Retail News - Labelscar: The Retail History Blog

The Next Domino to Fall: Mervyn’s?

Mervyn's

Mervyn’s, a large western chain of discount clothing/housewares retailers–very similar to Kohl’s, for those of you in other parts of the country–may well be the next major bankruptcy to hit American malls:

Mervyn’s LLC may be forced to file for Chapter 11 bankruptcy protection as early as this month if the California department-store chain fails to persuade its suppliers to ship products for the back-to-school season, according to a published report.

Some of Mervyn’s vendors have stopped shipping to the company, with its access to financing pulled by some key lenders, according to The Wall Street Journal. The company may be forced to shut its 177 stores in seven states, the paper said.

Mervyn’s is a major mall anchor in western states, and particularly in California. A Mervyn’s bankruptcy would create a large amount of vacant real estate that would be very difficult to fill.

Hudson’s Bay Co. bought by Lord & Taylor parent

Recently, 338-year-old Canadian retail giant Hudson’s Bay Company, which operates numerous chain nameplates such as discounter Zellers and The Bay department stores, received a takeover bid from U.S. retailer Lord & Taylor. Already a minor shareholder in Hudson’s Bay Company, Lord & Taylor wouldn’t be the first American company to own this brand; the company is already owned by American Anita Zucker, whose late husband, Jerry, gained control of the company in 2006.

On July 16, the sale was complete, and Hudson’s Bay is now part of the Lord & Taylor fold. Now that Lord & Taylor has a more impressive foothold in North America, what – if anything – do you think will happen to the Hudson’s Bay name? Will it float off into the ether like other venerable brands have over the years – Marshall Field’s, Filene’s, McAlpin’s – just to name a few – or will Lord & Taylor realize the brand has enough equity to keep it afloat?

I, personally, wouldn’t want to see the Hudson’s Bay name disappear across Canada, but what I think hasn’t stopped retailers from shifting and consolidating nameplates in the U.S. I think many people are still miffed about what Macy’s did over the past few years, taking away many regional banners and creating a “unified” Macy’s across the entire United States. Was it worth it for them? Time will tell, but the very reasons they used for unifying their holdings have been sort of left by the wayside, with separate, more upscale Macy’s locations popping up in certain places and not others. The issue is probably more weighty in some places rather than others, too; for example, Chicago’s affinity for Marshall Fields has probably cost Macy’s more money and loyalty than the regional banners in other areas, but who can be so sure? Only time will tell.

Americans Really DON’T Need Cheap College Sweatshirts; AND Wal-Mart Gets a Re-Fresh?

From the news bin:

Steve & Barry’s, whose wild success over the past five years has been every bit as puzzling as their business model and inventory of cheap goods, appears to be in deep trouble:

NEW YORK (Reuters) – Retailer Steve & Barry’s LLC is readying plans to close more than 100 of its stores, and is contemplating a full liquidation should it not find emergency financing, the Wall Street Journal reported on its website on Monday.

The article, citing people familiar with the company, said the retail chain is seeking a tentative plan for about $40 million in debtor-in-possession financing if it must file for bankruptcy protection. Steve & Barry could not immediately be reached for comment.

Wal-Mart’s aesthetics are notoriously un-glamorous; only downright-dingy Kmart is frequently considered worse. But Kmart always had one thing on ol’ Wallyworld, and that’s a slightly superior logo. But Wal-Mart is tossing out its ridged plastic letters in favor of something sort of retro:

Wal-Mart Stores Inc. is about to change one of the most familiar logos in corporate America.

Part of Wal-Mart’s continuing effort to update its once-dowdy image, the new logo for signs and building facades includes white letters on a burnt-orange background followed by a white starburst, according to an artist’s rendering that the company filed recently with planning officials in Memphis, Tenn.

In a change, the name will appear as one word: Walmart. When the company first started in 1962, the name was hyphenated by a dash. But in the past decade, the dash has been replaced by a star on stores and the corporate letterhead.

Hmm. The star reminds me mysteriously of Zayre. I wonder who else has ripped off that star.

