Gone, but not for long.
Saks Off 5th, which closed its downtown Minneapolis location this month, said Tuesday that it will return in April 2016.
The outlet store will reopen in City Center, at the same intersection of Nicollet Mall and S. 6th Street, but across the street from its former location, marking a significant win for the city's downtown vibrancy.
"It's such a coup for downtown Minneapolis to keep that retailer," said Andrea Christenson, vice president at DTZ, the commercial real estate firm formerly known as Cassidy Turley.
The store will occupy two floors in the former Office Depot location, which closed last year. The 40,000-square-foot space is divided into a 24,000-square-foot space on the street level and 16,000 square feet on the skyway level.
"We're excited to announce that Saks Fifth Avenue Off 5th will remain in downtown Minneapolis," Jonathan Greller, president of outlets at Hudson's Bay Co., said in a statement. "This city has been a strong market for us, and Minneapolis City Center provides us with a vibrant location in which to serve our exceedingly loyal customers."
City Center is a prime downtown location that has been hamstrung in the past by concerns over loitering on its sidewalks because of a nearby busy bus stop. The property will also need significant renovations before the high-end retailer moves in.
Yet the site's central location offers Saks a visibility similar to its previous storefront at Gaviidae Common, but without being saddled with excess space.
"It's all going to have to be retrofitted to Saks' specifications," Christenson said, and, "I assume that Saks is going to be sensitive to having a functional space because that was a big issue with its last space."
City Center is the 250,000 square-foot retail portion of 33 S. 6th St. The complex is owned by San Francisco-based Shorenstein Properties, which includes a 50-story office tower, parking garage and the ground lease under the Marriott hotel that is owned by Host Hotels & Resorts.
Ronnie Ragoff, asset manager for Shorenstein, said she couldn't speak to specific changes to the building, but noted that Saks is "designing their space" and will occupy the entire former Office Depot space on the ground floor and a significant skyway-level footprint as well.
"Retailers want to be as condensed as possible on one floor, except in Minneapolis you want to be on two floors to capture the skyway," Christenson said.
The site is in the midst of a significant transition. Shorenstein is trying to sell City Center while actively recruiting new tenants.
"We believe that tenant interest will absolutely be enhanced as a result of this addition to the project," said Greller in a statement. Rumors have recently circulated that other high-fashion retail outlets may be interested in the space.
And while Ragoff wouldn't name a potential tenant, she confirmed they are close to a deal with another retailer to fill the 21,000 square foot space across from Saks.
"We are working on a transaction across the way for the vacant space that's been available for a long time," Ragoff said, adding, "It's not shoes."
Real estate and retail experts see this as a major win for downtown Minneapolis, which is experiencing a boom in the downtown residential population.
"This is a combination of a lot of positive things happening downtown all at the same time," said Tony Strauss, senior associate with the Minneapolis office of Colliers International, who has worked to lease the space.
"You've got billions of dollars coming into the market, you've got Nicollet Mall redeveloping and redefining the area, and you've got retail choosing to stay. That's a strong validation of downtown retail."
With Saks moving in, several other small vendors will be moving out. Both Greek Grill and Au Bon Pain are leaving City Center to make way for the new retailer, while Baja Sol and Leann Chin will move to other sites within the building.
Saks Fifth Avenue opened its full-line Nicollet Mall store 25 years ago and revamped it as an outlet in 2005 as department store retailing waned. It decided to close the downtown location more than two years ago. "The decision to close the previous location was made before Hudson's Bay Company acquiring Saks Incorporated [in 2013]," Tiffany Bourre, director of external communications for HBC, wrote in an e-mail.
Last year HBC opened a 28,000 square foot Off 5th location in the Twin Cities Premium Outlets in Eagan. Saks Off Fifth' former location in Gaviidae Common will be replaced with a Walgreens store that will be a "higher-end marquee" store format, according to a company spokesman.