West Des Moines, Iowa — Retail may be a tough business, but there are a few sweet moments.
The return of Matthew Bucksbaum, chairman of General Growth Properties Inc., to West Des Moines last year was one of them.
The Bucksbaum family has deep roots in Iowa, where the brothers, Matthew and Martin, ran the family grocery store business. In 1954, they built one of the country’s first malls, the Town and Country Center in Cedar Rapids. When Matthew came back with his son, John, now chief executive officer of General Growth, to celebrate the opening of the Jordan Creek Town Center in West Des Moines in August 2004, the small family operation had blossomed during the half century to become one of the largest developers of retail real estate in the country. According to the Forbes 400 Richest Americans List of 2005, Matthew and his family are now worth $2.4 billion and rank 109th on the list.
“It was an emotional project for our entire family because it was, in a certain way, our crowning achievement,” said John Bucksbaum. “Jordan Creek was built because there was a need for it and it made financial sense. There was no sentimentality or emotion in the process. But when we opened, it was the 50-year anniversary of the company, and to share a project of that magnitude with their friends and their community was a momentous thing for my parents.”
Unlike other properties developed by Matthew and Martin, the $200 million Jordan Creek is a massive, 200-acre shopping and entertainment destination project. It offers an enclosed two-level shopping mall with upscale fashion, an open-air component with large and specialty retailers and, to cap it off, a 3.5-acre lake surrounded by bike trails, walkways, a boardwalk with waterfront dining, a hotel and an amphitheater. Formerly farmland, its anchors include Younkers, Dillard’s, Scheels All Sports, Best Buy, Costco and Old Navy, and the restaurants P.F. Chang’s China Bistro and Bravo Cucina. Roughly 16 million people have visited the center since it opened, bringing in shoppers and dollars from throughout the state.
General Growth’s other Iowa prize is Coral Ridge Mall in Coralville, a town neighboring Iowa City. Its third property, Mall of the Bluffs, in Council Bluffs, is 19 years old and decidedly smaller. Both properties are more modest than Jordan Creek.
“They wanted to build this mall and they wanted it to be the crown jewel of their developments,” said Kathy Dunbar, owner of Blue Willi’s by Kathy, an upscale men’s and women’s apparel shop at Jordan Creek. “Everything they put in writing, they do.”
Beyond what they put in writing, the friendliness of the Iowa family is still in their bones, and in their business. Dunbar was impressed when, on the day of the opening, Matthew Bucksbaum stopped by her store.
“That kind of thing usually doesn’t happen with a corporation that size,” Dunbar said.
While retail real estate investment trusts are young enough that many of the founding families still control the company — for example, David Simon runs Simon Property Group, the REIT founded by his father and uncles; Alfred Taubman’s sons, Robert and William, run Taubman Centers, and Stephen Lebovitz has stepped up as leader of his father Charles’ CBL & Associates — the Hawkeye State provides a uniquely provincial quality to the way the Bucksbaums run their business.
It isn’t as though General Growth hasn’t executed its share of takeovers, hostile or otherwise. They were one of the first REITs listed on the New York Stock Exchange in 1984; in 1989, acquired The Center Cos., and 10 years later, bought an interest in CenterMark Properties. Just a year later, in 1995, the company invested in the development arm of Sears, Roebuck and Co. and moved its headquarters to Chicago. Last year, right around the time Matthew and John were visiting Iowa for the opening of Jordan Creek, the REIT completed the $12.6 billion acquisition of Baltimore-based The Rouse Co., a major player in the now-explosive mixed-use development arena.
“I was actually very skeptical and reluctant about ever building another shopping center in Iowa,” laughed John Bucksbaum. “I couldn’t imagine that we would be successful by doing a new one, but lo and behold, the demand heated up and it worked.”
Bucksbaum will be the first to say that moving to Chicago was necessary to the growth of the company. “We knew that Des Moines, while it had been very good for us and while it had worked for the first generation of General Growth, wasn’t going to work any further. It was difficult at times to attract talent to Des Moines, transportation was an issue and so much of our business was spent in the financial centers. We knew that large investors tended to be in places other than Des Moines, Iowa,” he said.
