Federated sends a Stern message by closing all stores
Federated Department Stores Inc. of Cincinnati has decided to close its Stern's stores in New York and New Jersey after 134 years, converting 19 of 24 locations to Bloomingdale's and Macy's. Federated will close the remaining five stores, as well as the company's Paramus, N.J. headquarters. With the move, Federated plans to significantly increase Macy's and Bloomingdale's presence in the New York and New Jersey market.
“This can only be a positive because of the retail demographics in that area,” said Faith Hope Consolo, vice-chairman of New York-based Garrick-Aug Associates Store Leasing Inc. “Stern's was a great operator, but the company was not as popular as the big-box retailers.”
The following locations are expected to be closed and then sold: Sunrise Mall, Massapequa, N.Y.; Smith Haven Mall, Lake Grove, N.Y.; Roosevelt Field, Garden City, N.Y.; stores in Monmouth, N.J. and Valley Stream, N.Y. Last September, Stern's also announced closings at its 33rd Street store in New York City and at the Nanuet Mall store in Rockland County, N.Y.
Also, Stern's stores in Toms River, N.J.; Atlantic Terminal, Brooklyn, N.Y.; and South Shore Mall, Bay Shore, N.Y., will convert to Macy's, but are under evaluation for closure.
Saks decides not to split up; May to buy nine Saks stores
As a result of stronger than expected fourth-quarter sales in the company's department store group and weaker than expected sales at its Saks Fifth Avenue division, Birmingham, Ala.-based Saks Inc. has canceled a proposed split of the company.
The retail company attributed the decision to a change in market valuations of department stores and luxury goods retailers in recent months. The groups were to be split into two separate companies, according to a plan Saks Inc. unveiled last July 2001. The idea was to separate the company's strongest assets — Saks Fifth Avenue, Saks Off 5th and Saks Direct — from its weaker department store group.
Saks also announced that George L. Jones has been named CEO of its department store group and that Christina Johnson will serve as president and CEO of the Saks Fifth Avenue Enterprises division.
In related Saks news, St. Louis-based The May Department Stores Co. will buy nine department stores for an estimated $310 million from Saks. The stores include five Proffitt's units in Nashville, Tenn., three Parisian locations (one in Baton Rouge and Lafayette, La., and another in Orlando, Fla.) and a McRae's in Baton Rouge. The transactions are expected to close in the first quarter of 2001.
“Our decision to not split the company will have no impact on the May Co. transaction,” said Julia Bentley, a Saks spokeswoman.
The Hecht's division of the May Co. will operate the stores in Nashville — Galleria at Cool Springs, The Mall at Green Hills, Bellevue Center, Hickory Hollow Mall and Rivergate Mall — while the Foley's division will operate the Baton Rouge stores, which are in the Mall of Louisiana, Cortana Mall and Acadiana Mall. The Orlando store, which is in The Florida Mall, will be converted to a Lord & Taylor.
CBL pays $1.3 billion for nearly 20 million sq. ft. of retail space
Chattanooga, Tenn.-based CBL & Associates Properties Inc. has purchased Cleveland-based The Richard E. Jacobs Group's interests in 21 malls and two associated centers for approximately $1.3 billion.
The properties, which total approximately 19.2 million sq. ft., include five malls in Wisconsin, three each in North Carolina, Kentucky and South Carolina, two in Michigan and Ohio, and one in Illinois, Tennessee and Texas, as well as the associated centers in both Ohio and Wisconsin.
The purchase price consists of $124.8 million in cash, which includes closing costs of almost $12 million; $771.3 million in non-recourse mortgage debt; and the issuance of 12.5 million unit shares of CBL's operating partnership with a value of $32.25 per unit. The cash portion was funded from a new $212 million unsecured credit facility provided by Wells Fargo.
Two-for-one retail special at Tampa International Airport
Construction is under way on two retail projects that will be located on the southeast edge of the Tampa International Airport in Tampa Bay, Fla. International Plaza, a 1.26 million sq. ft., enclosed shopping center, and Bay Street at the Plaza, an adjacent 112,000 sq. ft., outdoor lifestyle/dining center, are scheduled to open in September 2001. Both projects are under development by Bloomfield Hills, Mich.-based The Taubman Co.
International Plaza will offer retail shops on two enclosed levels and feature more than 200 specialty retailers. Anchors will include Nordstrom, Lord & Taylor, Dillard's and Neiman Marcus. Adjoining the development will be an outdoor entertainment area anchored by a five-star hotel.
The outdoor Bay Street at the Plaza will be reminiscent of a vibrant Caribbean village square, featuring outdoor cafés and fountains, as well as local and regional specialty shops.
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Retail center planned along the banks of the Ohio River
Entertainment center Newport on the Levee is under construction along the Ohio River, overlooking the Cincinnati skyline. The $136 million project, a development of Columbus, Ohio-based Steiner + Associates Inc., will complement the $40 million Newport Aquarium. The project is scheduled for completion by October 2001.
Other components of Newport on the Levee will include a 20-screen AMC multiplex, an IMAX Theatre, 85,000 sq. ft. of restaurants, 170,000 sq. ft. of entertainment, 20,000 sq. ft. of retail, 200,000 sq. ft. of Class-A office space and a 213-room Hilton Garden Inn hotel.