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CoStar's Retail News Roundup: Oct. 21-27, 2007

CoStar Reports on Retail Expansion Plans, New Developments, Acquisitions/Mergers/Sales, Personnel, Sustainability and more...
October 22, 2007
This week in the Retail Roundup, CoStar reports on expansions and new concepts at Tiffany's, Borders, Home Depot, Zoup!, Luby's, and Apple; new retail developments in CA, AZ, PA, FL, IL , TN, MI, and OH; acquisition, merger, or sale activity at Steven Madden and Sun Capital; Closings at New York & Company and Michaels; sustainability efforts at Regency Centers, Shaws and Office Depot; Personnel announcements at Centro, Prudential, Jones Lang Lasalle; and more.

Did you miss last week's CoStar Advisor story, Impact of Slowing Economy Seen On Retail Construction? If so, follow this link to read the story.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


EXPANSIONS / NEW CONCEPTS


Tiffany's Establishes Smaller Store Format to More than Double U.S. Store Fleet
Luxury jewelry retailer, Tiffany & Co. (NYSE:TIF), which operates 68 stores in the U.S., established an initiative to significantly increase its U.S. store base. The company plans to operate as many as 170 stores in the U.S. by opening five to seven stores per year in its traditional 5,000-square-foot store format and opening up to 70 stores in its new Tiffany & Co. Collections format at pace of three to five stores per year, which is only 2,000 square feet. The first Collections store will open next year, the smaller format makes it more attainable to penetrate more markets with its luxury brand.

Apple's SanTan Village Store is the Chain's 200th
When Apple opens its doors to a new store at Westcor's SanTan Village super regional shopping center this week in Gilbert, AZ, the opening will be the company's 200th. The milestone is significant, as it was achieved in just four years. The first store opened in Tysons Corner, VA, and Apple has since grown the fleet to $1 billion in sales. Apple has been particularly successful at gleaning attention for its stores through their modern designs and experiential feel.

Home Depot Opens Female Friendly Concept: Home Depot Design center
Home Depot has opened a softer store concept in Charlotte as a test for future prototypes. Tagged Home Depot Design Center, the 100,000-square-foot store opens to an 11,000-square-foot showroom with furniture and accessories from its catalog business, Home Decorators Collection. Designed to be female friendly the concept causes remembrance of the company's Expo Design Centers. Void of the lumber department, this version focuses on home organization, gardening, and outfitting rooms of the home.

Borders Opening First U.S. Paperchase Stand-Alone Store
Ann Arbor, MI-based Borders Group, book retailer with more than 1,100 stores nationwide, will open the first stand-alone Paperchase store this Wednesday, Oct. 24th, on Newbury Street in Boston. Borders acquired Paperchase in 2004, the brand has 100 stores in the U.K. and Borders has since opened 300 Paperchase store-within-a-stores in 300 Borders locations across the country. Borders' long range strategic plan includes further expansion of Paperchase within its stores as well as through stand-alone stores, specifically five to eight new stand-alone stores through 2008. The Newbury Street store selling fashion-driven paper products including cards, stationery and gift wrap, is 1,525 square feet.

Luby's to Add up to 50 New Restaurants Through 2010
Houston, TX-based Luby's (NYSE:LUB), operator of 128 cafeteria-style restaurants throughout Texas, reported full year results a 30% increase in annual unit volume, but a slight decline in same store sales. The company established a new prototype restaurant during the year that it believes is "the next generation of cafeteria" dining. Luby's plans to open 45 to 50 new stores over the next five years, with four to six new units targeted to open in 2008. According to CoStar Tenant, the average Luby's restaurant is freestanding and 8,000 square feet; as outparcels to busy shopping centers or on well-traveled streets.

Zoup! Fresh Soup Company Expanding into IN, WI and IL
Southfield, MI-based Zoup! Fresh Soup Company, quick service restaurant operator with 16 stores currently open in Mi, PA and OH, has registered to do business in IN, WI and IL. Through a franchise business model, Zoup! plans further expansion throughout the Midwest. With 12 rotating soups available every day, Zoup! also sells salads and sandwiches. According to CoStar tenant, the average Zoup! is 2,000 square feet.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


NEW SUPPLY


Interra and Prudential Join Up on $82M in Acquisitions, Planned for More Than 800,000 SF of Retail
Chicago-based Interra-Vision Development in a joint venture with Prudential Real Estate Investors of Parsippany, NJ, completed the acquisition of four land parcels, slated for retail space, for $82 million. In Florida City, FL, the JV acquired a 19-acre site for $18 million that is planned for a $45 million, 200,000-square-foot community center anchored by Best Buy and grocery store; that is expected to break ground first quarter 2008. Gadinsky Real Estate of Miami serves as leasing firm for the project.

