BOUGHT IT THROUGH THE GRAPEVINE
THE MILLS CORP. BRINGS ITS VALUE-ORIENTED RETAILING FORMULA TO NORTH TEXAS.

Byline: Julie Vargo

DALLAS — Everything’s bigger in Texas.
At least, that seems to be the premise on which The Mills Corp. is banking for its value-oriented Grapevine Mills megamall.
At its completion, the 1.5 million-square-foot complex will rank as one of the largest shopping centers in the state. The mix of almost 200 stores includes manufacturer’s outlets, department store and specialty retail outlets, off-price retailers, category killers and dining and entertainment venues.
To handle the expected 14 million to 16 million annual visitors, on-site parking will accommodate 8,500 cars.
“Dallas fit our demographics and fit our infrastructure for this project,” said Erick Collazo, development director for The Mills Corp. Collazo has been overseeing the Grapevine project, which is slated to open Oct. 30.
The mammoth mall is located in Grapevine, Tex., two miles north of Dallas/Fort Worth International Airport, and 20 miles from both Dallas and Fort Worth. Thanks to its location, the sprawling complex is designed to appeal to not only the state’s turbo-shoppers and cost-conscious consumer, but also tourists.
Inside, almost a mile of polished wood floors snake through six “main streets” of storefronts and three courtyards. Texas-themed facades, Crayola-bright tints and oversized graphics give the mall an amusement-park atmosphere. Six stylized entrances, each decorated in its own color scheme with unique signage and 40-to-50-foot structural elements — including a colossal Texas flag, huge American flag, and giant football — help customers remember where they parked. Twenty-eight oversized video screens promoting local tenants dot the landscape. An audio system reinforces the video message.
Grapevine Mills is not a traditional outlet center, however, according to Collazo.
“This is not an outlet mall, it’s a value-retail mall,” he said. “Our tenant mix includes department stores and category killers, as well as designer boutiques.”
While not all vendors consider themselves outlets, most entice customers with reduced prices.
“Our leases require retailers to sell at least 25 percent discount,” said Collazo. “This is not required of the anchor tenants. However, we look for anchors who will discount to fit with our value-retail theme.”
The merchant mix at Grapevine Mills is 70 percent women’s, 30 percent men’s. Tenants include Saks Fifth Avenue’s Off 5th outlet, Sports Authority, Group USA, J.C. Penney Outlet Store, Marshalls, Burlington Coat Factory, Off Rodeo Drive Beverly Hills, Dress Barn, Gap Outlet, Maternity Works Outlet, Lenscrafter, Sunglass Hut Outlet, Ultra The Gold And Diamond Outlet, Wilson’s Leather Outlet and Fragrance Depot. The megamall will also house outlets from Old Navy, Bebe, Cache, Donna Karan, Ann Taylor, Liz Claiborne Shoes and Calvin Klein.
The north Texas area is no stranger to outlet malls. Four other centers with a total of 234 stores are located within a 65-mile radius of Grapevine Mills.
“The difference is that [other malls] don’t have anchors to offer as much selection to the customer as we do,” said Collazo. “We are four times as large as our nearest competition. We’re closer to Dallas and Fort Worth. We probably won’t affect the sales of other outlets that are well stored, but as Grapevine Mills stabilizes, we will impact those that are marginal.”
Many Mills tenants will also compete with local stores that try to sell the same goods at full price. The Dallas Galleria, home to Saks Fifth Avenue, Ann Taylor and Coach, is less than a 25-minute drive away.
“Manufacturers don’t want to go into a region and compete with other merchants that carry their goods,” acknowledged Collazo. “But Saks sends out-of-season merchandise and merchandise bought specifically for [the outlet] to their Mills outlets. And by being in our complex, we allow a manufacturer like Coach to capture a customer that might not come into its store in the Galleria.”
These malls are not geared solely for the cost-conscious.
“The same customer who shops high-end will shop with us,” said Collazo. “Saks Fifth Avenue finds that its participation in a Mills project doesn’t affect the sales in its [full-price] store. It actually builds sales and name recognition for stores in that region.”
For manufacturers interested in, but not totally committed to, the concept, Mills Corp. allows test-drives via their Manufacturer at the Mills program.
“We offer short-term, 45-day leases to provide an opportunity for manufacturers to bring in merchandise and fixtures and see how their sales are, how it impacts their other stores,” Collazo said. “If they like it, we can roll their lease.”
While customer traffic in general has declined in suburban malls, and few new regional centers are being built, The Mills Corp. continues to expand its empire of value-oriented regional megamalls.
“The growth in regional malls is slowing down,” Collazo agreed. “The interest, however, is in value-oriented malls like ours.
“We differ from a regular mall in that we offer ‘shoppertainment,”‘ he added. “Our customers don’t come here just to shop.”
In addition to a plethora of stores, Grapevine Mills features a 30-screen AMC theatre — the largest in north Texas. Food venues include The Rainforest Cafe, which boasts animated trees, butterflies and crocodiles, and simulated thunder, lightening and tropical showers. Gameworks, a 21,000-square-foot high tech playground, features virtual-reality simulators. The American Wilderness Experience offers encounters with live animals, plants and various replicated natural environments.
“We focus on things that make it fun for shoppers,” he said. “Our shoppers stay here an average of three hours — three times longer than customers in a regular mall. And hopefully, they buy three times as much.”
Upon opening, The Mills project will create 4,000 jobs and generate sales and real estate tax revenue of about $7 million annually.
“At 10 years, we estimate we will have done $4.5 billion in sales,” said Collazo.
In November, the company will continue the concept, opening the Arizona Mills in Tempe. Other projects currently in development include CityMills in Orange, Calif.; Katy Mills in Houston, and Meadowlands Mills in Carlstadt, N.J.
Collazo noted that the Mills Corp. is also considering a Candlestick Mills venture on the site of Candlestick Park in San Francisco, when and if the 49ers football team builds a new stadium.
Grapevine Mills is a joint development of the Mills Corp., Simon DeBartolo Group and investment adviser Kan Am. The Mills Corporation owns, develops, redevelops, leases, manages and markets a portfolio of five regional, value-oriented megamalls and 11 community shopping centers nationwide. The Simon DeBartolo Group is a self-administered real estate investment trust with a focus on retail real estate.

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