The fairest of the mall
For mall owners, it could be the biggest shopping period of the year after Black Friday following Thanksgiving. For Danbury Fair Mall, it could help decide how lucrative future holiday seasons could be.
This week, John Kinsella sets up shop at the International Council of Shopping Centers”™ annual RECON retail real-estate conference in Las Vegas, with more than 50,000 visitors and 1,800 exhibitors expected through Wednesday.
A Syracuse, N.Y.-based leasing representative for mall owner Macerich Co., Kinsella will dangle an anchor-store “pad” that has remained vacant at Danbury Fair Mall since Macy”™s Inc. acquired Filene”™s, then shut down the Danbury store due to the presence of a Macy”™s among Danbury Fair Mall”™s four other anchor stores.
With the former Filene”™s space the first sight to greet northbound motorists on Route 7 from lower Fairfield County, Kinsella confirmed he has contacted Nordstrom Inc. about occupying what could be the mall”™s top-shelf space.
It is the first time Danbury Fair Mall has had the opportunity to release an anchor pad in the two decades since it opened.
Attracting Nordstrom ”“ or a fashion department-store competitor like a Bloomingdale”™s or Neiman Marcus Inc. ”“ could in turn serve as a launch pad to attract smaller luxury retailers in the mold of Tiffany & Co., as well as restaurants with more upscale fare than that offered by current tenants Ruby Tuesday”™s and Uno Chicago Grill.
In short, Macerich envisions a regional competitor to poach business from The Westchester, a glitzy mall 45 minutes distant in downtown White Plains, N.Y., that attracts customers from affluent towns in Fairfield County and neighboring Westchester, Putnam and Dutchess counties in New York. The Westchester is owned by Simon Property Group Inc., an Indianapolis real-estate investment trust (REIT) that also owns the Clinton Crossing Premium Outlets off Interstate 95 in Middlesex County.
“We don”™t want to fill that pad with just whoever would take it,” Kinsella said. “It”™s about taking that next step up ”“ really catering to a more affluent customer.”
In the past year, the mall has already taken steps in that direction, renovating the property to eliminate the feeling of a “cold industrial environment” in the words of Maura Ruby, the mall”™s senior property manager.
Ruby thinks the warm interiors will heat up lease activity for Santa Monica, Calif.-based Macerich, which obtained the keys to Danbury Fair Mall via its $2.3 billion acquisition in 2005 of Rochester, N.Y.-based Wilmorite Properties Inc. The developer opened the 1.3-million-square-foot mall in 1986 on the site of the former state fair grounds adjacent to Danbury”™s small airfield.
At an estimated property value of $447 million, Danbury Fair Mall is the second most expensive property in Macerich”™s portfolio after its fellow Wilmorite alumnus Freehold Raceway Mall in New Jersey which it valued at $528 million.
Macerich owns nearly 100 malls and shopping centers nationwide, which combined have 81 million square feet of space. The REIT delivered $72 million in income to investors last year, as revenue hit $896 million.
At last report, the company was carrying a $176 million mortgage on the property due in 2011, and its 4.6 percent mortgage on the property is the third most attractive in its entire holdings. Perhaps for that reason, Macerich also has pledged more equity in Danbury Fair Mall as collateral than any other property ”“ $13 million.
At the close of 2007, Danbury Fair Mall numbered among the handful of top performing Macerich malls across several key metrics, including leased space and sales per square foot of space.
With those kinds of numbers, it seems a safe bet Kinsella will generate attention at more than 40 meetings he has scheduled in Las Vegas this week. While he doesn”™t expect to come home with ink drying on a lease, he nevertheless expects big things scouting RECON for prospective tenants.
“A good day would be if we have a nice fashion department store make an oral commitment,” Kinsella said.