in the United States, according to a quarterly filing to stock regulators by the Seattle-based parent company.
Nordstrom Rack is the company’s fastest-growing business. In 2005, The Rack accounted for just 8 percent of the company’s sales. By 2015, The Rack’s sales had climbed to 28 percent of the total, according to a Nordstrom investor presentation in March. “We are continuing our plan to accelerate the number of new Nordstrom Rack store openings,” the company said in the filing.
Nordstrom, known for being tight-lipped about expansion plans, has gradually been more public about its interest in downtown Minneapolis. When Blake Nordstrom, co-president of the company, visited the Twin Cities last year, he called the downtown market “very attractive.”
The new Nordstrom Rack could be open in IDS by next spring, according to the people with knowledge of the deal.
Nordstrom Rack had considered space in City Center — kitty-corner from IDS — but Sports Authority had already made a deal for the space. With Sports Authority now embroiled in a high-profile bankruptcy case, that lease is in limbo.
Several major national retailers have recently committed to the Nicollet Mall, now undergoing a major reconstruction effort. Walgreens opened a new, and much bigger, multi-floor store in Gaviidae Common last year, and Saks Off 5th, the outlet store of Saks Fifth Avenue, reopened a new Nicollet Mall location in City Center last month, just across the street from its former spot.