A MAKEOVER NOW IN PROGRESS at Wonderland Mall in Livonia, Mich., is less a new project than the continuation of a process of change that has been ongoing since Schostak Brothers & Co. Inc. bought the property in 1983.
Originally opened in 1959, the Montgomery Ward-anchored Wonderland Mall was considerably outdated at the time of purchase. At only 600,000 sq. ft., it was small by '80s standards, and unlike most other Snowbelt malls, it was not enclosed, consisting instead of four entirely separate, open-air segments.
Metamorphosis Schostak quickly set about to bring it into the contemporary world. The Southfield, Mich.-based developer hired architects Wah Yee Associates of Farmington Hills, Mich., to come up with a plan to unify and enclose the four segments. The transformation, which was completed in 1985, had the added benefit of creating 100,000 sq. ft. of new GLA from the spaces between the original segments.
In 1989, the company added Target and a six-screen AMC Theatre, and in the early '90s, it brought in Service Merchandise, OfficeMax and Dunham's Sporting Goods for additional anchor spots. By that point, the center had grown to about 80 tenants and 862,000 sq. ft.
In late '97, the company initiated a new round of changes designed to "position Wonderland at the forefront of 21st century retail," says company co-president and COO Robert I. Schostak. Part cosmetic and part compositional, the changes include the $10 million conversion of a full wing into a 150,000 sq. ft. food and entertainment center, addition of new anchors and sub-anchors, relocation and expansion of many existing tenants, and a new focus on family apparel.
New tenants include Burlington Coat Factory, Old Navy and Bath & Body Works. Existing tenants undertaking expansions include Leather City and Foot Locker, which will open one of its first larger-format stores.
Solid demographics On the surface, Wonderland Mall would not seem to have needed a substantial makeover to maintain profitability. The dominant shopping center in its trade area, it has always done well and, according to Schostak, the demographics have changed little in the past 17 years. The area still offers "a lot of young families, great density and good income," he says. Furthermore, it is unlikely to face significant new competition because the area is effectively built out.
So why renovate? As Schostak puts it, "We saw an opportunity to reposition the mall to capture a greater part of the market and boost sales."
The company hired afirm to conduct a survey of mall visitors and a telephone survey of randomly chosen area residents. The researchrevealed that people wanted a greater number of value-priced family and fashion apparel stores, more fashionable retailers, a cheerier environment and, above all, a greater range and number of entertainment choices, especially for families to enjoy together.
Tothe renovation, Schostak Brothers once again turned to Wah Yee. Rather than add square footage, the company and designers opted to reorganize the existing GLA by moving tenants from one wing and replacing them with entertainment users. The food court, already located in the wing, was completely redesigned and the wing was spruced up with new flooring, lighting and paint. Most tenants forced out of the wing were accommodated elsewhere in the mall, but a few left.
A new look The renovated wing has two major entertainment tenants: Jeepers!, a Waltham, Mass.-based operator of child-oriented indoor amusement parks; and FYE, a Rochester, N.Y.-based book, video and music retailer also known as Record Town, Inc.
The wing's most notable component is an expanded and redesigned food court that has been master-leased to Ogden Entertainment, a division of New York-based Ogden Corp. At 35,000 sq. ft., the revamped area is 40% larger than before. Both the new and recovered space has been used to increase the seating capacity from about 325 seats to 535 and create a less cramped feeling. The smaller vendors that formerly tenanted the court have been replaced bycompanies such as Barney's Coffee, Burger King, Sbarro, Steak Escape, Manchu Wok and Chili Peppers, a Mexican restaurant chain developed and owned by Ogden itself.
According to senior project designer Matt Niles, Wah Yee conceived the food court as a kind of indoor park. The design focuses on the ceiling, which has been painted dark blue, tapering to white at the edges and ringed by neon stripes and red and orange bands. Clusters of twinkling lights hang down. For furnishings, Wah Yee selected freestanding metal tables and chairs in four colors for a rainbow effect.
Judging from retailer response, Wonderland Mall's renovation is clearly on the right track, according to Schostak. "We've been marketing the new Wonderland to the retail community for about 18 months, and we've had a surprisingly strong response," he says. "We thought things would materialize at a given pace. In reality, things have moved quicker."
Schostak says the overall goal is to increase sales 15% to 20% in the next two years. If early customer response is any indication, he adds, Wonderland Mall may easily exceed that mark. He says business at existing stores has already picked up and new stores are doing well. About 100,000visit the mall weekly, and the number is steadily increasing.
According to Schostak, FYE, which opened in November 1997, has "boldly exceeded" projections and Record Town plans to use its success with FYE as a model for national expansion. Nabil El-Hage, chairman and CEO of Jeepers!, says the Wonderland facility has already become one of the company's top-performing locations.
"I'd like to think we're on the leading edge of the curve," Schostak says. "Retailing is a rapidly changing environment, and we're responding aggressively to what malls of the late '90s and beyond need to look like."
* Location: Livonia, Mich.
* Owner: Schostak Brothers, Southfield, Mich.
* Opening: August 1959
* Trade area population: 961,000
* Average household income: $49,000
* Current GLA: 852,000 sq. ft.
* Number of stores: 80
* Current anchors: Wards, Target and Service Merchandise
* Original anchors: Wards, Federal's
* Fun fact: The Wards at Wonderland Mall will be redeveloped as a prototype store for the venerable retailer. It will be the first Wards prototype store in Michigan.