One of downtown Salt Lake City's largest retailers is closing its doors, creating yet another vacancy on Main between 100 and 200 South.
The downtown Old Navy — open for less than three years — will close before month's end, leaving another 37,443 square feet of Main Street retail space empty. The national chain occupied the fourth largest downtown retail space.
Employees at the store, which opened Aug. 21, 2000, say they were told at an early morning meeting last week that the store will close July 24, and The Gap Inc. spokeswoman Claudia Hawkins said the store will be abandoned by month's end.
"We indeed are closing that store. Our vacate day for that store is July 31," Hawkins said.
The decision to close the store was part of The Gap Inc.'s continual review of low-performing store locations. The Gap Inc. owns Old Navy, Banana Republic and The Gap.
"As part of our ongoing business strategies, we're constantly reviewing leases and looking at stores and basically we just make a determination at that point on whether to keep them open," Hawkins said. "While I can't give you specifics on that particular location and the employees, I can confirm for you that indeed we will be closing."
Also last week, Boyer Co. met with officials from The Gap Inc. and the topic of Old Navy moving to The Gateway development was discussed, Gateway project manager Jake Boyer said.
However, Boyer emphasized it was The Gap Inc., which already operates a Banana Republic and The Gap at The Gateway, that initiated conversations about Old Navy.
"In the meeting with them last week about other issues, Old Navy did come up," Boyer said. "I don't know what their status is on Main Street, the only thing I know is that they are extremely unhappy with the store on Main Street. They were just kind of exploring if there were other options at The Gateway."
Boyer informed the Gap representatives that the city has imposed financial penalties on Boyer Co. if it brings businesses already on Main Street to The Gateway, a sprawling mixed-use mall Boyer built four blocks west of Main Street downtown. Unless those financial penalties are lifted, Boyer said Old Navy would not be welcome.
"We would have to have those penalties lifted or we couldn't do the deal," Boyer said. "We did not approach them about Old Navy. The topic came up from their side rather than ours."
Seattle investor Gene Horbach, head of E&H Properties, which owns the building that houses Old Navy, said he had not heard the store was leaving.
"I don't have any information about that," he said.
Horbach said he had heard rumors for months that Old Navy was struggling and was ready to leave. However, he recently contacted Old Navy and representatives said they weren't leaving.
"They actually denied it," Horbach said Thursday. "They said their business has been improving."
Old Navy has a lease with E&H for another eight years that it will have to continue to pay, Horbach said.
While he couldn't believe Old Navy was leaving, Horbach — a major financial supporter of Mayor Rocky Anderson's re-election bid — lamented the current status of Main Street downtown.
"Main Street is really in a bucket. . . . This negative news with the downtown and Main Street just contributes to the misery of everybody," he said. "All you have to do is drive through it and see how many spaces are vacant.
"Nothing is moving," he continued. "The rates are down below economic values. We need help. We need some positive news. . . . Bring me some tenants."
In February Horbach requested a $6 million low-interest loan from the Salt Lake City Redevelopment Agency to put a nightclub with two restaurants and a cultural museum in the buildings directly south of Old Navy — at 115, 125 and 127 S. Main — which Horbach also owns. Horbach hoped the development would breathe life into the area surrounding Old Navy, but the loan request was denied.
Employees at the downtown store, who were told not to talk publicly about the closure, did tell the Deseret Morning News that the store did not sell enough merchandise to stay open.
While the downtown store, 107 S. Main, had served as Old Navy's regional headquarters, other Old Navy stores in Salt Lake City on 400 South and in Sugar House turned better profits, the employees said. The half-dozen employees who spoke with the Deseret Morning News said increased competition from The Gateway and a perceived lack of downtown parking contributed to the closure.
The employees said they were given opportunities to work at other area Old Navy, Banana Republic and The Gap stores.
Before deciding to shut down, managers had closed the basement level of the downtown store and cut jobs in an effort to stay profitable, employees said.
Meanwhile, prices at the closing store are on fire sale, with some collared shirts selling for $4.99 and T-shirts going for $2.99.
Old Navy's departure will leave all Main Street storefronts on the east side of the street vacant from 100 South to 135 South, where the Newspaper Agency Corp., which is moving to West Valley City, sits. Continuing on the east side from 135 South to 165 South, there are two more street-level vacancies. The street level of the Walker Center, which finishes out the block to 200 South, is also empty.
The west side of Main Street between 100 and 200 South is fuller but has a string of vacancies from 140 to 158 South. Other vacancies persist throughout the downtown Main Street corridor between 400 South and South Temple.
Citing poor sales, Nordstrom, also located on Main Street in the Crossroads Plaza mall between 100 South and South Temple, has said it will leave downtown when its lease expires in 2005. Company President Blake Nordstrom has said his company will either leave town altogether or move to The Gateway if city leaders relax zoning rules that currently prohibit department stores there.
Contributing: Josh Loftin
E-MAIL: bsnyder@desnews.com