Retailers find opportunities in a desert oasis outside of the Las Vegas limelight.
SUMMERLIN, Nev. — Summerlin looks, at first glance, like a poor man’s South Florida. It’s all sun-scorched highways, low-rise residential developments as far as the eye can see — at least until the desert meets the mountains — and baby palm trees, planted alongside the cranes putting up the next development.
But this Las Vegas suburb is a gem of retail opportunity.
Although Summerlin, which started out as a 22,000-acre development by the eccentric billionaire Howard Hughes, is only 20 minutes from the glittering neon of the strip and its multimillion-dollar hotels and casinos, it couldn’t be any more different, especially in a retail context. That soon may change.
Despite the booming population — according to local real estate executives, roughly 29,000 new homes were sold in 2003 and 2004, and 31,000 are expected to be sold by yearend, while the value of homes has jumped 40 percent in just a year’s time — retail is currently limited to a few chain stores and restaurant options are only as high-end as PF Chang’s and Chili’s.
“The suburbs are a kind of vacuum for better and upper retail and dining,” said Frank Volk, executive vice president of Robert K. Futterman & Associates, a New York-based specialty retail brokerage firm that recently opened an outpost in Las Vegas. “There are a few vignettes of retail, but the total square footage of retail in Summerlin is maybe 500,000 square feet.”
Some luxury fashion retailers, including Louis Vuitton and Tiffany, have ventured off the strip to explore their options in the Vegas suburbs, but no significant real estate deals have been made as of yet. Other high-end retailers are less risk-averse. Whole Foods and Pottery Barn both have popular stores in the area, and Whole Foods is slated to open another store in Summerlin soon.
One obstacle to setting up shop in Summerlin is that many of these national chains have to break their own rules in order to take advantage of the booming growth in regions here or in other high-growth areas elsewhere in the Sunbelt.
“We deal with a lot of retailers that have requirements as far as college education levels, household salary and other demographics that don’t match the profiles of residents in Vegas,” said Volk. “But retailers are starting to take account of the fact that our blue-collar workforce, most of which works in the gaming industry, have income levels near or above the standard white-collar level. A valet parker and a cocktail waitress working in the gaming industry can have a joint household income of $200,000 a year.”
With the dispensable cash and the lack of shopping options in the ‘burbs, most Vegas women spend their money in Los Angeles or San Diego rather than deal with tourists on the strip.
Locals understand this, of course. And for all of the national retail chains reluctant to invest in towns such as Summerlin, there are local fashionistas opening stores and capturing customers — and, interestingly, helping build the communities in these fledgling towns.
Kristi Hastings, boutique owner in Summerlin, is the founder of Savvi, a trendy apparel store, and co-owner of Sassi, an accessories shop. The two shops sit not more than 100 feet from each other in a small strip mall, just outside of new office construction and across from a housing development. A 10-year veteran of Las Vegas, Hastings opened Savvi two years ago. She met her current business partner, Ann Sachs, while Sachs was shopping in her store. This past spring, they opened Sassi.
“There aren’t many chain stores here, so we differentiate ourselves from other boutiques by being more fun, more casual,” said Hastings. “But even among the boutiques, we all try to help each other out.”
The close relationship the shop owners have with each other extends to their customers. On a visit to the store, Hastings was calling distributors for individual clients, and knew the shoppers names — and sizes. She’ll also let customers browse in either of the stores without any employee supervision, which brings to light the small-town trust, even among pricy merchandise.
Though she kept mum on sales at Sassi, Hastings typically brings in between $40,000 and $60,000 a month in sales at Savvi, where she sells anything from $125 ribbed tanks from Allen B. to $162 Red Engine distressed denim. Other labels, all at similar price points, include Hale Bob, David Kahn, Michael Stars and RocKandy, for which she is the exclusive carrier in the Vegas area.
In the accessories shop, which is still trying to find its niche, the two carry Gussto Bags, which run upward of $700, studded leather belts for $200 and candles embossed with vintage labels and Swarovski crystals for $120.
But the most appealing aspect of these shops, outside of the gems and premium denim, are the social activities they offer. The women that shop there all know each other by name, and soon their men will, too: In December, Hastings and Sachs are hosting a shopping party in conjunction with the Make-a-Wish Foundation. Women can send their husbands and boyfriends with “wish lists” to either of the shops, where the men will be entertained by models in lingerie, cocktails and music. Twenty percent of any shopping they do will go toward the Make-a-Wish Foundation.
“We’re doing all kinds of new things with the store. The boutique is still changing,” said Hastings.
As is the neighborhood, as a whole. General Growth, which owns the glitzy Fashion Show on Las Vegas Boulevard, in addition to the Canal Shops and the retail in the upcoming Palazzo, controls the remaining 7,000 acres of undeveloped land in Summerlin, and has plans for more retail — the Summerlin Town Center is expected to be no less than 1 million square feet.
“We need to take into account what’s at our other retail centers in Vegas, and see what’s appropriate to Summerlin,” said General Growth chief executive officer John Bucksbaum. “I think you’ll see there will be retailers in the Fashion Show who are also retailers in Summerlin.”
Editor’s Note: This is the fourth 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 Summerlin, Nev.