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Dueling Proposals Fracture Dallas Fashion Industry

Competition between two proposals to move Dallas fashion firms out of the International Apparel Mart has intensified as sales reps are dividing into camps.

DALLAS — The wholesale market here might be headed for a split.

This story first appeared in the February 12, 2003 issue of WWD.  Subscribe Today.

The competition between two proposals to move the fashion industry out of the International Apparel Mart has intensified as sales reps are dividing into camps.

Several of the largest firms at the Mart support moving the fashion industry into the nearby World Trade Center in March 2004 as planned by the Dallas Market Center Co., which owns and operates the sprawling campus that houses the Mart, the WTC and other buildings. They say the format is more conducive to doing business for buyers and wholesalers than the alternative skyscraper proposal.

“My customers are excited about it for ease of shopping in a condensed marketplace, and that’s what we’re in business for,” said Brad Hughes, whose eponymous business is one of the largest tenants in the Mart.

Principals of three other big rep firms — Ritz Group, Navia-Plott & Associates and GeNe Sales — have also said they prefer the WTC.

But the maverick proposition from developers to build a new fashion district downtown across from Neiman Marcus has gained supporters, especially among sales representatives with contemporary apparel and trendy accessory lines. They like the promise of a progressive new fashion center with a distinct identity coupled with retail stores, restaurants and other amenities in an urban area.

“I’m totally into the downtown group,” affirmed Cynthia O’Connor, an accessories rep who is based in New York but has a satellite showroom in Dallas. “They are forward thinkers, they are going to get it done, and they are open-minded and passionate about it.”

Other sales reps favoring the downtown proposal include Federico Mariel, Julie Hall, Pam Martin and Summer Paillet.

“The contemporary group is on board,” Mariel said.

The two proposals were made to Mart tenants within three days of each other in late January. Since then, the Dallas Market Center has received more than 500 faxes from tenants requesting space in the WTC, said Bill Winsor, president and chief executive officer. In most cases, tenants do not need to sign new leases since their current contracts at the Apparel Mart can be transferred to the WTC.

“The amount of space required is 5 to 7 percent greater than we anticipated, so we are trying to make room,” he pointed out.

Winsor dismissed the rival plan to convert the historic Mercantile Bank building into a wholesale complex, citing problems with parking, asbestos abatement and insufficient elevators to transport buyers among the tower’s 31 floors.

“I don’t feel threatened by it,” Winsor said. “Anytime anybody announces a competing environment, it creates a distraction, but there are too many issues with respect to that project for it to be a viable alternative. The barriers are pretty dramatic.”

But Paul Stell and Luke Crosland, the lead developers masterminding the downtown project, are pressing ahead. They have made pitches to makers in New York and Los Angeles, and they plan to address concerns about logistics and management at a meeting here next Tuesday.

A key question centers on where sales reps would house their offices and markets in between the Apparel Mart’s closing in March 2004 and the Mercantile building being ready for occupancy as Fashion District Dallas in September 2005.

The developers are working with their architect to move reps into temporary showrooms in a building that is connected to the tower, Stell said. Their original plan had been to tear down this adjacent structure. They also have hired Herbert Mines & Associates to recruit experienced fashion executives for three positions at the complex: manager, merchandiser and marketer. The two developers previously contracted Gerald Sampson, former president of Neiman Marcus, and Henry S. Miller 3rd, a leading Dallas retail developer, as consultants.

“We want everyone to know there is an alternative,” Stell said.

Bud Konheim, chief executive officer of Nicole Miller, said he’s ready to try the downtown center.

“The Dallas market is very viable, but we have to find a place that people really enjoy, that is a real experience,” he said. “If they can make it a user-friendly experience in Dallas, then my experience with ENK and the Coterie tells me they are going to be a howling success. People like to go where they enjoy themselves. If I get that in Dallas, I start thinking that all of South America could be serviced by Dallas if they have fun going there.”

Ironically, other reps cited the Coterie’s logistics as evidence that the downtown proposal would not score well.

“The biggest concern I have [with the Mercantile proposal] is that it is a vertical building, and one of the reasons ENK Coterie and Intermezzo are as successful as they are is because they are horizontal,” theorized Brad Ritz.

He also said that moving a business twice in order to be downtown was cost prohibitive, and that a split in the market would weaken the Dallas industry.

“If 20 percent of this building decides to go downtown, they won’t survive,” Ritz predicted. “We can’t afford to fragment this thing. Ultimately, we all need to work together for the benefit of our customers and the survival of our businesses here.”