Raleigh Stores Corp.'s purchase of the Garfinckel's chain has renewed speculation about the future of Garfinckel's, creating what might be called a $95 million mystery -- so named because of the acquisition cost for the 10-store specialty chain. Not surprisingly, most of the speculation centers on the future of Garfinckel's flagship store in downtown Washington.

Will Raleigh's continue to operate a Garfinckel's store at the site in question, or will it redevelop the property as an office building? There's really not much of a mystery here. Logic practically dictates a decision to do both.

Raleigh's chairman, Neal J. Fox, has said through a spokesman that he never intends to leave the site at 14th and F streets NW. There's no reason to doubt that Fox won't keep his word. But there also is little reason to expect that he will be foolhardy enough to yield to sentiment to keep Garfinckel's flagship store intact with $95 million in debt staring him in the face.

Earlier this year, when Campeau Corp. of Canada indicated it was going to sell Garfinckel's and other divisions of its Allied Stores Corp., some investors who were interested in acquiring the Garfinckel's chain hinted strongly that they wanted to redevelop the building at 14th and F for use as an office complex. D.C. officials became so concerned about losing a major retailer in the central shopping district that some considered having the Garfinckel's building designated as a historic structure.

Raleigh's purchase of Garfinckel's has apparently lessened official concern about the chain's continued presence in downtown Washington. Fox, after all, is a retailer, not a real estate developer. That's not to suggest, however, that his interest lies in one and not the other. After all, prominent real estate developers continue to acquire major holdings in the retail industry.

Retailing is what Fox knows best, however, and it should come as no surprise if he moves soon to reconfigure the space at Garfinckel's main store. One doesn't have to be an expert to conclude fairly quickly that the Garfinckel's building at 14th and F is underutilized.

Indeed, the chain already has more selling space than it apparently needs. Even its suburban stores are, for the most, grossly oversized. The Landover Mall and Springfield Mall stores, for example, look more like huge statuary halls than retail outlets. Merchandise displays in both stores are very neat and artfully laid out but seem only incidental to the vast amounts of space around them.

Even a novice in the retail industry knows the importance of sales per square foot to profits. Garfinckel's obviously hasn't been getting the most out of the space that it has, if the flagship store is an accurate guide. If Hecht's, one of two leading Washington department store chains, doesn't need but four floors to sell a considerably wider assortment of merchandise in its downtown flagship store, then it should be obvious that Garfinckel's doesn't need eight or more floors to sell less.

Garfinckel's, in retail parlance, is a specialty store. Typically, its merchandise lines don't include the wide assortment of soft goods, furniture and appliances usually found in a department store. As a specialty retailer, it opted long ago to sell a more limited assortment of merchandise, primarily upscale men's and women's apparel, jewelry, china and fine gifts.

Indeed, many of the same famous names in the apparel industry can be found in Raleigh's and Garfinckel's stores.

Fox can be expected, then, to make some changes that are likely to result in some consolidation.

Moreover, he is about to add even more selling space to the corporation's operation with a Raleigh's outlet in the Potomac Mills discount mall in Prince William County.

Raleigh's intends to make more efficient use of retail space in its regular stores by consolidating merchandise tabbed for special sales and shipping it to the Potomac Mills outlet, employes told a customer last weekend.

If better utilization of space is one of Fox's goals -- and there is every reason to believe that it is -- then it's probably safe to assume that he isn't about to sit on expensive, underutilized space, especially in one of the country's hottest office markets.

Fox has already demonstrated his understanding of real estate values in this town. Witness the decision to move the Connecticut Avenue Raleigh's from a modern stand-alone structure to a temporary location across the street while the old site is being redeveloped to accommodate an office/retail complex that will house a new Raleigh's.

Redevelopment of the Garfinckel's building at 14th and F not only would fit the mold that was designed for the Raleigh's at Connecticut Avenue and DeSales Street NW, but also would make eminent sense. In short, Fox could keep his word, retain a Garfinckel's store at 14th and F and still develop a substantial amount of primary office space at that location.

It's really the only business decision that would make sense, short of converting Garfinckel's into a much larger, more diversified and competitive retail company.

Given the $95 million price tag for the Garfinckel's chain and less than a compelling need for the excess retail space in its flagship store, there's little mystery to what Fox is likely to do