Jasmine Sola: Rip Her To Shreds

Jasmine Sola Store

There’s an interesting article in today’s Boston Globe about the impending demise of Jasmine Sola, a trendy, upscale women’s clothier that had until recently been on a meteoric rise. The story details how Jasmine Sola went from a carefully-curated boutique in Cambridge, Massachusetts to a booming regional chain known for its colorful stores and high-end (yet young-skewing) merchandise before being sold to New York and Company, who in only two years managed to overexpand and destroy the chain’s merchandise mix. The way they neglected to cater their merchandise mix to individual markets is also somewhat reminiscent to many of the complaints about the national strategy employed by Macy’s:

“Manganella, an Italian immigrant who started Jasmine in 1970 with a $2,500 loan from his mother, had relied on instinct, not science or financial spreadsheets. He learned about women’s clothing from his mother and sister, both seamstresses, and developed a keen sense of style. At Jasmine, named after the flower, he had given space to unknown designers, which made his boutique a fashion icon for teens and twentysomethings…

“Meanwhile, New York & Co. began changing the formula that made Jasmine a success, narrowing the number of brands offered, buying lower-end merchandise, and opening bigger stores. New York & Co. started outfitting all Jasmine stores with the same amount and type of items, eliminating another of Manganella’s innovations: merchandise tailored for each store, with lower-priced clothes for the college students shopping at Harvard Square, and higher-end clothes for Newton and Wellesley.

“The change meant a new Miami store received chunky sweaters and corduroy pants in the middle of the summer – the same back-to-school items Northeast stores featured, according to Liza Baird, who had worked at local Jasmine stores, and moved to Miami in April 2006 to open the first Jasmine shop in Florida. Sales were so poor, Baird said, that some days the store barely broke $1,000.”

There’s also quite a bit about the dispute between New York and Company and Jasmine Sola founder Luciano Manganella, who was fired after allegations of sexual harassment.

Jasmine Sola is just one of the retail closures we’re seeing this Christmas season, along with Levitz Furniture and CompUSA. KB Toys also announced a wide swath of store closures, which raises speculation that the chain may be history once the holiday season draws to a close.

News and Miscellany

It’s been a while since we offered anything other than shopping center write-ups, and we realize that part of the advantage of having a chronological blog is the ability to post current information.

In suburban Milwaukee, Wisconsin, a large upscale regional mall proposal called Pabst Farms Town Center is tenatively back on, but this time with a different developer and possibly a different format. In October, Chicago-based General Growth Properties dropped the project, citing lack of interest for the upscale tenants the city wanted to attract, such as Nordstrom or Von Maur. Today, Doris Hajewski writes in the Milwaukee Journal-Sentinel that the city has found a new developer in Developers Diversified Realty (DDR) of Cleveland. However, DDR’s portfolio does not include high end department stores, and it was reported that the center will probably be open-air rather than enclosed as previously planned. Yet the city of Oconomowoc is repeatedly pressing that the site not be just a collection of big box stores or any other sort of bland ephemera, like the development a couple exits to the east along I-94 at WI 83 in Delafield.Personally, this turn of events is kind of a let down. The state of Wisconsin, which has an above average rate of growth, has not had a new regional mall constructed in over twenty years. In fact, it has lost several in the same span of time. More specifically to this project, Waukesha County is a fast-growing and wealthy county, with an estimate of 380,000 residents as of 2006. Waukesha County currently has one regional shopping center, located in the far eastern side of the county in Brookfield; it was constructed over thirty years ago and is a simple one-level barbell design with three anchors.

As the entirety of Waukesha County is suburban Milwaukee, residents also utilize the shopping options there, which have also dwindled in recent years and focus on Mayfair Mall in Wauwatosa and Bayshore Town Center in Glendale. However, as suburban growth has invaded Waukesha County, the county’s center of population has moved significantly west away from Milwaukee. In addition, the towns closest to the center in the “Lakes” area are some of the wealthiest in the state.

This project would simultaneously take advantage of both the center of population shift in Waukesha County and the lack of large regional centers in the area. Located in western Waukesha County with easy access to I-94 and the new WI 67 bypass around Oconomowoc, the center would draw from a large and wealthy base, including rapidly growing areas along I-94 west all the way to Madison which is only 40 minutes away and the state’s second largest population center.

