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Jordan Creek Redirects Competition
Patt Johnson
Des Moines Register
July 31, 2005
[Note: This material is copyright
by the Des Moines Register, and is reproduced here as a matter of
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Moines Register.]
The new competition from Jordan Creek Town Center, he thought, would certainly take a bite out business at his three metro area eateries - Skip's on Des Moines' south side, Nick's in West Des Moines and the Urban Grill in Urbandale.
Twelve months and thousands of entrees later, Bachman said he hasn't felt even a pinch from the new mall.
"I can't imagine why we haven't felt it," said Bachman.
He's one of the lucky ones. Since the $200 million, 200-acre shopping and entertainment complex opened Aug. 4, 2004, other metro businesses have faltered. Sales at three other area malls dropped off over the 2004 holiday shopping season while Jordan Creek flourished, according to state sales tax figures. Restaurants, especially, have suffered: Over the last nine months, taxable sales at eating and drinking establishments have fallen by 1 percent in Polk County while more than doubling in Dallas County, home of the new mall.
Competing merchants have been scrambling to regain their footing.
"Jordan Creek is really hurting us, especially on the weekends," said Bob McClelland, manager of Walker's Shoe Store in Valley West Mall. Jordan Creek's new offerings - including anchors Dillards and Scheels All Sports, and a variety of smaller retailers like Williams Sonoma, Pottery Barn, JJill, J.Crew, the Apple Store and others - have lured some customers away from Valley West, he said.
"There are too many retailers in direct competition right now," McClelland said.
Jordan Creek has drawn millions of people, mostly on the weekends, who come to shop, eat, watch movies, listen to concerts, walk the pedestrian trails, stay at the Residence Inn by Marriott and visit other mall properties. Traffic counts done by center officials show that nearly 16.9 million people have visited the mall since it opened. Center officials had projected first year traffic at 12 million.
Arlene Branchini of West Burlington made the 187-mile trek from her home to Jordan Creek Town Center for a shopping blitz with friends.
"We loved it," said Branchini. "We loved the restaurants, the stores and the wonderful customer service. Everything was crisp and clean."
While the mall was appealing, it won't deter Branchini and her friends from continuing to visit other favorite haunts: The Mall of America in Bloomington, Minn., and Country Club Plaza in Kansas City, Mo.
"Those are fun getaways for us girls," she said.
Gayle Terry, marketing director at Country Club Plaza, said Iowa is a huge draw for the popular Missouri shopping district.
"Of the top 10 ZIP codes merchants report sales from, Des Moines and West Des Moines are always in the top five," she said. Overall sales at the Plaza increased 6 percent in 2004 and are up 2 percent so far this year, indicating that Jordan Creek is not siphoning shoppers away, she said.
Drawing from the region
Jordan Creek officials had
promoted the mall as a regional draw that would keep retail dollars in
Iowa.
The new-to-Iowa stores and
restaurants at Jordan Creek "have kept some people from making out-of-state
trips," said Ken Stone, a retail economist from Ames, who was basing his
observation on sales tax receipts the state tracks.
Sales tax figures show that the complex is drawing in shoppers from other areas. Sales tax receipts from the last three months of 2004 - retail's critical holiday season - suggested that central Iowa's retail base is growing.
According to initial figures, taxable sales at area malls increased by $29.4 million, a 20.6 percent jump over the 2003 holiday season. But those figures missed some sales and will be revised upward, according to the state revenue department.
Sales per square foot at the hybrid center - a mix of indoor mall, outside strip centers, walkways and restaurant district surrounding a small lake - have exceeded expectations, say center developer General Growth Properties Inc. The Chicago-based company is the second-largest mall owner and operator in the country.
' Beyond our expectations'
"The center's performance has been tremendous and well beyond our expectations in the first year," said John Bucksbaum, General Growth chief executive and Des Moines native. He declined to give specific sales numbers but said the number of Jordan Creek retailers and restaurants that are new to Iowa have been a great calling card for the center.
Retailer Kathy Dunbar said sales at her Jordan Creek clothing boutique, Blue Willi's by Kathy, have met first-year goals, although she would like to see the cash register ringing more often.
"Jordan Creek is definitely a weekend mall," said Dunbar. "There are days when there are tons of people in the mall" and other times when shoppers are sparse, she said.
Dunbar said several vacant storefronts on her end of the mall have contributed to the lack of traffic there.
Jordan Creek Town Center, located in Dallas County, has made a big difference in the county's sales figures. For the nine months ending in March, taxable sales totaled: • Dallas County: $455.2 million, a 78 percent increase over the same period a year ago. • Polk County: $4.67 billion, a 1 percent increase. For sales at eating and drinking establishments during the nine months ending in March: • Dallas County: $41.1 million, up $23.53 million or more than double the same period a year ago. • Polk County: $400.95 million, down $4.59 million, or 1 percent. - Iowa Department of Revenue |
"I would like for my store to be doing better," Dunbar said. "But I can see it will happen."
Mall is almost full
Mall occupancy has been hovering just below 90 percent but should be closer to full by the holiday sales season, mall officials predict.
The frenetic first days of the mallwhen shoppers flocked to eat at the restaurants and check out the shops, have eased.
Sales have been softer and more inconsistent than anticipated at the Wine Experience restaurant and wine store in the Jordan Creek Younkers, said Tom Henry, the shop's co-owner.
"There's a big difference
between a $3,000 day and a $300 day, and that's the kind of difference
we're seeing," he said. The Wine Experience sells wine and accessories,
but its main business is lunches, dinners and wine by the glass, he said.
The mall was constructed
with the expectation that surrounding residential and commercial development,
like the Wells Fargo project nearby, would support the massive center.
"It was built based on what was to come, not what was here," Henry said. There could be a two-year lag before nearby housing and businesses are able to help sustain Jordan Creek, he predicted.
If some mall merchants are disappointed in less than stellar sales, some competing businesses in neighboring communities are feeling a deeper slice.
To survive, Devin Rowling has trimmed staff, revised his menu and expanded hours to include lunch seven days a week at his Cosi Cucina restaurant in Clive.
After the mall and five new restaurants opened there last August, Rowling said sales plummeted 20 to 30 percent. He was losing $2,000 to $3,000 a week. He had to cut costs and secure bank loans.
"Sales didn't start coming back until May," he said. "Now we're back to within 5 to 10 percent of what we had been doing. We've definitely become a leaner and stronger business."
In the 12 years he's operated the Italian cuisine eatery, Rowling said he's faced stiff competition before and "survived them all."
Merle Hay Mall saw a drop in sales after Jordan Creek opened but sales have rebounded this spring, mall officials said. The Silver Cinema did not rebound, closing 10 weeks after Jordan Creek's Century Theatres opened. Merle Hay also has some renovations planned and recently opened a new anchor store, Target.
Sales at Valley West Mall are down due to Jordan Creek, said Steve Watson. His company, Watson Centers in Minneapolis, owns the West Des Moines mall.
"There's a larger amount of retail, and the market hasn't grown," he said.
His best defense: "Get the right tenants." Watson said he continues to talk with local and national retailers he believes would be a good fit for Valley West.
Watson said he expects the full impact of Jordan Creek to be evident sometime next year, when its novelty wears off.
Coming and going
Stores that were not announced but have opened since the center's debut: Avon
Stores scheduled to open: Eb Games
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Stores that either decided
not to come or closed:
California Pizza Kitchen
restaurant
Still in discussions as a possible fourth anchor: Nordstrom department store Yet to be leased: Several storefronts in the
mall, about 10 percent of total leasable space.
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