In Gilbert, AZ, the joint venture acquired a 17-acre site for $22 million that is across from Westcor's recently opened super regional shopping center, SanTan Village. The site is planned for a $52 million lifestyle center with 100,000 square feet of retail space, banks, restaurants, a daycare center, and more. First quarter 2008 is the estimate for ground breaking of this project.

In Maricopa, AZ, the group acquired 54 acres on Casa Grande Highway for $14 million. The proposal is to develop a $56 million, 511,500-square-foot regional shopping center include anchors, junior anchors, specialty retail, restaurants, and outparcels. Adjacent to the site of a future Wal-Mart Supercenter, the project is expected to break ground in 2009.

Between Los Angeles and San Diego in Murrieta, CA, the joint venture acquired 16 acres expected to be the first piece of a 40-acre parcel the group is working on assembling, for a total of $28 million. Located at I-15 and I-215 in Murrieta, a $65 million mixed-use project with retail, office and hotel space is planned to break ground in 2009.

Valley Square Lifestyle Center Opening Next Month
A 425,000-square-foot mixed-use lifestyle center including 300,000 square feet of retail space and 125,000 square feet of office space will officially open to the public Nov. 8th in Warrington, PA.

Located at the intersection of Route 611 and Route 132 in Bucks County, the project is a phase of Valley Square, a 140-acre mixed-use development that also includes a Wegman's supermarket, 200 active adult luxury residences and big-box retail.

Developed by Philadelphia's Grasso Holdings, Valley Square Lifestyle Center's tenant lineup includes Ann Taylor Loft, Borders, PF Chang’s, Eastern Mountain Sports, Victoria’s Secret, Bath and Body Works, White House/Black Market, Starbucks, JE Caldwell, Sunglass Hut, AVEDA, Chico’s, J. Jill, Panera Bread, Chipotle, Blue Tulip, and Banana Republic.

Peter Maggio of US Realty Associates serves as leasing agent for the property.

Cousins and Faison Celebrated Grand Opening of The Avenue Murfreesboro Last Week
Atlanta, GA-based Cousins Properties and Charlotte, NC-based Faison Enterprises, last Wednesday celebrated the grand opening of The Avenue Murfreesboro Phase I, the 660,000-square-foot first phase of an 810,000-square-foot open-air retail center in the Nashville, TN, metropolitan area. The project is at the center of a 400-acre master planned commercial development along the new Medical Center Parkway that is planned for medical, office, hotel, convention center and public spaces in addition to retail.

The Avenue's tenant lineup of 110 retailers and restaurants; the long line-up includes anchors Belk, Linens-N-Things, Dick's Sporting Goods, Michael's, Cost Plus World Market, Best Buy, Barnes & Noble and Petco; while specialty retailers include Ann Taylor Loft, Carters, Chico's, Coldwater Creek, Lane Bryant, Limited Too, New York & Company, Osh Kosh B'Gosh, Talbots, The Children's Place, Ulta, White House/Black Market, Yankee Candle, Bath & Body Works, Crabtree & Evelyn, Gymboree, Harry & David, Liz Claiborne, Merle Norman, Motherhood Maternity, Sunglass Hut and Wet Seal; and restaurants include Longhorn Steakhouse, Mimi's Café, Romano's Macaroni Grill, and Maggie Moo's.

The venture reports the development was 78% committed at the time of opening. "The Avenue" is one of Cousins' successful retail center prototypes, the company has four others already open in Atlanta, Memphis, Los Angeles, and Viera, FL.

Taubman's 640,000-SF Mall at Partridge Creek Now Open
Bloomfield Hills, MI-based Taubman Centers, retail REIT with a portfolio 24 major shopping centers in 11 states, celebrated the grand opening of its Mall at Partridge Creek on Oct. 18th. The 640,000-square-foot open-air regional shopping center is in Clinton Township, MI, about 20 miles northeast of Detroit.

