REAL ESTATE

Nordstrom to move locations in Kansas City

BY Al Urbanski

Nordstrom is trading locations in Kansas City, announcing plans to move to the town’s largest open-air urban shopping center in 2021.

The upscale department store opened at CBL’s Oak Park Mall in 1998 and will continue operating there until the new store opens at Country Club Plaza, located near the Kansas City campus of the University of Missouri.

“We’ve been fortunate to be able to serve our customers in this market at Oak Park Mall for the past 20 years and look forward to offering them a new shopping experience at Country Club Plaza,” said Jamie Nordstrom, president of stores for Nordstrom.

Nordstrom’s new location will be within a 15-block urban center owned jointly by Taubman Centers and Macerich. The 1.3-million-sq.-ft. Country Club Plaza is home to the kind of high-end retailers Nordstrom likes to mix with. Among them: Apple, Burberry, The Coach Store, Sur La Table, lululemon, and Michael Kors.

CBL, which has been actively reclaiming department stores in its portfolio and replacing them with more experiential brands, views Nordstrom’s departure as an opportunity.

“The retail environment is changing rapidly and this decision provides us with an excellent opportunity to transform Oak Park for even greater success in the future,” said CBL Director of Public Relations Stacey Keating. “Nordstrom will remain at Oak Park until 2021. Between now and then, our team has ample time to evaluate various redevelopment scenarios in order to create the plan that makes the most sense for the market.”

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Retail re-do at Empire State Building

BY Al Urbanski

The world’s most famous skyscraper is undertaking the first gut rehab of all its retail space since it opened its doors in 1931.

New York’s Empire State Building will be re-marketing some 50,000 sq. ft. of retail space, perhaps the most it has ever had available at one time, according to a report on Bloomberg.com.

Skyrocketing retail rents have forced many shops and eateries to abandon Manhattan, leaving scattered holes in the grid at street level. Rents are now dropping in the Herald Square area, as they will at the Empire State Building, whose main incomes stream comes from the 4 million tourists who visit its observation deck annually.

Joanne Podell, executive VP of retail services at Cushman & Wakefield, leasing agent for property, feels the Empire State has an advantage.

“Tenants that are in the market looking for a location with high density along a shopping corridor, I would think they would make this one of their priorities,” Podell said.

Empire State Realty Trust collected just $5.6 million in retail rents last year, down from $7.2 million in 2016.

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Survey: Signs point to positive year for retailers

BY Marianne Wilson

Retail tenants in the Northeast are feeling positive about store prospects for 2018.

That’s according to real estate services firm Levin Management Corp.’s 2018 Retail Sentiment Survey in which 68.1% of survey respondents indicated they are feeling optimistic about 2018 store performance.

“A relatively strong economy, historically low unemployment and growing consumer confidence set the stage for ongoing improvement for retail in 2018,” said LMC President Matthew K. Harding. “Kiplinger anticipates in-store sales will grow 2.4% in 2018, the strongest advancement since 2014. With no foreseeable major changes on the horizon, we, too, anticipate another year of continued momentum.”

LMC also asked tenants whether their companies anticipate opening additional stores in 2018 and 30.4% answered in the affirmative.

“We continue to hear about planned store closings, yet this is an important reminder that retail is an industry of constant evolution,” Harding said. “As some concepts reach their end, others expand and thrive. It is encouraging to see so many of our survey respondents fitting into the latter category.”

LMC asked its retail tenants whether low unemployment has brought noticeable change to the hiring climate. More than one quarter (28.2%) of survey participants indicated they have observed some shifts. Of those respondents, 63.3% are seeing fewer qualified job candidates in their pools of applicants. Additionally, 53.3% reported demand for higher starting salaries, with 20% indicating demand for more employee incentives.

Still, the ability to prosper in today’s increasingly digital and mobile world requires retailers to embrace shifting strategies. Nearly half (49.6%) of LMC’s 2018 Outlook survey respondents indicated they have adapted their business model in response to the growth of ecommerce. The most popular changes involve heightened focus on technology and service.

Of those survey participants whose companies have made changes, 54.3% have increased their use of technology-centered marketing tools in-store, while 56.3% have upped technology-centered marketing to reach customers outside the store.

Other strategic shifts embraced by more than half of those that have made changes include increased training and focus on customer service (58.9%), and added in-store services and incentives (51.0%).

“Our survey indicates retailers are using multiple avenues to distinguish themselves and win business,” noted Melissa Sievwright, LMC’s vice president of marketing. “It has become clear they are leveraging technology to get consumers’ attention and enrich the in-store shopping experience. There are elements of touch, feel and interaction in a physical store than cannot be duplicated online. The emphasis on training and service reflects that our tenants understand what is important to their customers today.”

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