Saks to Shutter Three New Jersey Stores, Cutting 69 Jobs Ahead of 2026 Bankruptcy
Luxury retail giant Saks Fifth Avenue is preparing to close three of its New Jersey stores and lay off 69 employees, according to recent public filings, as the company navigates a pre-arranged bankruptcy process set for early 2026.
The layoffs, effective May 4, 2026, were disclosed in a notice to the New Jersey Department of Labor. They coincide with the closure of three Saks OFF 5th discount locations in the state on January 31, 2026, part of a wider national shutdown of 54 such stores.
The move follows Saks's leveraged acquisition of rival Neiman Marcus a year ago, which saddled the combined entity with approximately $2 billion in debt. Court documents cite a perfect storm of inflationary pressures, reduced mall foot traffic, and tariff-related uncertainties that have chilled lending as key factors behind the financial strain.
"We are taking decisive steps to realign our business to better serve our luxury customers and drive full-price selling across our core luxury businesses," said Saks CEO Geoffroy van Raemdonck in a late-January statement. "With these actions, we will be well positioned to seize the greatest opportunities for long-term growth."
Not all Saks locations in New Jersey are disappearing. The flagship Saks Fifth Avenue store at the American Dream mall in East Rutherford—nestled among luxury neighbors like Gucci and Hermès—is expected to remain open. Analysts suggest such high-traffic, luxury-anchored locations are more likely to withstand the company's broader turmoil.
To fund operations during its Chapter 11 proceedings, Saks has secured $1.75 billion in debtor-in-possession financing. Van Raemdonck, formerly the CEO of Neiman Marcus, was appointed to lead the company through this restructuring as part of the bankruptcy deal.
Reader Reactions:
Michael T., Retail Analyst in Short Hills: "This is a painful but predictable consolidation. The debt load from the Neiman Marcus deal was immense, and the off-price segment is brutally competitive. Their survival hinges entirely on the health of the full-price luxury flagship model."
Linda R., Former Employee in Paramus: "It's devastating. Many of us have been here for years. They talk about 'realigning the business,' but that's just corporate jargon for real people losing their livelihoods. The executives walk away with packages, and we're left with pink slips."
David Schwartz, Morningstar Analyst: "Locations like American Dream, with its built-in tourist and luxury traffic, are the assets they must protect. The closures are a strategic retreat to preserve the core brand equity while shedding underperforming and costly liabilities."
Chloe P., Frequent Shopper in Hoboken: "It's sad to see the OFF 5th stores go—they had great finds. It feels like another sign that the traditional mall model is really struggling, even for the big names."
Daniel Munoz covers business, consumer affairs, labor and the economy for NorthJersey.com and The Record.
Email: [email protected]; Twitter: @danielmunoz100