Partridge Creek's anchor tenants are a 122,000-square-foot Nordstrom (opening April 2008), a 120,000-square-foot Parisian, and a 14-screen, 55,749-square-foot MJR movie theatre. The project's other 90 shops and restaurants include Aldo, Banana Republic, Bath & Body Works, Gap, GapKids, H&M, Kay Jewelers, Victoria's Secret and Zales Jewelers, Sur La Table, Calvin Klein, The Territory Ahead, Pizza Rustica, Cacique, Shi by Journey's, Moonstruck Chocolate Café, For Love 21, BEBE Sport, Illuminations, Aveda Salon & Spa, Nine West, Auntie Anne's, Godiva Chocolatier, Starbucks, Surf City Squeeze, Bar Louie, Brio Tuscan Grille, California Pizza Kitchen, Marble Slab Creamery, P.F. Chang's, Max & Erma's, and Nestlé Toll House Cafe by Chip.

Taubman said that Partridge Creek was more than 93% leased at the time of opening; that about 70% of the tenants are new to the county; and that the regional shopping center is the first to be built in the county in more than 30 years. Some unique features of the project include a healthy foods-themed play area for kids, bocce courts, flat-screen outdoor TV sets, free wireless internet access, a 30-foot outdoor fireplace, snow-melting sidewalks, and "canine comfort stations" with water troughs and waste bags.

Macerich De-Malling Santa Monica Mall
Santa Monica-based mall conglomerate, Macerich, is nearing final approvals on the redevelopment of one of its first malls in its hometown. The current Santa Monica Place is a 553,000-square-foot enclosed mall with a Macy's anchor right near Third Street in Santa Monica's downtown. Macerich will de-mall Santa Monica Place, taking the roof off the center of the mall to create a seamless connection with Third Street. Along with new facades, the mall will include open-air walkways, a rooftop dining deck, a central gathering space , art installations, and a children's play area. Macerich's plan reuses the same footprint and actually results in slightly less retail space. Macy's will be the only retailer that will remain open during the redevelopment; Macerich will close the rest of the mall before it plans to break ground March 2008, re-opening is scheduled for Fall 2009.

GGP's 1M-SF Shops at Fallen Timbers Now Open in Toledo Area
General Growth Properties earlier this month celebrated the grand opening of its 1-million-square-foot The Shops at Fallen Timbers lifestyle center in Maumee, OH. With a 97,500-square-foot JC Penney, 204,000-square-foot Dillard's, Barnes & Noble, and a 14-screen stadium seating Showcase Cinema as anchors, the 110-acre development is at the intersection of US-24 and I-475 in this suburb of Toledo. Other tenants include PF Chang's, Aeropostale, American Eagle Outfitters, Bath & Body Works, The Children’s Place, Gap/Gap Kids, Limited Too, Red Robin and Victoria’s Secret, among others. GGP has created a man-made lake offering pedestrian walkways and views from the restaurants as a main attraction. In 2008, two four-story office buildings and a bank on the opposite side of the street, which GGP is labeling Fallen Timbers Business Center, will complement the retail center.

CBL and Benchmark to Develop 550,000-SF Lifestyle Center
Chattanooga, TN-based CBL & Associates (NYSE:CBL), owner or manager of 130 properties totaling 75 million square feet, has partnered with Amherst, NY-based Benchmark Group, a diversified development company with $1 billion in property in 12 states. The two are bringing The Pavilion at Port Orange, a 550,000-square-foot lifestyle center, to 75 acres just off I-95 in Port Orange, Volusia County, FL, - an outlying metro of Orlando. A Belk department store and a 14-screen Hollywood Theatre will anchor the development while junior anchors and specialty retailers will also be announced. The project also includes 31,000 square feet of second floor office space. The Pavilion will break ground first quarter 2008 and is scheduled to deliver fall 2009. CBL is responsible for the development, leasing and management of the center.

