AT&T’s High-Tech, High-Touch Flagship
AT&T’s first-ever flagship is designed to immerse customers in everything AT&T. The 10,000-sq.-ft. emporium, located at 600 N. Michigan Ave. in Chicago, also offers shoppers a peek into the future, with the first-ever retail demonstrations of the company’s new digital home security system and an example of how wireless technology can help driving via an on-site “connected” car.
“The store is about bringing AT&T technology and the brand to life for our customers,” said Christina Cheng, general manager, flagship store, AT&T. “And we do that by inviting them to try out the various technologies on display and by highlighting how our technology can improve their lives.”
To that end, the store takes a hands-on, experiential approach to retailing that allows customers to check out the latest smartphones, tablets and other mobile devices, while also helping them to understand and experience the role of evolving technology in their daily lives — and, hopefully, to take home the message that AT&T is ahead of the pack. Accordingly, the space is outfitted with the latest in digital wizardry, from Microsoft Surface tables to 100 dazzling video displays. But AT&T hasn’t lost sight of the importance of the human touch. There are plenty of employees on hand to assist.
“It’s very important to make customers feel at ease,” Cheng said, “and the level of comfort is determined by the employees they interact with. Our customers are welcomed by very friendly employees who put them at ease and help them navigate the space.”
One of the first things customers see on entering is an 18-ft.-high wall of video screens that shows interactive content, customer announcements and product information. (The atrium includes a touchscreen table loaded with AT&T’s favorite apps available for AT&T, Sprint and Verizon, which are downloadable on the spot.)
Highlights of the store include the Explorer Lounge, where shoppers can play with and learn about various apps on interactive Surface tables that display various apps categories. Shoppers can tap them to explore different apps.
“Looking at apps can be intimidating because there are so many to choose from,” Cheng explained. “We try to make it easy for people to find out which ones are fun and most useful for them. You can sync your phone right to the table and have the apps downloaded on the spot to your phone. And anyone can have the experience — not just AT&T customers.”
Customers who want more personal attention can get it at the Apps Bar, where associates (called “app-tenders”) serve up one-on-one and group demos, which are also displayed on multiple video monitors on an adjacent wall.
The store’s open layout includes a series of lifestyle boutiques, which display products, apps and accessories organized according to customer needs. One of the boutiques, “Chicagoland,” features Chicago-themed apps and products. The “Get Fit” boutique” has health and fitness apps, as well as health-related merchandise, such as a clip that a person can wear to monitor daily activity.
“We can also show you how everything can be synced together and how it all works in real life,” Cheng said.
Further back in the store, a space called The Gallery showcases artwork from artists with Chicago ties, and also displays limited edition, custom-designed phone cases.
Another part of the store, the Experience Platform, features dedicated spaces to AT&T products for home security, entertainment, music and automobiles. The Street Smart space features an all-electric 2012 Nissan Leaf car and shows the future of automotive connectivity, safety and efficiency.
“Customers can get in the car and experience how all the products work,” Cheng said.
It’s important to point out that the technology at the new AT&T isn’t just for the customers. For the first time in its retail stores, the company is using biometric technology, with its employees using their fingerprints to open cash draws.
“It’s a lot easier in that you don’t have to worry about who you give keys to,” Cheng added.
Also, there is no waiting in line to check out at a counter. Instead, the store features mobile POS.
Design: The store has a streamlined, modern look, with a mostly white palette that puts the spotlight on the experience. The use of natural wood (primarily reclaimed teak wood) throughout warms up the space and goes a long way to enhancing the environment. Comfortable couches and chairs provide relaxed seating.
“Technology can sometimes be a little cold,” Cheng said. “But the wood really helps warm up the store.”
The teak wood is only one element of the eco-friendly orientation of the store, which was designed and built with sustainable materials and practices. The use of energy-efficient lighting, temperature controls and Energy Star appliances contributes to reduced energy and water consumption.
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Focus on: America’s Top Redevelopers
In its eighth year, the annual Top Redevelopers survey continues to underscore the country’s emphasis on refurbishing and repositioning over building anew. Just as in the prior seven years, shopping center owners are concentrating on existing assets — sometimes tweaking, sometimes refreshing, sometimes razing sections and rebuilding. For all, however, the goal is to maximize exposure and returns for all the tenants involved.
Just as last year, the time frame analyzed is mid-year to mid-year — in this case, June 2011 to June 2012 — to garner the most current results possible. Entrants submitted total square footage redeveloped during that one-year period, number of projects tackled and, when available, financial investment for each. As always, Chain Store Age’s judging committee attempted to make the selection process as objective as possible, but that’s not easy. Not enough information is available to formulate a totally foolproof ranking system. Only a handful of developers report financial investments in redeveloped projects, and many tally redevelopment square footage in differing ways.
Of all the entries evaluated, we chose 10 based on number of properties redeveloped, total square footage impacted and significant projects. They are listed alphabetically, because it would be impossible to rank one above the other. This year, we also included two honorable mentions — the significance of the projects warranted the additional coverage.
Brixmor Property Group
New York, N.Y.
