Real estate sources have confirmed that Saks OFF Fifth has extended its lease for one year, beginning in February. The company was widely rumored to be giving notice about a departure from the 1001 State St. building, before officially giving notice in October.
The store stays for now. The property is managed by Radius Group.
State Street retailers have struggled with high lease costs and a drop in foot traffic as some customers shift their shopping habits to Amazon.com.
Macy’s left its space in the Paseo Nuevo Mall earlier this year. Several stores on State Street have also vanished, victims of high rents, fewer shoppers and the presence of homeless people.
Saks’ lease renewal is short-term, but gives the property owner more time to find a permanent tenant. Or maybe, Saks OFF Fifth will decide to stay even longer.
The decision by Saks to stick around, however, could offer hope for other big and small retailers trying to make a decision on whether to stay on State Street or move elsewhere. Prior to Saks OFF Fifth, the main brand, Saks Fifth Avenue, filled the building.
Institution Ale co-owner Shaun Smith stands near his Santa Barbara brewery’s controversial neon sign. (Joshua Molina / …
Institution Ale's Ryan Smith and son Shaun Smith at the family's new State Street location. Photo: Paul …
Summary of market insights and analysis from Q2 2019 South Coast commercial sales and leasing activity: Download the complete report here …