Desco Group Celebrates Opening of First Tenants at Power Center in IL
St. Louis-based Desco Group, founded by the brothers who starts the Schnuck's grocery chain, celebrated the opening of an 127,000-square-foot Target, 140,000-square-foot Home Depot and a Famous Footwear last week as the first tenants of a new power center's first phase of 410,000 square feet in Belleville, IL. Located on 90 acres at the intersection of Frank Scott Parkway and Highway 15, the center will eventually be occupied by 600,000 square feet of retail space, including several outparcels. Other phase I tenants include OfficeMax opening by year-end, as well as Hibbett Sports, PetSmart, Maurices, Mattress Giant, and more. Desco will complete the remaining 200,000 square feet in three more phases, with the second expected to break ground in 2008.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


ACQUISITIONS / MERGERS / SALES


Steven Madden Reviewing Strategic Alternatives
Long Island City, NY-based Steven Madden Ltd. (NASDAQ:SHOO), trendy footwear designer and operator of 100 Steven Madden retail stores, received inquiries from third parties regarding acquisition of the company. Urged by shareholders, the company is evaluating its strategic alternatives and has formed a strategic review committee of the board responsible for evaluating any potential sale transaction. Peter J. Solomon & Co. has been contracted as financial advisor in the matter.

The company recently provided a business update for third quarter and the full year, under which it cites a "more challenging than expected sales environment" in third quarter. Steven Madden expects to report a 13% decrease in total retail sales and 15% decrease in comparable store sales for third quarter. For the full year, the company predicts a decrease of 9% to 11% in total sales over the previous year.

Sun Capital Buys 33 C-Stores Through Village Pantry Arm
Boca Raton, FL-based Sun Capital Partners, through its convenience store affiliate, Village Pantry, acquired the business of Imperial Co., which operates 33 convenience stores in MI and northern IN under banner "Next Door Store". Terms of the acquisition were not disclosed. Village Pantry operates 146 convenience stores under various banners in OH and IN.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


CLOSINGS / CUTBACKS


Surprisingly, New York & Company Shedding JasmineSola
New York & Company (NYSE:NWY) ("NY&Co), specialty women's apparel retailer with 561 core brand stores in 44 states, little more than six months ago said in its full-year report that it would be opening five new JasmineSola stores this year to bring its stores count to 24, would be building a new distribution center to support growth to 100 stores, and would also be building its leadership team for the brand . NY&Co purchased Boston-based Jasmine Co. in summer 2005 with the intention of developing it into its higher-priced, trendier brand.

Sentiments are of stark contrast now, however, as NY&Co announced a review of strategic alternatives has resulted in the decision to exit the JasmineSola concept by the close of fourth quarter 2007 (ends Feb. 2008). The company is exploring the feasibility of converting its existing 23 JasmineSola stores into NY&Co stores, but expects to incur tax charges relating to exiting the business of up to $30 million. Vague in its reasons, NY&Co simply stated that it sees "higher return opportunities" for its NY&Co brand.

Michaels Exiting Non-Core Banners Recollections and Star Decorators
Irving, TX-based Michaels Stores, leading arts and crafts retailer, is realigning its resources to support its core banners, Michaels and Aaron Brothers, under which it operates 955 and 168 stores, respectively. The plan involves the exiting its non-core businesses, Recollections (a scrapbooking retail arm started in 2003) and Star Decorators' Wholesale (membership-based warehouse stores), under which it operates 11 and four stores, respectively. Michaels will close all of its Recollections and three of the four Star Decorators stores by the end of its fiscal first quarter 2008 and expects to incur $11 million to $14 million in charges as a result of lease obligations, liquidating inventory, etcetera. During the first half of fiscal 2007, Michaels had opened 20 new stores and renovated 35 stores amongst its core brands. Sales have been below expectations for most of the year.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


SUSTAINABILITY/ GREENING


Regency Centers Pursuing LEED Certification for Indiana Retail Center
Jacksonville, FL-based Regency Centers (NYSE:REG), owner of 413 retail properties totaling nearly 55 million square feet, is pursuing LEED Core and Shell certification for Shops on Main, a new town center retail property scheduled to break ground this fall and complete May 2009 in Schererville, IN. The 350,000-square-foot center will be full of upscale retailers and restaurants and feature public gathering spaces, cobblestone pathways, brick storefronts, stylish fixtures, and generous landscaping.

Regency's Shops on Main will be the second property the company is seeking LEED certification on, the first is Shops of Santa Monica, a 67,226-square-foot redevelopment project in Santa Barbara, CA to be anchored by Whole Foods. Green elements planned for Shops on Main include use of local materials, recycled materials, and energy and resource conservation materials throughout the entire project.

The LEED Core and Shell certification program is designed to make it easier for developers and builders to LEED certify a project, recognizing that the core and shell needs to be separated from a project's tenants; tenants are then encourages to make the interior buildout sustainable. Regency is a member of the USGBC and has been instrumental in the development of the organization's pilot program for new construction of shopping centers, which involves partnership between developers and retailers achieve LEED certification.

