Saks becomes belle of this Benderson ball
John Hielscher / Sarasota Herald-Tribune
UNIVERSITY PARK – When the Mall at University Town Center was first envisioned in the boom year of 2005, Saks Fifth Avenue was not even considered for one of the anchor spots.
Instead, the tony retailer was passed over in favor of other upscale department stores like Neiman Marcus and Nordstrom.
But now Saks has become — as one competing developer puts it — the “queen of the prom.”
Saks is now the pre-eminent name at the long-awaited center, joining Macy’s and Dillard’s as anchors at a $315 million project that’s slated to open in fall 2014.
It was the first name mentioned in an April 24 press release by Taubman Centers Inc., Benderson’s new partner in the 880,000-square-foot mall.
“Saks, the ugly red-headed stepchild, is now the prom queen four years later,” said Chuck Madden, a commercial developer involved in stalled efforts to develop the former Sarasota Quay property downtown.
There are multiple reasons why Saks was initially left out, involving the perception of the retailer at the time and its competitors’ expansion plans.
In 2005, Neiman Marcus and Nordstrom were in expansion mode, eager to open new outlets in wealthy areas like Sarasota.
“Saks had lost some panache, although they have since turned the business around pretty well,” said retail consultant Jeff Green. “And there was the assumption that if Nordstrom was going in, why do you need Saks?”
Seven years later, Saks is now University Town Center’s star partly because of the Great Recession, which shelved University Town Center for a number of years and also quashed Neiman and Nordstrom’s appetite to open new stores.
The growing acceptance of online retailing also has prompted the two chains to rethink typical mall stores.
Saks’ desire to expand was another major factor. Its 40,000-square-foot store at Westfield Corp.’s Southgate Mall — though it has huge sales per square foot, a key industry bellwether — is roughly half the size of a typical Saks’ store.
At University Town Center, Saks will occupy an 80,000-square-foot store, still less than half the size of the planned Macy’s and Dillard’s stores.
“Our goal was to double the size so we could offer our clients there the breadth of assortment which we are not able to do in the same location,” said Kathleen Ruiz, a Saks vice president in New York.
Westfield has more than once filed plans to expand the 60-store Southgate — in 2007, it proposed a $120 million expansion that would have added a second floor and as much as 270,000 square feet to the mall — but the recession derailed the expansion.
Saks considered both the Quay property and the 18-story Proscenium development, proposed for a seven-acre tract of land at U.S. 41 and Fourth Street.
“When we got the Quay under contract, Saks reached out to us,” Madden said. “We had the demographics the retailers want, which is on the water. They were intrigued by whether we could do the best deal for them.”
But the Quay site became mired in the meltdown of lender Anglo Irish Bank. Eventually, it became part of the Irish government’s National Asset Management Agency, which oversees billions of dollars of distressed assets from the Irish property bubble.
Proscenium died when its supposed financiers were unable to provide the capital they claimed they had access to. Lenders balked at the project’s $1 billion pricetag.
Eventually, Saks’ lack of other opportunities and Benderson’s and Taubman’s need for upscale anchors aligned.
Neither side now seems very willing to discuss the past.
Saks did not respond to questions regarding the details of its planned 2014 move.
John Eggert, a Taubman development developer, acknowledges that Saks was left off the original store roster. But he noted that The Forbes Cos. — another Michigan-based upscale mall developer that Taubman and Benderson had previously partnered with on University Town Center — was handling the tenant negotiations at the time. Forbes did not respond to a call for comment.
Taubman, Eggert noted, has had a long relationship with Saks, which operates stores in five of the developer’s malls, including the Waterside Shops in Naples.
For its part, Benderson is focusing on the slate of anchors its 115-store mall will have, not on department stores of days gone by.
“We think Saks is one of the pre-eminent luxury department stores in the country,” said Mark Chait, Benderson’s executive director of leasing for the Southeast. “They will bring luxury fashion to the mall that will help attract other fashion retailers.”