CoStar's Retail News Roundup: Oct. 18 - 24, 2009

CoStar's weekly column covering expansions, new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales, loans, shopping center development activity, personnel changes, sustainability, green building, and more in retail real estate.

E-mail this article

Print this article

By Sasha M Pardy

October 19, 2009

This is Disney Store now. What will it look like after undergoing the "Imagination Park" remodel?

This week in the Retail Roundup, CoStar reports on expansions or new concepts at All Saints and Disney Stores; closings, cutbacks, defaults, or bankruptcy news at Lowe's and Luby's; acquisition, merger, loan, sale, or IPO activity at Charlotte Russe and Tribeca; new retail development news in Houston and Western Michigan; personnel or corporate announcements at Inland Western, Marcus & Millichap, and Equity; sustainability and green building news at Macerich and ICSC; and more.

Did you miss last week's CoStar Advisor national retail story, "Drug Stores Trump Most Retail Categories on New Store Additions and Property Sales"? If so, click here to read the story

(Editor's Note: To keep up on happenings and trends in retail real estate, subscribe to CoStar's Retail News Roundup, a weekly column covering retailer expansions and new concepts, store closings, bankruptcies, cutbacks, acquisition, mergers, sales. new shopping centers, personnel changes, and sustainability. Follow this link for access to back issues of the roundup. In addition to appearing every week in the national news and retail news sections of our web site, you may also receive the Retail News Roundup for free via email by requesting to be added to the distribution list by contacting senior editor, Sasha Pardy at spardy@costar.com Also, click here to subscribe to CoStar's dedicated Retail RSS Feed.

EXPANSIONS / NEW CONCEPTS

British Fashion Brand, All Saints, Making U.S. Entry
British fashion brand, All Saints, is entering the U.S. retail market with its first stand-alone U.S. store in Los Angeles. In November, the company is scheduled to open a 7,500-square-foot store on Robertson Boulevard in Beverly Hills -- the retailer reportedly leased a space that had sat vacant for about one year since Arden Agnes B. closed shop there. In December, All Saints is expected to open a 7,500-square-foot store on Lincoln Road in Miami. And in spring 2009, look for a 13,600-square-foot All Saints flagship store at the convergence of Broadway and Spring Street in Manhattan.

All Saints currently operates 50 stores in the U.K., Belgium, Paris and Berlin and also sells its edgy, vintage-style apparel in department stores and online. In July, the company secured nearly $49 million in financing from Lloyds TSB Corporate Markets to give the company a platform to develop, innovate and expand its business.

Walt Disney Revamping its Disney Store Fleet
The Walt Disney Company has outlined a major remodeling plan for its chain of 340 Disney Stores. The new concept design, dubbed Imagination Park, is intended to give the stores a feel that more closely matches its Magic Kingdom theme park, creating retail destinations.

In an article with the New York Times, Jim Fielding, president of Disney Stores said, "The world does not need another place to sell Disney merchandise - this only works if it's an experience," recognizing that its previous store format simply had a typical gift shop feel. Under terms of the plan, Disney would spend approximately $1 million on each store, revamping them with show-stopping design and interactive technologies. Elements include an in-store theatre showing movie clips, karaoke contests, live video chat with Disney stars. Reportedly, Disney is getting assistance from Apple's retail operations group with this re-design.

The first Imagination Park stores are scheduled to open in May in Southern California and Long Island, as well as Madrid, Spain. The company is reportedly close to signing a lease for a flagship store in New York City’s Times Square -- the company already leases space at 1500 Broadway for its Disney & ESPN Networks operations. A few additional stores are rumored to be in the works as well. In August of last year, Disney announced that its existing 64,000-square-foot flagship store at 711 Fifth Avenue would close when its lease expires in spring 2010.

CLOSINGS/CUTBACKS/BANKRUPTCIES/DEFAULTS

Lowe's Disposing of 67 Parcels of Land Throughout the Southeast
Lowe's has hired Atlantic Retail Properties to dispose of excess real estate in five Southeast states. The assets include 67 parcels of land and one 50,000-square-foot store, according to Atlantic. Last month, Lowe's announced that it was cutting back its 2010 store opening plans to 35 to 45 new stores. As a result of these plans, the company decided to walk away from a number of future store projects, resulting in a $48 million write-off.

Alabama: 11 parcels of land totaling 22.7 acres in Florence, Gunterville, Hartselle, Mobile, Muscle Shoals, Northport, and Pratville.

