Polaris’ developer aims to be current
Luring shoppers away from their laptops is the challenge of the day for bricks-and-mortar retailers. Michael Glimcher, chairman and CEO of Glimcher Realty Trust, says that attracting shoppers to the company’s Polaris Fashion Place is part art and part science.
“We spend a lot of time thinking about and programming the experience,” Glimcher says. “If you evolve and you put capital in, if you change the tenants and you’re current, you’re going to be around.”
Glimcher’s trademarked Experience Retail development, leasing and acquisition strategy is built around maintaining a competitive edge in the face of online shopping and mobile commerce.
Glimcher says the mall his father, company founder Herb Glimcher, fought to build in the 1990s has never been healthier. He attributes Polaris’ ongoing success to the mall’s evolution since opening in October 2001. Among the mall’s capital improvements are the $50 million, 155,000-square-foot outdoor wing, added in 2008, and a renovated main entrance and valet station.
“You have a vision in the beginning, and then the vision evolves depending on where the market goes,” he says. Polaris’ current tenants are a mix of stalwart department stores and smaller, high-end retailers.
As the company celebrates the success of Polaris and the other open-air-hybrid malls in its portfolio, Glimcher-owned Eastland Mall will hit the auction block in early June. Glimcher bought Eastland — one of Columbus’ premier enclosed shopping destinations when it opened in 1968 — for $29.7 million in 2003. The minimum bid for the property is $9 million.
Glimcher talked about the Eastland auction, Polaris and retail’s omnichannel future for Columbus CEO’s June feature, “Retail E-volution.”
Q: How did your father’s vision for Polaris change shopping in central Ohio?
A: His view was really the idea of bringing new anchor stores to the market. At the time, Lord & Taylor was new to the market, Kaufmann’s was new to the market, Saks was new to the market.
It was the first time in the country that a mall opened with seven anchor stores. … There hadn’t been new anchors come into the market in a long, long time. We were going to divulge something that was so large and powerful and unique that it would really draw the entire Columbus market.
Q: How does the health of large anchor retailers determine the health of your properties?
A: From a rent standpoint, generally the department stores either own their space or they pay a much lower rent. So economically, their ups and downs don’t affect us as much. It really has to do with how much traffic they draw to the mall.
Q: How has Glimcher insulated itself from the bankruptcies and mergers of large chain retailers?
A: We have a little bit of exposure to a lot of different retailers. That’s how we manage our portfolio. If you think of owning a mutual fund, you’re not going to have 50 percent of your money in one stock — you’re going to have a variety of different stocks.
We like doing business and having a lot of breadth and depth of the stores we deal with. We don’t want to be overexposed to anyone because you just don’t know, and retail is cyclical.
Q: What are your goals for Glimcher malls moving forward?
A: Our goal is for everything to perform as nicely as Polaris does. Polaris is over $500 a square foot. When you talk about A-properties, if you’re over $500, you’re a winner, you’re a top-performing property nationally. Our goal is to really get the entire portfolio to perform at over $500 a square foot in sales.
Q: What happens to Eastland Mall if it’s not sold by the end of Glimcher’s joint marketing period with trustee US Bank National Association in June?
A: If for some reason it doesn’t sell, a third-party manager will come in and operate it. For the customer, I don’t think anything will really change. Q: Why sell? A: It’s really just an issue of leverage. The asset was overleveraged, meaning there was more debt on it than there is value. We had a discussion with the lender, and they came to an agreement to market it.
Q: What’s your response to predictions of the shopping mall’s demise?
A: It was even on the cover of Time magazine, probably a decade ago, that the mall is dead. All I can tell you is, in our portfolio and really for the industry, occupancy is at an all-time high. Sales are at an all-time high. Rents are at an all-time high, and people are showing up. I don’t agree with what they’re saying; I never have.