Macy's looking for space
By Andrew Gomes
Advertiser Staff Writer
As Macy's West plans for a late-fall conversion of Liberty House stores, the retailer is considering expanding in at least one of the dozen island malls where it operates department stores.
The San Francisco-based retailer has started initial talks about the possibility of leasing the former Shirokiya space at Pearlridge Center next to its Liberty House store, according to a mall official.
If successful, Macy's would gain 19,000 square feet, making its 150,000-square-foot store at the state's second-largest mall about 12 percent bigger.
"We're talking about it," said Marty Lastner, the center's general manager. "It's just initial conversation at this point."
Macy's representatives could not be reached to discuss possible plans. But some local retail industry experts and mall managers said they expect Macy's to seek additional space at some of its locations.
The average Macy's West store is 200,000 to 250,000 square feet. Before its takeover of Liberty House, the company's smallest full-line department stores were about 100,000 square feet.
In Hawai'i, Macy's average department store size is 100,000 square feet. Its smallest is about 40,000 square feet. Four others are around 60,000 square feet or less.
"I would see them working hard to expand these stores if they are going to keep them for the long-term," said Alan C. Beall, president of the local shopping center consulting and development firm the Beall Corp. "They are very savvy retailers. They've got a plan."
Macy's parent, Federated Department Stores Inc., closed on its purchase of Liberty House this month, spending $200 million to acquire the retailer's 12 department stores and seven resort specialty stores in Hawai'i and Guam.
So far, publicly, Macy's has said it plans to increase the depth of the name-brand and private-label merchandise already in Liberty House stores as well as add some new brands.
Among other previously outlined additions will be an expanded shoe department and "The Cellar," the Macy's housewares department featuring product and chef demonstrations.
Much of the retailer's focus will be on the 327,000-square-foot flagship store at Ala Moana Center. But Beall said Macy's is faced with choosing which departments to include in most of its smaller Hawai'i department stores, all but three of which are under 100,000 square feet in gross leaseable area.
"That's going to be a good trick," he said. "Those departments feed off of each other."
Space fits just fine
Another local retail consultant, however, believes Macy's will be fine with existing space at Hawai'i malls.
SL Sofos & Co. principal Stephany Sofos noted that other national retailers have bigger stores on the Mainland because in Hawai'i land costs more and the state's resident and visitor population is mostly divided on four major islands. Therefore, she said, Macy's may consider its stores right-sized for the market and instead focus on maximizing the use and efficiency of existing space.
"Macy's is a pure retailer," Sofos said. "It's all going to be about how they merchandise themselves."
Still, the predecessor to Macy's in Hawai'i had sought more space at some of its locations. For instance, to grow at Kahala Mall, Liberty House was forced to add two unconnected stores in 1992 and 1995.
"With Liberty House it was always a need for more space," said Ron Yoda, center manager. "Here it's always difficult because space hardly becomes vacant."
Yoda said Macy's has not indicated any desire for additional or reconfigured space at the mall where it occupies about 110,000 square feet. "As far as we know they're planning a major renovation of sorts, but we haven't discussed it with them," he said.
Hilo mall weighs in
At Prince Kuhio Plaza in Hilo, Macy's has a 50,000-square-foot store that is about 20,000 square feet smaller than both the Sears and JC Penney anchor spaces.
Carol Van Camp, mall general manager, said that before its sale to Federated, Liberty House had discussed acquiring additional space at the mall, although there were no specific plans.
"At this time we are uncertain about Macy's plans for their Plaza store," she said, "but we are looking forward to working with them to increase their sales in our center."
Prince Kuhio Plaza is about 90 percent full, with a 50,000-square-foot space formerly occupied by Woolworth available, plus another 16,000 square feet in smaller spaces.
Pearlridge in no hurry
At Pearlridge, Lastner said there are only two spaces totaling 4,400 square feet available in addition to the Shirokiya spot, which was vacated by the Japanese department store in March.
Since then, Lastner said there has been lots of interest in the space from small users wanting to use a quarter or less of the space, which could be broken up.
But, Lastner said, the mall is in no rush to re-lease the space, given that its large size and mall-level location next to what will soon become a new Macy's store makes it a valuable asset.
"We want it to be right," he said.
Andrew Gomes can be reached by phone at 525-8065, or by e-mail at agomes@honoluluadvertiser.com
