Saks’s Ability to Tap Real Estate Is Undermined by Market Drop
Bloomberg reports: Saks Inc. Chief Financial Officer Kevin Wills told investors the unprofitable luxury retailer has “very valuable” real-estate assets it could tap to raise money if needed.
Easier said than done. Plunging real estate prices and tighter credit markets would make it difficult for New York-based Saks to harness the value of its properties, according to Dan Fasulo, managing director of Real Capital Analytics; Richard Hastings, who tracks the consumer industry for Global Hunter Securities LLC; and retail analyst Patricia Edwards.
“There is no way in a short period of time that they can monetize their real estate and say they are a healthy company,” Fasulo said. “Retail real estate has probably been the worst performer.”
Sales of properties in the U.S. retail sector plunged 74 percent in 2008 from a record the previous year, according to Real Capital Analytics, a real estate data provider.
“The luxury segment of commercial real estate got hit exceptionally hard,” New York-based Fasulo said.
View the full article on Bloomberg: Saks’s Ability to Tap Real Estate Is Undermined by Market Drop
Posted by: Nina Turner