The Journal Gazette
 
 
Sunday, September 09, 2018 1:00 am

Challenges awaiting Glenbrook's owner

Toronto company gets mall as 2 anchors preparing to depart

SHERRY SLATER | The Journal Gazette

Glenbrook Square is entering perhaps the most pivotal point in its 52-year history.

By the end of this year, two of the 1.2 million-square-foot mall's four anchor stores will have closed. Sears and Carson's will jointly leave a few hundred thousand square feet vacant in their wake.

Anchors are considered critical for attracting shoppers, who often continue into a mall's interior to shop at lesser-known retailers that wouldn't attract as much traffic on their own and could possibly founder.

Although Glenbrook still boasts Macy's and J.C. Penney in anchor positions, those retailers have left their own trails of closed stores nationwide as they struggle to adapt to a retail landscape upended by online retail giant Amazon.

The challenge of positioning Glenbrook to thrive in the evolving retail environment falls on a new owner. Toronto-based Brookfield Asset Management late last month acquired Glenbrook parent company GGP for about $15 billion.

Brian Kingston, Brookfield Property Partners' CEO, explained to Bloomberg why the privately held company waded into the raging retail waters.

“We look for places where people are running away from,” he said last month. “Ultimately, we're value investors. So that means many times it leads you to being contrarian.”

Within the interior hallway connecting Sears and Carson's sits The Jewelry Box, a kiosk that sells necklaces, watches and rings. Sam, who goes by one name, has worked there for a year and a half.

If customer traffic at Glenbrook slows and sales dry up, Sam said Friday, he expects to lose his job.

Rays of hope

It's not all bad news for Glenbrook.

Construction is underway for a new tenant that's guaranteed to be a major draw: P.F. Chang's. The upscale Chinese restaurant, which is expected to open this fall, has been among the most requested entries into the local market.

As of last week, construction crews were hard at work on the space near Barnes & Noble. A sign posted outside said hiring for the restaurant has begun.

With consumer confidence in August at its highest since October 2000, some shoppers are more willing to splurge on a nice dinner, a new purse or replace a sputtering dishwasher.

The retail industry contributes $2.6 trillion to the nation's annual gross domestic product, making it a daily barometer for the U.S. economy, according to the National Retail Federation, a trade association in Washington.

Some retailers are reporting stronger sales. Those on the upswing range from Tiffany & Co. on the higher end to Dollar General on the lower. Nordstrom, Target, Kohl's, Home Depot and Walmart are also prospering.

Unfortunately, none of those retailers are found inside Glenbrook, although Target, Kohl's and Walmart have stores less than a mile away. But mall tenants could expect to see increased spending by their loyal customers.

It might be a long shot, but there's a chance one of Glenbrook's empty anchors could be revived. USA Today last week reported that some stores previously owned by Bon-Ton, the parent company of Carson's, might reopen with a new owner. 

A subsidiary of the Merrillville tech company CSC Generation Holdings said it has agreed to buy the rights to Bon-Ton and its subsidiary department store chains. A Delaware Bankruptcy Court would need to approve the deal.

CSC would focus on online sales but officials said they also have entered “advanced discussions with landlords about reopening stores in Colorado, Illinois, Indiana, Wisconsin and Pennsylvania,” USA Today reported.

Bon-Ton announced more than 200 store closings when it filed for bankruptcy protection in February. The list included 10 Indiana stores.

Anchors to stay?

Macy's and Penney, which have closed dozens of stores in other malls in recent years, seem confident about their Fort Wayne locations.

“We do not comment on single store performance, but I can tell you that we currently have no plans to close our location at Glenbrook Square,” J.C. Penney spokesman Joey Thomas said in an email.

Early on Friday afternoon, customer traffic was brisk in Penney, as it was throughout the mall, where people of all ages were spending the drizzly afternoon. Mall walkers paced past moms watching their young children play and husbands waiting while their wives shopped.

Inside Macy's was a different story. There was almost a hush inside the three-story department store, where it was possible to stand in the middle of the main floor, turn around in a complete circle and see only three customers among the racks of party dresses, displays of upscale cosmetics and racks of designer shoes.

Andrea Schwartz, Macy's spokeswoman, said the local Macy's store draws customers from a 100-mile radius.

“As a result, we serve a diverse group of customers and curate our assortment to meet their needs,” she wrote in an email. “And, sometimes, we provide the unexpected.”

As an example, she said, the store has started selling DeBrand Fine Chocolates, which are made in Fort Wayne.

“It's all about the people and providing the service and assortment to be the fashion destination for our customers,” Schwartz wrote.

More people were shopping in Sears on Friday than Macy's, but the atmosphere was completely different. Merchandise displays were messy and shelves of goods were obviously picked over.

At one cash register, seven sullen shoppers waited in line behind the eighth, who was paying for her purchases. No one smiled or even made small talk.

Large signs advertised everything 10 percent to 30 percent off, and nearby signs said the retailer is hiring for the clearance sale.

Chelsy Hart was at Glenbrook on Friday with her 3-year-old, 5-week-old and her mom. The Garrett mother of two comes about once a month to the mall, where she buys her kids' clothes at Crazy 8.

Hart is also waiting for the discounts to go deeper at Sears.

“We need a new fridge,” she said.

A second life

Mall operators have long looked for ways of attracting shoppers by mingling entertainment options with retail stores. Local efforts date back to the 1980s when video arcades filled otherwise forgotten spaces and an ice rink opened in 1981.

The mall's owners can't afford to let shoppers get bored, so they seek a revolving lineup of attractions. Almost a decade after removing the skating rink, Glenbrook installed a $500,000, two-story carousel in 2006 in the food court

That was the draw for Shaleah Langner's daughter, who turned 8 on Friday.

“She wanted to come to the mall and go on the carousel for her birthday,” the Harlan mother of six said. Langner was sitting in a children's play area, watching her daughter and son, who turns 2 next month.

“When we first moved to Fort Wayne, someone told us about the carousel. Even my mom, when she visited from Minnesota, wanted to ride the carousel,” she added.

These days, the mall's lower level hosts a monthly artisan's and collectibles market on the third Sunday of each month. Items for sale include jewelry, clothing, health and beauty items, gaming, sports cards and comics.

But some mall owners have strayed far beyond the typical options for filling vacant spaces.

In some markets, large, empty stores have been converted into movie theaters, hotels and gyms. Other malls have subdivided the spaces and leased the smaller parcels to smaller retailers.

Dallas-based Common Desk transforms empty retail space in shopping centers into co-working office spaces, where contract employees and small-business owners can lease a desk when needed.

These alternative uses not only transform vacancies into occupied spaces, but they can also attract people who might not normally go to a mall. Landlords – and tenants – hope visitors will do a little shopping before they leave.

In some cases, mall owners abandon the retail marketplace completely. 

Brookfield, Glenbrook's new owner, leveled a former Rouse Properties mall near San Francisco to build apartments in an area where housing is scarce.

About an hour south of Indianapolis, Columbus city officials plan to buy a 28-year-old mall and convert it into a community recreation center and sports tourism complex. The 400,000-square-foot FairOaks Mall sits on 35 acres. The negotiated sale price is $5.9 million.

But it's unlikely Glenbrook would face such a fate any time soon.

Langner's family moved to Harlan from a small Minnesota mining town three years ago for her husband's job with Steel Dynamics Inc. She has been pleased with the retail options available here, especially at Glenbrook.

“In our hometown, the mall is almost completely empty,” she said. “So coming here, it's like, wow. Even with those two big stores closing.”

sslater@jg.net


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