In the 12-month period between June 1, 2011, and May 30, 2012, Brixmor Property Group redeveloped 14 properties in nine states and invested about $31 million. Although the largest project tackled was Roosevelt Mall in Philadelphia, the developer counts Sarasota Village, in Sarasota, Fla., as its most significant. The community shopping center featured a successful but outdated Publix, along with Big Lots, Crunch and HomeGoods. A new 46,000-sq.-ft. prototypical and state-of-the-art Publix was constructed to replace the existing 37,000-sq.-ft. footprint, and Brixmor made additional renovations to the shopping center to make it a vibrant part of the community.
Cafaro’s 2 million-plus sq. ft. of redevelopments was comprised of two major projects: Kentucky Oaks Mall, in Paducah, Ky., and Huntington Mall, in Bridgeport, Va. Both involved top-to-bottom renovation of older enclosed shopping malls, including flooring replacement and updating of plumbing and roof surfaces. Cafaro installed new entrances to both malls, updated the HVAC and lighting systems to energy-efficient iterations, added skylights, soft seating, indoor landscaping and family restrooms, as well as created entirely new signage packages for the centers. The redevelopment of Kentucky Oaks affected about 845,000 sq. ft. of its 1.3 million sq. ft.; of Huntington Mall’s 1.5 million sq. ft., 1.2 million was redeveloped.
CBL & Associates Properties
CBL by far redeveloped the most total square footage of this year’s Top 10 Redevelopers; its 5.7 million sq. ft. of redevelopment comprised eight projects in six states. But it counts as its most significant the renovation of the flagship Hamilton Place Mall, in its home base of Chattanooga, Tenn. The complex features a 1.1 million-sq.-ft. regional mall, several associated community and power centers, and an abundance of restaurants on 202 acres. A multimillion-dollar transformation incorporated updated entrances, new interior decor, tile flooring, new restrooms, a modern graphics package and a number of energy-saving elements.
Costa Mesa, Calif.
Donahue Schriber’s sole redevelopment project in the 2011-to-2012-time period is also significant. The company completed a $20 million renovation of its 278,000-sq.-ft. Del Mar Highlands Town Center in San Diego, elevating an already successful community shopping and entertainment center to an entirely new level. What Donahue Schriber termed a “Re-Imagining” process entailed bringing in fresh concepts, such as Top Chef alumnus Brian Malarkey’s acclaimed Burlap restaurant. It also involved debuting the county’s first luxury movie theater, Cinepolis, and elevating the center’s amenities and overall customer service offerings. Post re-imagining, sales have increased to well over $700 per square foot, and NOI has increased by more than 30%. Total center occupancy is at 100%.
EDENS invested $67.2 million on redeveloping eight projects during the 2011-to-2012-time period, but none are more important than its redevelopment of Middlesex Commons, located in Burlington, Mass. For Middlesex Commons, a dominant but underperforming grocery-anchored center in the Boston MSA, EDENS envisioned a return of the 40-year-old shopping institution to a central point of interaction for the neighborhood. Two anchor vacancies provided the right opportunity to redevelop the center toward maximizing its potential. A high-performing Market Basket was relocated into a larger space, the center’s entrance was reconfigured to accommodate outward-facing storefronts, and EDENS employed a variety of techniques to create the desired atmosphere and community engagement.
Kimco Realty Co.
New Hyde Park, N.Y.
A perennial player on Chain Store Age’s Top Redevelopers list, Kimco tackled eight projects in the survey time frame, spending close to $70 million on such projects as the renovation of an entire half-million-sq.-ft. shopping center — Factoria — in Bellevue, Wash. The company, however, points to Elsmere, Del., for its most significant project, as it involved demolishing an existing Value City department store and building a new 85,000-sq.-ft. BJ’s Wholesale Club, along with a new Fuel Island Facility. The area, Kimco said, makes the redevelopment especially noteworthy, as New Castle County offers a strong demographic and heavily populated main retail corridor to the state of Delaware.
Phillips Edison & Co.
Of its 27 redevelopment projects in 2011/2012, Phillips Edison highlights Currier Square, in Oroville, Calif., which the company acquired in 2006. At the time, there were two tenants in a 44,000-sq.-ft. box adjacent to Raley’s: a Chinese buffet that would not be renewed at lease expiration, and a 6,500-sq.-ft. Salvation Army location that ultimately relocated to a larger space across the street. Responding to research data that showed apparel, shoes and jewelry shoppers heading out of town for purchases, Phillips Edison convinced TJX Cos. to bring Marshall’s to the center with a 25,000-sq.-ft. store. Petco followed with a 10,000-sq.-ft. store that opened Oct. 8, and the center went from 55% leased to more than 85% leased in just 12 months.
Another perennial player on our Top Redevelopers list, Regency invested $24.9 million on six redevelopment projects during the survey time frame, none more important than the work it did on Heritage Plaza, a 230,000-sq.-ft. neighborhood center in Irvine, Calif., anchored by Ralphs and acquired by Regency in 1999. Market research, underscored by focus group findings, uncovered a lack of retail options for the Asian demographic, which had grown from 8% to 45% of the total population since the center’s inception in 1981. Regency answered with more Asian-centric concepts such as Daiso, a value variety store, and Japanese supermarket Mitsuwa Marketplace. In addition, Regency improved sight lines and added natural façade finishes, new wayfinding signage, wider pedestrian walkways, gathering places and sidewalk eating areas.
