NEW YORK — At a time when few new malls are being built in the U.S., the Australian developer Westfield is reinvesting in existing properties in an effort to squeeze more profits from them.
This story first appeared in the December 4, 2013 issue of WWD. Subscribe Today.
A prime example is Westfield Garden State Plaza, located 12 miles northwest of Manhattan in Paramus, N.J., where a fashion district is under construction. A new parking deck for the addition was completed in November. The cost of the project is $160 million, said Bryan Gaus, senior general manager of Westfield Garden State Plaza.
The 55,000-square-foot addition will accommodate 23 retailers opening in March, including Tory Burch, Vince Camuto, Maje, Sandro, Scotch & Soda, A|X Armani Exchange and Microsoft, bringing the center to 2.2 million square feet of leasable space. The upper level, where most of the stores are located, is about 35,000 square feet. A 20,000-square-foot retail space on the ground floor has yet to be leased.
At the same time that the fashion district is being built, the center is focusing on upscale retail and filling out a section of the first floor near Tiffany & Co., Gucci and Louis Vuitton that Westfield sees becoming a luxury district. “We’re looking to expand luxury. This is a bedroom community of Manhattan,” Gaus said, explaining that customers in the area are sophisticated.
A new seating section with Knoll Carerra marble tables, Tom Dixon chairs, custom lighting and a concierge desk is opening. A new valet parking service has been introduced to cater to shoppers of Neiman Marcus and the other high-end stores as well as the new fashion district.
Burch is opening a 3,000-square-foot store in the district. The large corner unit, with a 25-foot-high facade, is at the entrance to the new wing, which is strategically located near Neiman’s. High-end materials are being used to build the new wing, such as Carerra marble on floors and a custom chandelier outside Neiman’s. “This is the closest Neiman Marcus to Manhattan,” Gaus said. “We want to honor that.”
A|X Armani Exchange is moving from another location in the mall and opening a 4,200-square-foot store based on a new prototype. Several international retailers will open their first U.S. stores or first stores in the market at Garden State Plaza. The lesser-known retailers will give a boutiquelike vibe to the district, said Velda Turan, vice president of leasing, Northwest regional office.
Kiko Makeup Milano will launch its first U.S. unit at the mall. “They’re all over Europe,” Turan said. “They have a pretty aggressive U.S. [expansion] plan.” Triumph intimate apparel will unveil its third U.S. store and Robin’s Jean, a high-end denim purveyor with stores in SoHo and Beverly Hills, will open.
Lululemon’s new Ivivva concept is geared to tween girls with yoga and lifestyle apparel. “They only have a handful of stores in Canada,” she said. There’s also Havaianas, which will launch one of its first permanent stores; others have been short-term units or pop-ups. Lush and Urban Outfitters are moving from elsewhere in the mall and expanding, Lush from 450 square feet to 1,200 square feet and Urban from 8,500 square feet to 14,000 square feet on two levels.
“Technology is a big category,” Gaus said, noting that Microsoft will open a 4,200-square-foot unit similar to its popular pop-up in Times Square last year. With only 82 stores in the U.S., Canada and Puerto Rico, Microsoft has been choosy about its real estate. Said Kelly Soligon, senior director of marketing and experiences for Microsoft retail stores, “We’re looking forward to opening at Westfield Garden State Plaza, where customers will be able to experience the choice, value and service our stores are known for.”
Gaus said, “We’re selecting brands that meet if not exceed our current average sales per square foot.” Garden State Plaza is highly productive, with sales of more than $775 per square foot, well above the national average of $455, according to Retail Property Insights.
Food will add another element to the district with Max Brenner Chocolate Café opening its first unit outside Manhattan, and Starbucks’ first location in the mall.