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Monday, Jun 17, 2024

Fashion Square

By SHELLY GARCIA Staff Reporter At first, the closure of the Sherman Oaks Galleria seemed like good news for Fashion Square, another shopping mall just a few miles to the east. But lately, retailers and mall management have noticed a disturbing side effect. “We had people in here a couple weeks ago, and they said, ‘We thought the mall was closing,’ ” said Barbara Rock, the manager at Osim Global Health Care. “Obviously, they didn’t know the difference.” The closure of the Galleria several months ago for renovations has driven home a problem that has long plagued Fashion Square. While sales have increased steadily since the current owners, ERE Yarmouth Retail Inc., acquired the center about three years ago, some shoppers still don’t know it exists. “A lot of people in our focus groups called us a well-kept secret,” said Alison DiLeva, director of marketing for Fashion Square. Fashion Square, a much smaller mall than the Galleria, has long lived in the shadow of its Sherman Oaks neighbor, which became something of a cultural icon symbolizing the spending frenzy of the 1980s and the “Valley Girl” phenomenon. Things only got worse in the mid-1990s when Fashion Square lost its two longtime anchors, The Broadway and Bullock’s. Though Bullock’s was quickly replaced by Macy’s, the second anchor position remained vacant for nearly a year before Bloomingdale’s came into the shopping center nearly three years ago. Bloomingdale’s by itself has not been enough to boost customer recognition. For one thing, the location of the mall, in a residential community of Sherman Oaks, makes it hard to advertise its presence. To appease local residents, the mall was erected without big display windows facing the street, and signage has been kept to a minimum. “We think part of the confusion is, you can’t see us,” DiLeva said. “So that’s been a challenge.” Then too, the tiny mall (only 350,000 square feet, excluding the anchors) has no movie theaters to draw traffic, and its advertising budget is limited. To combat those drawbacks, Fashion Square has targeted programs to boost the spending of the shoppers who already go to the mall while trying to attract fresh retailers that will bring in new shoppers. So far, the strategy seems to be paying off. Comparable-store sales increased by 8 percent in 1998, and sales per square foot have been rising steadily. In 1998, sales per square foot increased to $362 a square foot, from $325 a square foot in 1997 and $306 a square foot in 1996. That compares with an industry average of $301 a square foot in 1998, according to the International Council of Shopping Centers, an industry trade group. But some say that, given the demographics and the lack of competition in the immediate area, Fashion Square should be doing a lot better. “I would say it’s poor, mediocre at best,” said Sanford Goodkin, a retail real estate analyst and strategic planner in Del Mar. “They don’t have entertainment, so why do you come there?” But Fashion Square management points to the significant improvement in sales as an indication that the mall is on the right track. “The sales per square foot are more productive in terms of volume against square footage than we were three years ago, so we’re very happy with where we’re headed,” said Ruth Otto Tewalt, vice president and general manager at Fashion Square. “We’re replacing weaker tenants with stronger tenants and we’re seeing the results in sales productivity.” Because of the mall’s size, and its residential location, Fashion Square is not likely ever to be able to add an entertainment component. Instead, it is focusing on a niche that capitalizes on what it can offer: a convenient location with plentiful, easy parking and a selection of stores that appeal to the demographics of the market. “We know because of size limitations that we’re not going to be all things to all people, so we really want to focus on the stores that we think will appeal to our trade-area customer,” said Tewalt. She describes the customer as somewhat older than shoppers at Beverly Center or Century City, and though they are fashion-forward, they are not quite as cutting edge as the shoppers who frequent those Westside malls. Beginning last summer, the mall has added trendy retailers including Betsey Johnson and Planet Funk for women’s apparel, Bose for consumer electronics and Osim, which sells health-related products like massage chairs. Pottery Barn installed one of its prototype design studio stores and Footlocker renovated its stores, combining its men’s and women’s units into a larger format and adding kid’s footwear. So far, the new retailers say business is good. “Christmas-time way exceeded our expectations,” said Stacia Heath, director of West Coast retail for Betsey Johnson. “Since then, our business has been pretty much to goal.” Bose also reports brisk business, especially because of the store’s design specialists who customize audio systems for individual customers, said Terry McWhirter, the store manager. And at Osim, sales are running about even with the chain’s larger stores in Santa Anita and Brea. “We’ve done well,” Rock said. “I’m hoping that the closing of the Galleria will bring a lot more stores and a lot more people into the mall.” Still, competition remains stiff. The mall may be the only game in town between Topanga Plaza to the west and Glendale Galleria to the east, but it still must vie with those centers as well as the malls over the hill, including Beverly Center and Century City. To keep customers on the Valley side, Fashion Square has instituted two incentive programs. One, geared to the many buyers and stylists from the nearby entertainment companies who shop for movie and television wardrobes and props, offers a $500 gift certificate to the buyer who spends the most money at the mall each month. Another, geared to consumers, offers a $100 gift certificate to shoppers who spend $1,000 or more in a calendar month. About 100 studio buyers and 1,500 consumers are registered in the programs, which require that they log their purchases with the mall concierge. “The point is to increase loyalty,” said DiLeva of the two programs. To attract shoppers who don’t frequent the mall, Fashion Square is focusing on refining its retail mix. “We think our shoppers really like to have specialty stores,” DiLeva said. “In the future, leasing efforts are going toward getting (stores) you can’t find anywhere else.” Retailers don’t usually begin moving into malls until the late summer, in preparation for the holiday season, and DiLeva said that while a number of discussions are underway to fill the mall, which currently has an occupancy rate of 88.5 percent, no deals have yet been signed. Consultants said the merchandising strategy makes sense, particularly for a mall without the benefit of an entertainment center. “If you don’t have the space, you have to move on with what you can do,” said Richard Giss, a partner in the trade retail service group of Deloitte & Touche LLP. “You can assemble a very appealing group of stores that are responsive to your demographics and still have a very attractive mall.”

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