Simon Property Group
Simon showed its redevelopment muscle by revamping 33 projects in 18 U.S. states, Puerto Rico and Japan. The company said its Fashion Valley renovation in San Diego is its most significant, in that the property is the most prestigious retail address in San Diego County, featuring 200 stores and restaurants including Neiman Marcus, Nordstrom, Bloomingdale’s, Tiffany, Louis Vuitton, Gucci, The Cheesecake Factory and P.F. Chang’s. The renovation, said Simon, took Fashion Valley to an even higher level.
Westfield has ranked among Chain Store Age’s Top Redevelopers every year, and this year the shopping center owner renovated Westfield West Covina (Calif.), Westfield Great Northern (N. Olmsted, Ohio), Westfield Fashion Square (Sherman Oaks, Calif.) and Westfield Vancouver (Wash.) — to the tune of $108 million. For Westfield Vancouver, it invested $60 million on the only enclosed shopping center serving southwest Washington State. An extensive redevelopment added a state-of-the-art Cinetopia theater, and the company completed a full-center renovation, remodel and remerchandising of the space formerly occupied by Mervyn’s to include the types of fashion-forward retailers and more sophisticated cuisine offerings long requested by local residents. Brands open now or coming soon include Ann Taylor Loft, Aveda, Aldo, Express, Forever 21, G by Guess and White House | Black Market.
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Taking Energy Management to the Next Level
Energy conservation remains a key priority for retailers as several factors, including new power plant regulations, threaten to increase volatility in the electricity market. Along with being a significant cost driver, energy management advances environmental goals. Indeed, it is typically the most cost-effective activity a retailer can undertake to become more sustainable, according to Marcus Boerkei, general manager of Siemens Retail & Commercial Systems, who spoke with Chain Store Age about how retailers can reduce their energy use.
What is the biggest mistake retailers make when it comes to energy management?
The biggest mistake companies make is not focusing on the information management part of the equation. At this stage in the EMS (Energy Management System) industry’s evolution, the sensors and controls on a location are not nearly as important as what’s ‘above site’ — the dashboards and analytics to help companies manage the gigabytes of data an EMS produces. The ability to automatically prioritize data to make it actionable — to the appropriate stakeholders — is what makes or breaks an energy management program.
How does cutting energy help with maintenance costs?
The answer to this is actually an extension of the previous question. The most successful retailers integrate the analytics provided by an EMS into their HVAC maintenance operations. For example, the system can be used to direct a service provider to pinpoint a particular issue prior to dispatch, and then to verify the work was done correctly.
Or certain issues can be resolved remotely or safely deferred until the next scheduled preventive maintenance visit, eliminating the cost of a site visit altogether. Siemens’ customers have saved millions on their maintenance programs through effective integration of the EMS into their vendor management processes.
What is the next step for retailers that have already picked the low-hanging fruit in terms of saving energy?
This has a three-part answer:
No. 1 is innovation. We are constantly introducing new capabilities and analytics to help retailers increase energy efficiency. These include psychrometric controls, intelligent DCV and advanced override management.
No. 2 is integration. It’s important to involve key stakeholders in the process, from HVAC vendors, as mentioned above, to finance to store design to energy procurement. By integrating these functions, energy management can be viewed as a strategic initiative.
No. 3 is load management. Participating in electricity load management programs, such as demand response or capacity bidding, represents not only an opportunity to reduce usage, but also a means of generating new revenues. By enrolling in such programs, our customers generate hundreds of thousands of dollars each year that they can use to invest in further energy-efficiency initiatives.
How can Siemens help retailers reduce their energy use?
In a nutshell, through effective deployment of the most sophisticated equipment and cloud-hosted software, combined with integrated services and domain expertise. Our focus is on maintaining and expanding a retailer’s energy savings over time. It’s why Michaels Stores increased its savings to 30% last year (for more on Michaels Stores’ energy upgrade, see August/September 2012 issue of Chain Store Age). This notion of continuous advancement of efficiency is the path we’re on with each and every Siemens customer.
How is the Site Controls platform different from other energy management solutions?
The Site Controls platform was designed from the very beginning as an integrated, hosted solution, long before cloud computing was popular. This helps retailers avoid the upfront costs associated with traditional approaches; it allows them to take advantage of continuous innovation for increased savings.
Another key differentiator is our client services support model. For Siemens, energy management isn’t a project, it’s a process — and we’re there as a partner every step of the way.
How do you think energy management solutions/platforms will change or evolve going forward?
It’s all about the software. We’re seeing continuous advancements in analytics and sophisticated control strategies that can be deployed across an enterprise. We’re also seeing the confluence of energy management, facilities management and energy procurement. There are exciting possibilities to integrate these formerly separate functions that will play out for years to come.