Florida: 18 parcels of land totaling 81.4 acres and a 50,000-square-foot building in Cape Coral, Clermont, Homestead, Lakeland, Leesburg, Naples, North Port, Ocala, Oviedo, Pace, Pensacola, Plant City, Sarasota, South Tampa, Sunrise and Tallahassee.

Mississippi: Six lots totaling 8.2 acres in Gautier, Greenville, Southaven, and Pascagoula.

Georgia: Five lots totaling 12.8 acres in Albany, Cornelia, Moultrie, and Thomasville.

North Carolina: 21 lots totaling 174 acres in Charlotte, Hickory, Kannapolis, Knightdale, Lenoir, Mooresville, Raleigh, Reidsville, Durham, Troutman, Wake Forest, and Wilkesboro.

South Carolina: Five lots totaling 8.2 acres in Clemson and Florence.

Tennessee: One acres of land in Spring Hill.

Luby's Closing 25+ Restaurants
Houston-based cafeteria-style restaurant chain, Luby's (NYSE:LUB), is closing 25 underperforming stores by end of this month; additionally, the company said closing another five to 10 restaurants in the next two years is possible. Following these closures, the company will operate 95 restaurants, compared to 122 restaurants this time one year ago. Additionally, Luby's has 28 additional restaurant properties that remain held for sale. The typical Luby's is a freestanding building between 8,000 and 10,500 square feet.

ACQUISITION/MERGER/SALE/LOAN/IPO ACTIVITY

Charlotte Russe Gone Private in $380M Deal
Advent International Corporation has completed its go-private buyout of fashion apparel retailer, Charlotte Russe. On October 14th, Advent announced the official closing of its tender offer of Charlotte Russe Holding through affiliate, Advent CR Holdings. Advent acquired all outstanding shares of Charlotte Russe's common stock at $17.50 per share for a total purchase price of approximately $380 million. As of September 26, 2009, the company operated 504 stores in 45 states and Puerto Rico. Advent's other retail investments include Lululemon Athletica, Hudson News and other international companies.

Tribeca Launching $100M Fund to Invest Opportunistically in Retail and Multifamily
San Francisco-based private equity firm, Tribeca Cos., is raising money for a $100 million fund it plans to invest in grocery-anchored shopping centers and multifamily properties. The company plans to take advantage of value-add opportunities, particularly in California, Arizona and Nevada. Target acquisition prices for the opportunistic buys are between $5 million and $50 million. As part of this effort, the company hired two executives -- Jeffrey Morris, formerly of BlackRock and James Roessler, formerly of Feher Young & Associates.

NEW SUPPLY

Grand Opening Held at The Shops at Stone Park
A grand opening was held recently at The Shops at Stone Park, a 259,000-square-foot power center located at the northeast corner of Beltway 8 and Wallisville Road in Houston. Anchored by JC Penney, other major tenants include Best Buy, Marshalls, Staples, Rack Room Shoes, Party City, Dress Barn, rue 21, and Mattress Giant. Outparcel restaurants include Olive Garden, Chick-Fil-A and Chipotle. Joint developers of the 23-acre project are NewQuest Properties and Ley-Wilson Properties.

Village at Knapp's Crossing Breaks Ground in Grand Rapids
In Western Michigan, a $60 million lifestyle center, Village at Knapp's Crossing, broke ground on October 6, 2009. Phase one of the 300,000-square-foot project is underway at East Beltline Avenue NE and Knapp Street in Grand Rapids. A 50,000-square-foot D&W Fresh Market, one of Spartan Stores' banners, is the center's anchor tenant, expected to open in June 2010. A P.F. Chang's restaurant is planned to open next fall and the project's developer is planning on a department store, Italian restaurant and drugstore to be announced soon as well. The developer is Evergreen Properties and Lamar is the construction firm on the job.

PERSONNEL ANNOUNCEMENTS

Steven Grimes Taking Over as CEO and President of Inland Western Retail Real Estate Trust
On October 13, 2009, Michael J. O’Hanlon resigned as Chief Executive Officer and President of Inland Western Retail Real Estate Trust. Steven P. Grimes, the company's current Chief Operating Office and Chief Financial Officer has been appointed as CEO, CFO, President and Treasurer. O'Hanlon's time with Inland isn't over, however; according to Chicago Real Estate Daily, an Inland spokesperson said O'Hanlon is "stepping down to assume a role at another Inland entity", a job that will be announced at a later date.