But still, they weren’t going to abandon the Midwest entirely. New York City was “not especially appealing for various reasons and for various people as a place to locate,” so Chicago was the choice.
From Chicago, the family’s continuing retail influence in Iowa, hardly a shopping mecca, is profound.
“They were the catalyst to a lot of development in the area,” said Dunbar, of Blue Willi’s. In West Des Moines, several strip shopping centers along with other upscale retail developments such as West Glen Town Center have sprouted up since Jordan Creek opened. Coral Ridge had a similar effect. That mall, which opened seven years ago in an undeveloped area off Interstate Highway 80, spurred the development of a Wal-Mart Supercenter, Kohl’s, Lowe’s and other smaller shops and restaurants.
Aside from shopping centers, the Bucksbaum legacy in Iowa includes support for the arts and contributions to three colleges and universities. The Martin Bucksbaum Family Foundation, for example, contributed $1 million in 1996 to support a popular lecture series at Drake University in Des Moines.
“This is the biggest drawing lecture we have at Drake,” said Susan Breakenridge, administrator of the lecture series. Past speakers at the free lectures have included documentary film director and author Ken Burns, musician Wynton Marsalis, political commentator Tim Russert and author Salman Rushdie.
Martin Bucksbaum’s widow, Melva, and his daughter, Mary Bucksbaum Scanlan, have come to Iowa to attend some of the lectures, Breakenridge said.
Melva and her daughter also funded the acquisition of two sculptures worth $1.5 million for the Des Moines Art Center to be part of a river-walk project along the Des Moines River in Des Moines.
At the University of Iowa’s Henry B. Tippie College of Business, Matthew Bucksbaum has contributed to support a fellowship program at his alma mater.
Matthew Bucksbaum is “a person who likes to see success,” said Gary Fethke, dean of the business college. “He wants to see good things happen and will support and push for it.”
Other Bucksbaum influences include support for the Bucksbaum Center for the Arts at Grinnell College in Grinnell, Iowa, and the Bucksbaum Arts Wing at the Caspe Center, a Jewish cultural, social and sports center near Des Moines.
And, despite Matthew Bucksbaum’s move to Chicago, “he is still emotionally connected to Iowa,” Fethke said. “Iowa’s been important to [his] business.” Chicago also has been a beneficiary — Matthew and Kay recently donated $2 million to endow a fellowship at the University of Chicago.
What John, who became ceo of General Growth six years ago at the age of 43, will bring to Iowa specifically remains to be seen. Outside of Jordan Creek, it’s unlikely that General Growth will develop any more major projects in the state — “it’s solid but certainly not explosive growth, like the Sunbelt cities” — and for the past 25 years, his life has been spent in Chicago and other major metropolitan areas. The business, too, is changing. The scope of the mall itself is different, as are its caretakers. John, along with the likes of David Simon, Robert Taubman and Stephen Lebovitz, have new geographies and properties to conquer.
“When I was younger, I thought if I were to become ceo, my greatest responsibility would be to be a good caretaker of what was already created. My job would be to take care of it and not mess it up,” he said with a laugh. “But now we’re in the second generation of retail. The mall was invented for all practical purposes in the 1950s. And the business is changing so much, the second generation is completely remaking retail. So it’s been a wonderful opportunity to build upon the accomplishments and achievements of my father and uncle. I think the others whose families are in similar situations have the same opportunities and are executing the same options.”
Editor’s Note: This is the third in an occasional series of articles in which WWD visits markets “off the beaten path” of the regular retail and fashion haunts of New York, Chicago and Los Angeles. In this series, which takes readers on a journey across the U.S., WWD will see how peripheral markets evolve, what brands are in demand, how retailers merchandise their goods and what it takes to thrive in these markets. Today, “On the Road With WWD” stops in West Des Moines, Iowa, to check in on the Bucksbaums, founders of General Growth Properties, one of America’s pioneers in mall development.