(Editor’s note: This post was updated at 3:20 p.m. on January 22 with a comment from Nordstrom.)
All signs are pointing to 2013 shaping up as a spectacular year for Louisville retail.
Last Thursday, we broke the story that global fast-fashion brand H & M may be coming to Louisville.
Since then, it’s been non-stop tips coming in from real estate sources, business owners and even economic development execs.
So, now we can tell that if you have Nordstrom on your “The Retail Louisville Needs” wish list – and so many Louisvillians do – there’s a strong possibility you may get to cross them off this year.
Nordstrom to Shelbyville Road Plaza
Sources say Seattle-based department store Nordstrom is in negotiations to put a Nordstrom Rack outlet store in Shelbyville Road Plaza.
A Nordstrom Rack would be the second huge coup for Hagan Properties, the Louisville-based developer that owns the open-air center at 4600 Shelbyville Rd., about one mile west of Oxmoor Center on the Shelbyville Road retail corridor.
In 2011, Hagan Properties landed Trader Joe’s, the Monrovia, Calif.-based specialty market, one of the major retail coups that year in Louisville.
In a brief interview, Tommy Edwards, retail representative at Hagan Properties, said, “We don’t have a signed lease at this time. That’s all I’m going to say on this.”
Colin Johnson, Nordstrom Rack spokesman, said that Nordstrom officials typically don’t comment until there are details to report.
“I can say we’re certainly open to looking at what opportunities might be available in the Louisville market. But we don’t want to comment on a deal that might not happen because we don’t want to disappoint our customers there.”
Nordstrom Rack is the off-price outlet division of Nordstrom, carrying closeout inventory from Nordstrom stores and Nordstrom.com at 50 to 60 percent off suggested retail prices, according to the company website
Nordstrom Rack also sells apparel, accessories and shoes from some of the brands carried in Nordstrom stores, also at deep discounts.
Retailers at the shopping center, who asked not to be identified, confirmed negotiations between Hagan Properties and Norstrom are ongoing.
Those sources say they believe it’s most likely Nordstrom would take the former Border’s Books space, vacated after the bookstore chain liquidated in 2011.
The Borders space is about 30,000-square-foot-plus, and according information on the company’s website, Nordstrom Rack locations average about 30,000 square feet.
And either by coincidence or design, Nordstrom Racks have replaced Borders at shopping centers across the United States, according to media reports.
Norsdtrom Rack executives have announced plans to open 18 of the outlet stores across the United States during 2013, according to the company website, with the heaviest concentration in California. Last June, Nordstrom executives told the Seattle Times they have plans to open 15 new Racks each year, along with eight full-line stores.
According to media accounts, 2011 was one of the best years in the publicly-traded but family-controlled retailer’s 111-year history. (Norstrom shares trade on New York Stock Exchange under the symbol “JWN.”
Nordstrom reported a $683 million profit on record revenue of $10.5 billion. Company executives also announced they intended to spend $600 million to expand the department store chain into Canada and across the United States.
Interestingly, after Nordstrom closed their downtown Indianapolis store, a company vice president told our Steve Kaufman in 2011 that he ruled out a downtown Louisville store, and that the company only sees five viable downtowns including New York and Chicago.
“We need a store to do at least $45 million in (annual) business,” he said. “If it’s less than that, our salespeople aren’t making their desired commissions and it begins costing us too much money when we should be making profits. It also makes it difficult for us to attract top-level personnel, which is the cornerstone of our business.” That’s why Nordstrom recently closed its downtown Indianapolis store. “We can’t live with a $20 million store environment,” said the executive, who asked to speak anonymously because he does not have permission to discus internal policy.
Nordstrom closed stores in downtown Cleveland and Pittsburgh and a few years ago – in a highly publicized move – backed out of a deal for a downtown Cincinnati store, opting for a location in a wealthy suburb.
Major changes at Oxmoor
In addition to our Nordstrom Rack scoop, here’s what we found out yesterday in a boots-on-the-ground tour of Oxmoor Center and Shelbyville Road Plaza.
Mall tenants and others told us yesterday that Oxmoor management was just beginning the process of making major changes at the mall. However, information differed about where H & M might go. Several sources said H & M likely will replace the vacant Elk Creek Winery space.
Others told us H & M would be a 2-story store, replacing Yang Kee Noodle in the front of the mall facing Shelbyville Road.
Not true, says Yang Kee Noodle owner Dan Huckestein. “We’re not going anywhere.”
Yang Kee Noodle, an Asian-inspired restaurant famous for its Firecracker Chicken recipe, exercised a 5-year renewal option back in December, Huckestein said. “We’re here through August 2018 unless (General Growth Properties) wants to buy out our lease.”
But yesterday, Oxmoor management confirmed to him that Chicago-based GGP, the real estate investment trust that owns Oxmoor, remains in negotiations to bring H & M to the East Louisville mall at 7900 Shelbyville Rd.
“They told me they’re still in negotiations with H & M, but they’re just not sure where to put them. If they go next to me, that would be great!”
Dee Snyder, marketing manager for Oxmoor Center and Mall St. Matthews, told Insider Louisville last week that there is “nothing to report” on H & M.
At Oxmoor, management plans major changes including relocating most restaurants in the second-floor food court to the first floor outside the Sears store, according to multiple tenants.
Other retailers have been told they might be asked to move. “(GGP executives) told us there will be an announcement at the end of January about all the changes,” one retailer told Insider Louisville.
The goal, said sources, is to figure out how to revive the area including the food court and the corridor leading into the now-padlocked entrance to Dick’s Sporting Goods. Most of that corridor is is vacant.
Huckestein said business is strong at his first-floor restaurant near the Apple Store, which is why he decided to exercise his lease renewal option rather than relocating.
“We had a lot of options, but we’re staying where we are … because we’re doing very well.”