Grimes joined Inland Western in early 2004 as a business manager and advisor and since, he has held positions as Principal Financial Officer and Treasurer of the company. During this time, Grimes oversaw the acquisition of over $8.3 billion in real estate assets and over $4.3 billion in financings. Prior to Inland, Grimes worked as a Director at Cohen Financial and Senior Manager at Deloitte & Touche. He holds a BS In Accounting from Indiana University and is a Certified Public Accountant. Grimes is a member of the National Association of Real Estate Investment Trusts, the International Council of Shopping Centers, the American Institute of Certified Public Accountants and the Illinois CPA Society.

Equity Chooses VP of Cleveland Office
Cleveland commercial real estate broker, Mark Salman, has joined Equity, a Columbus?based full service real estate company as a vice president. Equity has offices in Columbus, Cincinnati, Cleveland, Dayton and Tampa, but has recently sought out real estate advisors in new markets to broaden its reach. Other brokers have joined the Equity network in Orlando, Atlanta, Washington DC, Dayton and San Antonio. Salman's affiliation with Equity broadens his services beyond brokerage to include development, construction and other real estate services. Equity's core practice is retail tenant representation.

Salman's more than 14 years' industry experience includes most recently working for Continental Retail Development as vice president of retail, where he leased the new Streets of Brentwood lifestyle center in Brentwood, CA. Prior to that, he was a vice president of leasing at Westfield, where he was responsible for leasing six regional malls in OH, IN and NE totaling 10 million square feet. Prior to that, he worked for Developers Diversified Realty (DDR) in Beachwood, OH, where he was responsible for power centers and new developments in MN, MA, NJ, IA, ME, VT, PA and NY. Salman started his career leasing malls for Richard E. Jacobs Group.

Marcus & Millichap Names Washington D.C. Regional Manager
Marcus & Millichap recently named David Feldman as regional manager of the firm's Washington, D.C. office. Feldman has been with Marcus & Millichap since 2004, starting in the Los Angeles office as an investment specialist focused on single tenant net-lease retail assets. Since, he has become a member of the firm's National Retail Group and associate member of its Net Leased Properties Group. Feldman was promoted to an associate in 2005 and in 2007, earned the title of senior associate. In late 2008, Feldman was promoted to sales manager of Marcus & Millichap's Atlanta office.

SUSTAINABILITY / GREEN BUILDING

Santa Monica Place Seeks LEED Certification
In Santa Monica, CA, Macerich (NYSE:MAC) is seeking LEED Certification from the USGBC for the new Santa Monica Place, an open-air, 550,000-square-foot, three-story shopping and dining destination that is the redevelopment of a former enclosed mall located two blocks from the Santa Monica Beach along the Third Street Promenade.

"Green" elements qualifying Santa Monica Place for LEED Certification include:

The recycling of a climatized enclosed existing building into an open-air center

Recycling construction debris

Installation of solar roofing in certain tenant areas

Addition of pedestrian walkways and public transportation points

Water-efficient landscaping and water-reducing technologies

Use of low-emitting paints, adhesives, carpets, coating and other materials.

Use of recycled materials in construction

Santa Monica Place restaurants include Zengo, La Sandia, Pizza Antica, Ozumo Sushi, and XINO Restaurant + Lounge, among others. The center is anchored by Bloomingdale's first SoHo concept store and Nordstrom. Other retailers signed on for the project include Nike, CB2, Burberry, Kitson, Michael Kors, Ted Baker, BCBGMAXAZRIA, Coach, Ed Hardy, True Religion, Joe’s Jeans, Swarovski, Ilori, Love Culture, Angl, Bernini, Michael Brandon, R.O.C. Republic of Couture, Arthur and Shuz, as well as Artevo, a technology-driven art gallery.

ICSC's RetailGreen Conference Held in Hollywood
This past week in Hollywood, the International Council of Shopping Centers (ICSC) held the RetailGreen Conferene & Trade Exposition. "On-site power generation, through solar water heaters, heat pumps or wind turbines, has emerged as a way that commercial property owners can realize savings and actually generate revenue," ICSC said of its panelist discussions. Many companies are acting on social expectations for acting sustainably, as opposed to money-saving motivation, said panelists, adding that financing capital-intensive green initiatives has been a challenge for many.

Lawrence E. Kilduff, chairman of the ICSC Environmental Subcommittee and president of the Kilduff Co was quoted, "This year’s conference [took] an in-depth look at how all sectors of the industry can improve their success rate and have a positive ecological impact through the use of sustainability actions.” Vendors and service providers to the green building industry were on display at the conference.

More US National Commercial Real Estate News Stories:

Next Steps

800-204-5960

Email Us

# 1 Commercial Real Estate Information Company