So, the argument that the density is low in Oconomowoc and that no one would come is completley ludicrous. People will travel to get to this type of center, if it’s made destination-worthy. And, it sounds like it would have been and possibly will be if the city and others get their way. They definitely have the right idea, and have been planning this project for years, even working with the WI Department of Transportation upgrading the interchange there and locating a business park with a future hospital at the southern end of the interchange. I think it’s entirely appropriate for the city to send the message to developers that they don’t want another generic strip mall of big box stores; that sort of thing already exists a few miles down the road anyway and has been growing tremendously over the past several years.

In addition, the shift from an enclosed mall portion to the development to open-air may reflect popular trends right now, but let’s get a few things straight. For one, consider the average temperature in Wisconsin in January is 15 degrees. Who wants to walk around a pretend-village going store to store in the winter? Or even when it’s raining? Or really hot? That brings us to another point. Many of these open-air “Lifestyle Centers” are the same vapid looking, whitewashed village downtown, often built in suburban areas on reclaimed farmland and consist of the same group of stores often found in enclosed malls. What’s the deal with this? These developments become even more ridiculous when the concrete sea of parking lots surrounding them really makes them nothing better than glorified strip malls; they aren’t that nice. Let’s not have one of these?

In other news, Levitz Furniture appears to be closing up shop following an auction of its assets. The New York-based chain has also given many employees hints they may be permanently layed off in January, even though the winning bidder has not indicated whether they will liquidate the stores and give up, or resume doing business. Levitz has not been doing well for some time, having scaled back significantly from having a nationwide operation several years ago to focusing on core markets on the west coast and New York metropolitan area today.

And finally, a little bit of fun. We’ve unearthed a vintage mall tour from 1987 of the now-defunct Crystal Point Mall in Crystal Lake, Illinois, posted on YouTube. Located about 40 miles northwest of Chicago, Crystal Point Mall existed from 1976-1998 and was McHenry County’s only regional enclosed mall. It was anchored by Joseph Spiess and Robert Hall Village, which later became K-Mart. In 1996, Spiess went out of business and K-mart soon closed off their mall entrance, and the mall’s in-line stores slowly vacated as their leases weren’t renewed because the owner wanted a strip mall with big box stores, and not an enclosed mall. You can read more about Crystal Point Mall at Lisa’s neat retro page all about the mall, complete with photos.

Peek Peek Sneak About

Interior of clandestine Providence Place Mall apartment

(photo via trummerkind.com)

As some of you have noticed, we’ve been having some server issues the past few days. That’s part of the reason we haven’t gotten much content up lately, but trust me, we’re working on something pretty neat.

Here’s some miscellany to tide you over, in case you’re starving for some mall-related reading:

An artist who set up a secret apartment inside of the Providence Place Mall in Providence, Rhode Island gets probation. Usually when people talk about apartments or condos at the mall, this isn’t what they have in mind:

“Michael Townsend, 36, said he and seven other artists built the apartment in a 750-square-foot loft in the parking garage four years ago and lived there for up to three weeks at a time while documenting mall life.

“The apartment included a sectional sofa and love seat, coffee and breakfast tables, chairs, lamps, rugs, paintings, a hutch filled with china, a waffle iron, TV and Sony Playstation 2 — although a burglar broke in and stole the Playstation last spring, Townsend said. The artists built a cinderblock wall and nondescript utility door to keep the loft hidden from the outside world.”

You can read about the clandestine mall apartment, watch a video about it, and see some photos at a website they established for it. According to a whois search, their site has been online since February. And it took mall management that long to find it?

Tee Pee Motel in Wharton, Texas

(photo from CNN.com)

Also, this isn’t mall-related, but it is about a unique piece of 20th century commercial architecture that’s been saved:

“As in the Tee Pee Motel, a throwback to the 1940s and ’50s, when taking a drive was still in style and roadside businesses used gimmicky architecture — like a gas station that looked like an oil derrick — to lure customers. The Tee Pee Motel is one of just a handful of tepee-themed lodges left in the country.

For years, however, Wharton’s Tee Pee Motel was little more than eleven gutted shells engulfed by a tangle of overgrown weeds and a broken sign that once beckoned guests with neon lights and an image of an American Indian chief.”

