Executive Summary
If you follow luxury industry news, you have likely encountered no shortage of opinions about Saks Global.
Over the past month, social media threads, vendor whispers, executive commentary, and industry analysts have all weighed in—some declaring the death of the American department store, others defending the inevitability of restructuring. The noise has been loud.
For our second podcast episode, we step back from the headlines to ask a more disciplined question:
After months of chaos, what actually happened and what must happen next?
At the center of the debate lies a more uncomfortable thesis:
Was Saks Global undone by market forces or by a real estate-driven financial strategy that treated retail as secondary?
Key Insight
The Richard Baker Model: Real Estate First, Retail Second
At the center of Saks Global’s collapse is the controversial leadership legacy of Richard Baker. Critics argue that Baker’s historical playbook prioritized monetizing real estate assets over strengthening retail operations.
Across multiple acquisitions—from Lord & Taylor to Galeria Kaufhof—observers note a recurring pattern:
- Acquire retail assets with valuable property holdings.
- Extract value through property sales or lease monetization.
- Increase leverage against the operating business.
- Exit amid retail deterioration.
In the case of Saks Global, the sale of underlying real estate assets to service debt reinforced a perception that the “dirt beneath the store” carried more weight than the client inside it.
To be clear: real estate optimization is not inherently flawed. Many retailers responsibly leverage property assets. The issue arises when financial engineering outpaces retail stewardship.
Luxury retail is not a passive asset class. It is a trust-based ecosystem between brands, vendors, employees, and clients. Once that trust fractures, scale offers little protection.
The Path Forward: Merchant, Not Mechanism
Geoffroy van Raemdonck returns as CEO to lead restructuring with credibility earned from navigating Neiman Marcus through Chapter 11 in 2020. But this moment requires more than balance sheet stabilization.
It demands a philosophical shift:
- From extraction to stewardship.
- From financial complexity to operational clarity.
- From real estate leverage to customer equity.
Luxury in 2026 is not about square footage—it is about emotional equity.
The Strategic Question
Saks Global now faces a defining choice: Will it be remembered as a cautionary tale of real estate arbitrage—or as a restructured institution that rediscovered what it means to be a merchant? The next twelve months will determine which narrative endures.