Will Neiman Marcus survive long enough to open in Walnut Creek?

Not an unreasonable question to ask, considering that, earlier this month, the Dallas-based retailer reported a net loss of $509.2 million for the 2008-09 holiday shopping season (the 13 weeks that ended January 31).

It was the first time, since Neiman Marcus began disclosing its quarterly results in 1994, that the luxury department store chain had suffered a holiday season loss. These results, the Wall Street Journal says, "reflect how luxury retailers are scrambling to adjust to dramatically leaner times. ... The six-year boom in luxury goods came to a screeching halt last fall, as wealthy shoppers cut back on their purchases of designer clothing and other pricey items."

One retail expert forecast a drop of as much as 15 percent in global luxury consumption in 2009, compared with last year.

Sol Henik, a Walnut Creek City Council candidate in 2006 and 2008 and a high school math teacher with the Mt. Diablo Unified School District, thinks that Neiman Marcus would be a "great addition" to Walnut Creek's retail scene. Still, he has raised questions about how exactly the parking lifts would work in the Broadway Plaza garage.

And, his "most pressing concern" is the long-term economic prospects for Macerich, the owner of Broadway Plaza. He wonders about the city and Macerich putting so much effort into bringing a (now) struggling department store chain to Broadway Plaza. That's because he, too, has been following news about Neiman Marcus' financial struggles.  

He sent the following e-mail to Walnut Creek City Council members and city staff. He is sharing it with Crazy in Suburbia:

Dear sirs/madam,



On Sunday, March 8th, I sent you an email regarding my concerns with the relationship between Macerich, Neiman Marcus and the city of Walnut Creek . I have not yet seen or heard a reply. The following is an updated version of my continued concerns:

I attended the March 5th Macerich/Neiman Marcus meeting and have been following the developments for some time now. As a Walnut Creek resident I'd like to voice my opinion and concerns.

 I believe that NM coming to Broadway Plaza could be a great addition to Walnut Creek and BP. I actually do believe that NM would fit quite nicely with the other high-end retail and restaurants in the downtown area and, would hopefully provide a much needed spark/stimulus to Walnut Creek 's economy. 

Furthermore, I also don't think that parking will be as much of a problem despite all the parking pessimism in Walnut Creek. I truly believe that Macerich/BP will do everything in their power to make the shopping experience as less stressful as possible.

My only concern with the parking would be the car lifts and valet parking. Will it work? How will it work? How much will it cost (Valet)? How would this affect traffic flow? How would this affect parking? What long term affects would this have on Broadway Plaza parking/traffic flow? What would the impact be during holiday shopping?



My most pressing issue here is Macerich itself. Approximately 12 months ago, Macerich was a $5-Billion company. Today it stands about $448 million. Macerich has lost about 93% of their value in that span as its stock price hit a fresh new 52 week low today.

My questions are:
1. What realities are there of Macerich surviving as a company?
2. Will Neiman Marcus still come to Broadway plaza even if Macerich files bankruptcy?
3. What problems will Broadway Plaza have if Macerich files for bankruptcy?
4. What would happen to Broadway Plaza & Walnut Creek if Macerich is bought out?
5. Is Macerich a solvent company?
6. How much debt is Macerich carrying and will it/does it pose real problems going forward for Broadway Plaza ?
7. How can Macerich continue to pay out its dividend and remain a viable/solvent company?

Thank you,
Sol Henik