Retail Weekend Update

Hudson, NH Lifestyle Plans Canceled

Much to no one’s surprise, W/S Development’s bizarrely ambitious plans to build a lifestyle center with several million square feet of space in Hudson, New Hampshire, were canceled this week. We wrote about this plan a couple months back, and said that it would basically spell a Mr. Yuk for the completely successful (and completely fine) Pheasant Lane Mall just a mile or so away. Apparently now W/S Development is teaming up with New England Development (the firm run by Steven Karp, who is responsible for building many of New England’s most powerful shopping malls in the ’80s and ’90s before selling most to Simon) to build a much smaller lifestyle center, Nashua Landing (pictured above), in Nashua. They say “competition for the most desirable retail stores” was at the heart of the decision, a big “no kidding!” statement if there ever was one.

Macy’s State Street Flagship in Chicago “Doing Badly”

(via RetailTrafficCourt) The former Marshall-Field’s flagship store in downtown Chicago, which was the site of anti-Macy’s protests when they removed the store’s banner in September 2006, is apparently doing poorly. Actually, performance of all of the former May stores has been disappointing, but the Chicago store is quickly turning into a pit for Federated, and is generating little traffic nowadays. It seems the dire predictions of a backlash–at least in Chicago–were at least partially true (though do remember that The Bon-Ton recently shut the Carson Pirie Scott flagship in this same shopping district, so we can’t *completely* jump to conclusions…)

Charles Lazarus, Former Chairman of Lazarus Stores, Dead at 93

“Charles Y. Lazarus, whose family name stood for department-store shopping in Columbus and much of the Midwest for more than a century, died this morning. He was 93.Known to friends and associates as “Mr. Charles,” he was the last family member to run the Lazarus department store chain, which started in 1851 as a one-room men’s clothing store on S. High Street and grew to more than 40 stores in five states.

“The Lazarus name was removed from stores in 2005 by corporate parent Federated Department Stores and replaced with Macy’s.

“The Lazarus family of Columbus was instrumental in founding Federated during the Great Depression along with Abraham & Straus of Brooklyn, Filene’s of Boston and Bloomingdale’s of New York City.” Read more.

Latham Circle Mall to Explore New Lifestyle

The aging Latham Circle Mall, featured on this site in February, is going to be extensively renovated beginning this summer. While the Albany-area mall will not be fully disenclosed, much of its focus will be turned back outside, including the addition of an outdoor courtyard in the center of the existing mall, which will feature al fresco dining. The existing food court will also become a new anchor store.

Patriot Place Construction Underway

A large feature in the Boston Globe today discusses the Patriot Place retail development in Foxborough, Massachusetts, on the site of Gillette Stadium, home of the New England Patriots. The Patriots are the only major New England sports team whose stadium is located (well) outside of Boston, and owners Robert and Jonathan Kraft are building a 1.3 million square-foot retail and entertainment complex around the existing stadium. The Globe article also includes a 3D rendering of the project as well as an artist’s rendering, plus video of the construction.

The project, known as Patriot Place, has 1.3 million square feet, anchored by powerhouse merchants such as outdoor retailer Bass Pro Shops. Other major attractions include a Patriots museum, a sports medicine and healthcare clinic, a 500-seat jazz club, and a high-end movie theater with reserved seating and concierge service. The first phase is set to open this fall as the football season and holiday shopping season are in full swing.

Christmas Tree Shops and Victoria’s Secret are two of the first confirmed tenants.

Mr. Yuk Goes to Hudson

A marvel of the 21st century is that Labelscar has a great little tool called web analytics where I can see (amongst other things) the search terms that people use to access our site. While I generally keep my day job separate from my goings-on as a mall geek, I don’t mind mentioning that I work in the burgeoning search marketing industry, which is really just a long-winded way of saying that I find the *way* that people find us to be sort of fascinating. But beyond that, sometimes it gives me good leads on retail-related news.

It was based on such a query that caused someone to stumble upon this site–something about “new mall hudson”–that lead me to find that W/S Development, a well-known New England developer of lifestyle centers, recently introduced the proposed lifestyle center to end all others, a gigantic riverfront development to be built on the site of a current golf course in Hudson, New Hampshire.

