Saks Reaches Settlement With Simon Property, Creditor Deal Clears Path for Chapter 11 Exit

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4.26.2026

Quick Facts

Saks settled a $7 million rent dispute with Simon Property Group covering stores in California and New York
The luxury retailer secured $500 million in exit financing as part of a plan to slash its $3.4 billion debt load
Saks plans to emerge from Chapter 11 bankruptcy this summer after closing 77 stores across all brands

Saks Global reached a settlement with Simon Property Group to resolve a contentious rent dispute and secured creditor agreements that clear major hurdles for its bankruptcy exit.

The settlement resolves Simon’s claims for $7 million in back rent for a Neiman Marcus store in Palo Alto, California, and a Saks Off 5th location at Woodbury Commons Premium Outlets in New York. Simon had also sought to terminate those leases.

Saks attorney Debra Sinclair said both agreements will be finalized and submitted to the bankruptcy judge in the coming days. The deals represent a breakthrough for Saks’ reorganization plan to eliminate its $3.4 billion debt load.

“Achieving this important milestone underscores the progress we are making on our transformation,” said Geoffroy van Raemdonck, CEO of Saks Global.

The company secured a $500 million financing commitment from capital partners. Saks’ chief restructuring officer Mark Weinstein said the company would be “dead in the water” without the new money to pay vendors and its 17,000 employees.

Saks filed for Chapter 11 protection in January after missing a $100 million interest payment. The company accumulated debt after its $2.7 billion acquisition of Neiman Marcus failed to generate expected synergies.

The retailer has announced plans to close 12 Saks Fifth Avenue stores, three Neiman Marcus locations, and 62 off-price stores. After closures, the company will operate 25 Saks Fifth Avenue stores, 35 Neiman Marcus stores, and two Bergdorf Goodman stores.

Since filing for bankruptcy, more than 650 vendors have resumed shipments covering over 90% of expected inventory for the first quarter of fiscal 2026. Customer spending per store visit has increased 6% and online sales rose 11% compared to the same period last year.

The company owes over $337 million to critical suppliers, including $136 million to Chanel and $26 million to Kering. Amazon, which invested $475 million in Saks, has objected to the bankruptcy financing, calling its equity investment “worthless.”

U.S. Bankruptcy Judge Alfredo Perez said the financing would give Saks a chance to stabilize its business and restructure its debt. The settlement with Simon also ends reciprocal easement agreements, giving the mall operator more flexibility to redevelop its properties.