ZALE’S EYES SITES IN MANHATTAN
Byline: Melanie Kletter
NEW YORK — Zale Corp. is ready to take Manhattan.
The nation’s largest jewelry retailer has retained retail real estate firm Robert K. Futterman to help find Manhattan sites, with the intent of opening five stores here over the next 18 months.
“We see this as another opportunity for growth,” said Mary Forte, Zale’s executive vice president and chief administrative officer. “We have stores in Staten Island and northern New Jersey, and we are ready to come to the island.”
She said the company feels it has the potential to open between 20 and 25 stores in New York over the next four to five years.
Zale has not yet signed any deals here, but is eyeing a variety of neighborhoods, including midtown, SoHo, the Flatiron district, and the Upper East and Upper West Sides. The company is looking for sites in the range of about 1,800 to 3,000 square feet, according to Futterman executives.
The move marks somewhat of a departure for Zale, which primarily operates mall-based stores. The publicly traded firm now operates about 1,350 stores under its various divisions, which include Zales Jewelers, Bailey Banks & Biddle, Gordon’s Jewelers and the Canadian-based Peoples Jewellers chain. The company also sells jewelry over its Web site, Zale.com, and in its outlet stores.
Forte noted that the firm is still “very much” mall based and is planning to open 78 new mall stores in addition to the five Manhattan locations in its fiscal year beginning Aug. 1. She said the firm does not have specific plans to open Zales stores in any other urban areas at this time, but is “evaluating everything.”
Forte also said that its Bailey Banks & Biddle division may also open a few stores in Manhattan at a later date. Late last year, Bailey, Banks & Biddle, the company’s most upscale division, opened stores in downtown Seattle, Mission Viejo, Calif., and Boston. Based in Irving, Tex., Zale has been on a massive growth spurt lately. In addition to opening the Bailey Banks & Biddle stores, the firm last year purchased the 175-unit Peoples Jewellers Corp. It has also beefed up its Web site and opened new outlet stores. The company has said it expects its e-commerce division to be a $100 million business in the next three to five years. The company has also seen a strong financial performance on Wall Street. In its most recent quarter ended Jan. 31, Zale’s earnings climbed 31.3 percent to $84 million, or $2.33 a share. Sales advanced 29.6 percent to $736 million, with same-store sales surging 14.4 percent.
Zale recently scored a $225 million five-year working capital facility led by Fleet National Bank, which will help support the company’s expansion plans, Forte noted.