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NEW YORK — The owners of Manhattan Mall in Herald Square, after several reinventions, hundreds of millions of dollars in renovations and dozens of changes to the tenant roster, think they finally have the formula right.

The chemistry is simple: With a little more than 50 stores, Manhattan Mall is targeting value and fashion, intent on maximizing its location at one of New York City’s busiest crossroads. The mall, which opened in 1989, has never tried to overreach with high prices. Stores such as Charlotte Russe, Aéropostale, Wet Seal and Strawberry cater to trendy young customers, while Jimmy’Z, a new concept from Aéropostale, opened in November and is geared to 18- to 25-year-old men and women. Enzo Angiolini, Nine West, Victoria’s Secret, Express and the Body Shop have broader appeal.

Budget-minded families shop at the Children’s Place and Steve & Barry’s, a warehouse-sized store, where all the apparel is priced under $10. Hard goods are underrepresented in the mall. Suncoast Video is closing, leaving Radio Shack, KB Toys and Brookstone.

“We’re focused on driving sales per square foot,” said Mark Teitelbaum, chief operating officer of Argent Ventures, which operates Manhattan Mall and is redeveloping the former Omni property in downtown Miami.

“We offer a great combination of retailers,” Teitelbaum said. “We have the only Steve & Barry, Charlotte Russe and Jimmy’Z in Manhattan. We’re always trying to tweak things and push things a little.” A Mets Clubhouse store opened on Friday.

Sales per square foot are between $900 to $1,000 and “we see that going up to $1,200,” he said. “That’s where it should be.”

Manhattan Mall is more productive than some of the top centers in the U.S. Taubman Centers Inc.’s portfolio of malls registers the highest sales per square foot in the industry, averaging $477 in 2004, although that figure includes department store anchors, which generate lower sales and bring down the average. One of the most successful centers, the Forum Shops at Caesar’s Palace, in Las Vegas, generates sales of $1,400 per square foot.

Even when it had the wrong mix of tenants and too much retail space, Manhattan Mall, on Sixth Avenue between 33rd and 34th Streets, had several positives, including its proximity to attractions such as the Empire State Building, Madison Square Garden and Macy’s flagship, as well as its location atop the nexus of a half-dozen subway lines.

This story first appeared in the May 8, 2006 issue of WWD. Subscribe Today.

The nine-story glass-encased Manhattan Mall has a checkered past. The original structure was built in 1910 as the flagship of the Gimbel’s department store chain. Gimbel’s closed in 1987 and two years later, the building was turned into a shopping center.

The mall was initially known as A&S Plaza, named after its first anchor, Abraham & Straus. When Federated Department Stores closed the A&S chain in 1995, the store was converted to Stern’s, another Federated nameplate. Federated shuttered Stern’s in 2001, leaving a 300,000-square-foot void in the mall.

“In the later years, Stern’s brought less and less traffic and had a negative impact at the end,” Teitelbaum said. “They almost helped us along by closing. We knew Stern’s wasn’t the right fit.”

Eventually, the Stern’s space was broken up and leased to several tenants. The mall’s larger stores, Steve & Barry’s, Charlotte Russe, Strawberry and Square One Shoes, occupy the former Stern’s.

The rising rents on 34th Street have made Manhattan Mall attractive to some retailers, said Lisa Rosenthal, a broker at Ripko NYC, the mall’s exclusive leasing agent. Rents along 34th Street range between $300 and $400 per square foot, while the mall charges about $150.

“There’s multiple tenants with stores on 34th Street and Manhattan Mall,” she said, citing Express, Sunglass Hut, Nine West, Victoria’s Secret and Children’s Place. Rather than open second stores on 34th Street as H&M did, some retailers are opting for the mall, she said.

Manhattan Mall opened with nine levels of retail but struggled for years in the retail-only format. At different times the property was managed by Urban Retail Properties and Simon Property Group. In 1998, the mall was sold to Argent Ventures and Lehman Bros. HauInvest Global paid $400 million in 2004, buying out Lehman Bros. Argent has maintained a significant, though unspecified, interest in the property.

Argent recognized that it would never be easy to get consumers to shop on the upper levels. There were too many floors of retail, making the selection overwhelming to consumers, some of whom decided that the higher floors weren’t worth their time and trouble. Four years ago, Argent scaled back the retail to four floors, converting the top five levels to office space.

“Frankly, even though we decided to recapture the space and turn it into Class A office space, the retailers on the higher levels did $500 or $600 a square foot,” Teitelbaum said. “Those tenants didn’t want to leave. They were doing well. But it wasn’t the highest and best use for the space. The rents have gone up for office space,” which is about $45 a square foot. Office rents are anticipated to increase in the next 18 months.

Manhattan Mall will never win design awards. It’s basically a hodgepodge of styles and materials, with faux foliage and a glass elevator. But in 2004, the glitzy neon signage was retired along with the “People’s Court” television show studio on the lower level, which made way for the food court. While there’s no Bouchon or Per Se — restaurants located at the upscale Shops at Columbus Circle — shoppers seem content to nosh at Ranch 1, Sbarro and Nathan’s. Teitelbaum said the food court is thriving.

The building has undergone more than $500 million in renovations since 1989, Teitelbaum said, and $70 million has been spent to upgrade the elevators, reclad the facade on the lower floors with stainless steel and reconfigure the retail space.

Manhattan Mall will never be a high-end shopping center with designer boutiques, but that doesn’t mean quality and prices can’t inch up gradually, Teitelbaum said.

“You want to go to the upper limit of where your customers are,” he explained. “One thing I’ve learned about retailing is that you’ve got to keep moving. Stores go in and out of favor.”

Teitelbaum said the mall could support a store that is the caliber of Coach, although that is unlikely because Coach is already sold at Macy’s.

The mall’s customer has changed as the neighborhood has evolved, Teitelbaum said.

“There’s full-time office workers in the building and in nearby buildings, there’s tourists, there’s real destination shoppers coming from the boroughs and there’s residents that live in the area, which is something you didn’t have 10 years ago,” Teitelbaum said. Now, with new luxury condos rising in the neighborhood, there’s a larger local population.

Teitelbaum said the mall has only about 4,000 square feet of vacant space out of 180,000 square feet. “We’re in the position to be a little more selective,” he said.