Though the panel specifically addressed the replacement of Robinsons-May stores, centers around the country are facing empty anchors because of department-store consolidation. Developers are using a variety of methods to fill the space.
"Recent options include tearing down and subdividing the space, transforming the space into another use, or replacing it with another big box," said panel moderator Marios Savopoulos, a principal at Perkowitz + Ruth Architects, Long Beach, CA.
Which option to use isn't solely a developer's decision, said panelist Emerick Corsi, executive vice president with Forest City Enterprises, Cleveland.<P."A lot of things go back into the decision-making, including the financing, the reciprocal easement agreements and the cotenancies tied to the anchors," he said. The municipality, too, often is a factor if public monies helped build a project.
The merger isn't the only reason a developer might find an unexpected anchor vacancy. At Forest City's Short Pump Town Center, near Richmond, VA, Lord & Taylor declined to begin construction on its pad even as the rest of the 1.3 million-square-foot center was being built. Possibilities included bringing in another department store, such as JC Penney, or big boxes Home Depot or Target.
"But our tenant mix was upscale," he said. Instead, Forest City built a new wing with Cheesecake Factory, Urban Outfitters and West Elm and other specialty tenants. The wing added $70 million in sales annually to the mall, far more than Forest City expected from Lord & Taylor.
In other situations, Target could be a perfect answer, even in an upscale center, said panelist William J. Stone, a principal of San Diego-based Excel Realty Holdings.
"A situation where you have Target next to Nordstrom should be a dichotomy," Stone said. "But they market to the same people."
Wal-Mart also is a possibility, though not in upscale projects. Even Kohl's is now building larger units and moving into the mall.
Specialty stores, too, are possibilities, Stone added, if they are combined. H&M is moving into malls, and "Forever 21 went from 7,000 sf specialty stores to 50,000 sf department stores. It's an exciting time in the industry."
Still other companies are looking to change the use completely, replacing retail with office space, civic uses such as libraries or even residential units in accordance with current trends.
In some cases, replacing the tenant is not an option. Recently, Forest City has obliged Federated to operate two Macy's in the same center.
"Will that be a good decision?" Corsi asked. "Time will tell."
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