Saks Fifth Avenue officially pulls out of The Mall of San Juan after 2-year litigation
More than two years after shutting down, Saks Fifth Avenue has confirmed it will not reopen the only store it had in Puerto Rico at The Mall of San Juan, putting an end to a court battle with mall operator Plaza Internacional Puerto Rico.
The litigation began in October 2017, when Plaza International — the local arm of the mall’s owner, Taubman Centers — sued the luxury retailer for keeping it in the dark about recovery and reconstruction plans after Hurricane María ripped through Puerto Rico, and the store, on Sept. 20, 2017.
The court fight involved Saks’ parent Hudson’s Bay Company, which agreed to pay Taubman $26 million as a partial reimbursement of their previously received anchor allowance, in exchange for the termination of their obligations under their agreements.
Taubman now has full control of the 100,000 square-foot location. At one point during the judicial process, Saks had hinted at the possibility of reopening in June 2019, but that never materialized.
“The allowance reimbursement and value of the former Saks Fifth Avenue building and improvements exceeded the write-off of the book value of the anchor allowance and legal costs incurred in the third quarter, resulting in a $10.1 million net gain, which was included in non-operating income,” Taubman said in its third-quarter earnings release, which it will discuss with analysts in a call this morning.
Saks was one of The Mall of San Juan’s two anchor tenants, along with Nordstrom. Both made their debut in the local market when the upscale shopping center opened in March 2015.