At first glance, I can see some pluses and minuses of this project, although admittedly I haven’t seen many of the details about it. First, the good: despite that it’s a lifestyle center, it appears to replicate a genuine streetscape, with blocks and neighborhoods (including a fashion-oriented “Pavilion Buildings” neighborhood, and a more nightlife-centric “Theater District,” amongst others), a riverfront performing arts theater and resort hotel, a residential component, and a variety of other features. In essence, this is a brand new, destinational downtown for the deep suburbia of the Merrimack Valley, a place that will serve as a super-regional destination for all of the densely populated suburbs stretching north of Boston (and into New Hampshire) for 60 miles. That could be sort of neat.

The bad, of course, is notable. The immediate thing that jumps to mind is that the site–while currently somewhat off the way, retail-wise, is very close to the Daniel Webster Highway in Nashua, along with the Pheasant Lane Mall, which is currently one of the largest retail strips in all of New England. While I’ve learned from the guys at Freakonomics that these things tend to do better when clustered together (rather than spaced apart, as you might think), it still seems that the sheer magnitude of this project–which is being touted as the largest mall in New England, thus implying the square footage will exceed 2 million–will likely require that it steals a substantial amount of stores from the thriving Pheasant Lane Mall and its adjacent retail strip, setting the stage for another visit from Mr. Yuk. This is to say nothing of the impact to downtown Nashua and downtown Lowell, which like most older industrial cities have been staging a comeback, mainly in the form of new restaurants and entertainment.

And the other elephant in the room is the Tewksbury Mills project, whose status is unknown now that Mills is to be acquired by Simon. Will Simon want to move forward with the Tewksbury Mills project–which serves a more underutilized slice of the same portion of the metropolitan area–or will W/S Development’s much more ambitious and massive project be the ultimate retail winner, and what could it mean for the many surrounding retail developments?

Bye Bye Bye: CompUSA to Slice Itself in Half, Federated Department Stores is No More

There’s some big retail news today:

CompUSA. Image: Gizmodo.com

CompUSA, which has long been struggling against rivals Best Buy and Circuit City, and who seem to have lost the geek market to more specialty chains like MicroCenter, will be closing 126 stores, more than half of their remaining store fleet, throughout the country. They’ll be pulling out of many major markets, including Dallas and Boston, entirely.

Macy's store at Meadows Mall in Las Vegas, Nevada

The inevitable has occurred: Federated Department Stores is no more. No, they’re not closing, but they’ve decided to abandon the increasingly-esoteric company name in favor of rebranding the entire chain as Macy’s Group, Inc. The article also notes that Macy’s same-store sales are up, but that they continue to disappoint at former May-branded stores.

The End of South Street Seaport? New York City Mall May Be Demolished

Since 1983, the South Street Seaport has been one of the country’s most famous “festival marketplace” style shopping malls. Built as part of a craze to introduce suburban style shopping hubs in the center of cities, festival marketplaces were designed to try and stop the loss of shoppers to the suburbs and revitalize struggling cities by building a retail critical mass within cities. Unlike most malls, they tended to be designed specifically with tourists and suburbanites in mind, presenting a somewhat sanitized, self-contained version of city life designed to allay fears of crime and blight that were associated with major cities in the ’70s and ’80s.

Major cities like New York and Boston (whose Faneuil Hall Marketplace probably stands as the country’s most successful development of this kind) didn’t experience this loss of shoppers and tourists as acutely as many mid-sized cities, but developments like South Street helped keep the shoppers coming, and carried parts of America’s big cities through their most troubled days a few decades back. By and large, the Festival Marketplace craze wasn’t terribly successful, but South Street Seaport stood as one of its most prominent success stories into the 2000s.

Unfortunately, it seems as though South Street–which is still a bustling center today–may have outlived its usefulness. Retail Traffic Court alerted us to this story, which announces that General Growth Properties, the management company in charge of the center, plans to raze the center in favor of a tall building and ferry landing, leaving the remainder of the pier as open space. I believe the inland (and older) portions of the development are designated as historic, so they’re likely not going anywhere. The 24-year-old shopping mall, however, may soon be history.