Recycling Programs at Shaws and Office Depot
Shaws Supermarkets has partnered with Philadelphia-based RecycleBank to create a rewards program for customers that recycle. Shaw's customers will be able to earn RecycleBank Points based on how much they recycle that can in turn be used towards Shaw's store purchases.

Office Depot is rolling out a program already tested in 100 stores throughout its entire 1,100-store fleet. The company's Tech Recycling Service essentially involves customers paying office depot to recycle appropriately for them, by buying a box for $5, $10, or $15 that can be filled with items like computer monitors, cell phones, small TVs, printers, cameras, and more and then turning that into customer service. Office Depot says the program has already resulted in the recycling of more than 108,000 pounds of technology. The company already offers an ink and toner cartridge-recycling program.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


PERSONNEL


Centro Creates Team Dedicated to Malls and Lifestyle Centers, Hires Former Regency Exec as SVP for West Region
Centro Properties Group, the fifth largest owner of shopping centers in the U.S. with a portfolio of more than 650 properties totaling 109 million square feet, formed a team of personnel dedicated to the management and leasing of the company's U.S. malls and lifestyle centers.

Lead by Leonard Brumberg as executive vice president with more than 35 years experience, the team includes Robert Steiner, senior vice president of leasing; Dennis Connolly, vice president of development and redevelopment; Al Dorn, vice president of property management; Susan Godorov, vice president of marketing; Anne Williams-Eilola, director of legal services; and John Mobley, property controller.

The list of malls and lifestyle centers the team has been assigned to are: Eagle Rock Plaza in Los Angeles; Enfield Square in Enfield, CT; West Park Mall in Cape Girardeau, MO; Independence Mall in Wilmington, NC; Midway Mall in Elyria, OH; Richland Mall in Mansfield, OH; The Shoppes at EastChase in Montgomery, AL; Pointe Orlando in Orlando, FL; and Westgate in Fairview Park, OH.

Centro has also appointed a senior vice president for the West Region that will oversee more than 50 properties totaling 9.6 million square feet in AZ, CA, CO, NV, NM, WY and TX. With 17 years industry experience, Enrique Legaspi joins Centro from Regency Centers where he was VP and regional officer responsible for asset management, leasing and property management of 4.2 million square feet of space.

JLL Retail Appointed to Lease and Manage Colorado and California Malls
Chicago-based real estate investment company, GEM Realty Capital, appointed Jones Lang LaSalle Retail, which manages a 56-million-square-foot portfolio of 150 retail properties across 31 states, as co-leasing and managing agents for its 560,996-square-foot Pueblo Mall in Pueblo, CO. Located at the intersection of I-25 and Highway 47 in the area south of Denver, the mall is anchored by Dillard's, JC Penney, Sears and Sports Authority and underwent a renovation in 2005. JLLR has appointed Rick Sundberg, regional leasing manager and Cayce St. Aubin, leasing specialist to head the account. The co-leasing company is North Shore Properties Group with the leasing team led by Steve Weiss and Max Reiswerg.

Orbit Resources, the new owner of Cupertino Square mall (formerly known as Vallco Fashion Park) in Cupertino, CA has also selected JLL to manage and lease its mall. JLL's Mike Rafferty will handle specialty leasing for the 1.4-million-square-foot urban retail center while Mike Rhode will serve as general manager. Cupertino Square recently underwent a full-scale renovation, which included the addition of an AMC movie theatre and third floor.

Consolo Named as Top 100 Most Influential Woman
New York City 2006 CoStar Retail Leasing Power Broker and chairman of Prudential Douglas Elliman's Retail Leasing and Sales Division, Faith Hope Consolo, has been named as one of the "Top 100 Most Influential Women in Business" by Crain's New York Business Magazine. A regular contributor to CoStar's national retail news coverage, Consolo has repeatedly been positioned at the top of Prudential Douglas Elliman's rankings for total commercial deal volume and provides tenant representation and leasing services for some of the country's foremost names in retail.


In addition to appearing every week in the national news and retail news section of our web site, you may also receive the Retail News Roundup via email by contacting the editor, Sasha Pardy at spardy@CoStar.comAlso, click hereto subscribe to CoStar's dedicated Retail RSS Feed.


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