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Women’s Wear Daily • The Retailers’ Daily Newspaper • November 27, 2006 • $2.00
WWDMONDAY
Accessories/Innerwear/Legwear
It’s Go Time
By David Moin
Christmas can wait, at least for many
shoppers.
That seemed to be the mantra
among the hordes of consumers
who rushed to take advantage of
doorbusters and other bargains
during Black Friday weekend, as many
preferred to shop for themselves ahead of gifts.
As for presents under the tree, electronics and
toys ruled the weekend once again, leaving fashion
lower on shopping lists and stores poised for price
slashing in the weeks ahead.
But retail executives remained upbeat about the
fourth quarter, pointing to the weekend’s buoyant
demand for handbags, diamond jewelry, cashmeres,
party dresses and gift cards. Department and
specialty stores such as Saks Fifth Avenue, J. Crew,
holiday
PHOTO BY ZACK SECKLER
’06
See Early, Page 4
Shoppers
clutter the
sidewalks of
New York’s
Fifth Avenue on
Black Friday.
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ARMANI COUTURE PUSH/2 MULBERRY BRANCHES OUT/9
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WWD, MONDAY, NOVEMBER 27, 2006
WWD.COM
Philo Said Working With Gap
PARIS — Phoebe Philo, who last January resigned
from the creative helm at Chloé, appears to have
already dipped her toe back into fashion, WWD
has learned. According to market sources, Philo
has been quietly consulting for Gap in Europe.
Reached late Friday, a Gap spokeswoman in
London said: “We’ve been working with a number
of external design consultants since we moved the
design team to London this summer. The only one
we’re talking about publicly is Roland Mouret.”
Earlier this month, Mouret’s capsule collection of
dresses arrived in 160 Gap stores in the U.K., Ireland
and France, plus a handful of units in New York.
WWDMONDAY
The company indicated it had pumped up its
European design team to 35 people. “Design is the
way forward on the high street,” Stephen Sunnucks,
president of Europe, Gap Inc. International, said at
the launch of the Mouret line.
It could not immediately be learned if any of
Philo’s design ideas have yet landed on the sales
floor of Gap stores. But the retailer’s women’s
business, which has been lagging in Europe as
well as the U.S., could certainly benefit from the
design prowess of Philo, whose feminine dresses
and coveted handbags helped catapult Chloé into
fashion’s big leagues.
Philo, who has kept a low profile since exiting
Chloé, could not be reached for comment.
Accessories/Innerwear/Legwear
GENERAL
Armani to Raise Couture Presence
luxury strip, which recently welcomed Bottega
Veneta, Chloé and Jimmy Choo boutiques. A
lower-level suite for men’s made-to-measure clothing is among the features of the 4,300-square-foot
Armani unit under construction.
The designer launched his Armani Privé couture
collection in 2005, targeting both traditional couture
buyers and clients for high-end ready-to-wear.
Initially focused on eveningwear, the
collection has recently expanded to
cocktail and daywear. Last July,
Armani opened a couture showroom
at 2 Avenue Montaigne to receive
clients for sales and fittings.
Details about the skin care
launch could not immediately be
learned, but sources said the women’s creams would hit retail as
early as fall 2007 and men’s products be layered on early in 2008.
Armani’s beauty business is licensed to French giant L’Oréal and
has one of the strongest men’s fragrances worldwide, its Acqua di Gio for Men
scent, a bestseller since its 1997 introduction.
A color cosmetics collection was introduced in
September 2001 in extremely tight distribution.
The goal for 2006 was to grow product assortment
by 80 percent, add door count and increase sales
in the U.S. to $27 million at retail, according to
industry sources.
All together, the Armani beauty business is estimated to ring up more than $200 million in retail
sales yearly in the U.S.
— M.S., with contributions from
Jennifer Weil
Aeffe Appoints CEOs at Moschino, Pollini
By Luisa Zargani
MILAN — Aeffe has picked new
leaders for its Moschino and
Pollini brands.
The Italian manufacturer has
appointed Thierry Andretta and
Antonella Tomasetti chief executive officers of Moschino and
Pollini, respectively, effective
Jan. 1.
“We wanted to give more autonomy to each brand,” said
Massimo Ferretti, chairman of
Aeffe, which also controls the
Alberta Ferretti business. “These
appointments are an expression of our intention to expand
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these businesses and accelerate
their growth,” Ferretti said. He
praised Andretta, who was president of Replay U.S., as a “team
man, an experienced manager
who will know how to further develop the Moschino brand.”
The announcements came
after Aeffe’s buyback this month
of a 20 percent stake in the group
from merchant bank Sanpaolo
IMI — a move made to directly
control management and strategies, effectively scrapping the
idea of an initial public offering for the time being. Siblings
Massimo and designer Alberta
Ferretti now control 100 percent
of the company, which also manufactures and distributes collections for Narciso Rodriguez and
Jean Paul Gaultier.
Before working at Replay, Andretta had been ceo of high-end
sportswear company Belfe, chairman of Emanuel Ungaro and Celine and, before that, vice president at Gucci Group in charge of
its emerging brands division.
Moschino is expected to report sales of 70 million euros, or
$89.7 million, in 2006. The brand
also holds a licensing business
of about 200 million euros, or
$256.4 million. Dollar figures
were converted from the euro at
current exchange.
Ferretti said Andretta would
help expand Moschino’s retail
distribution; for example, boutiques are scheduled to open next
year in New Delhi and Istanbul.
Tomasetti will take over
at Pollini for Simone Badioli,
who was the brand’s interim
ceo. Tomasetti was appointed
Moschino’s general manager in
2004, when Marco Gobbetti left
his ceo position for Givenchy.
She had been working as international sales director at Aeffe
since 1993.
“She has 360-degree experience, from marketing to customer service, logistics and production,” Ferretti said. “Now
that we’ve restructured Pollini,
she will be able to accelerate its
growth.”
Aeffe took control of accessories company Pollini in 2001 and
developed it as a ready-to-wear
collection, designed by Rifat
Ozbek. Pollini stores are poised
to open in St. Petersburg and
Moscow next year. The company
is expected to report sales of 65
million euros, or $83.3 million,
in 2006, up 11 percent over the
previous year.
Retail Roundup: Shoppers spent Black Friday hunting for bargains as
well as searching for the holiday’s “must-have” gift items.
16
For any young woman — or two, as the case may be — navigating New
York’s social whirl requires the ability to change on the go.
Giorgio Armani, who rocked London Fashion Week with a huge Emporio
Armani event, is set to make another big splash at the Paris couture.
Italy’s Aeffe has named Thierry Andretta and Antonella Tomasetti as
chief executive officers, respectively, of its Moschino and Pollini units.
BEAUTY: Geneva-based fragrance supplier Givaudan has agreed to
acquire competitor Quest International for $2.3 billion.
INNERWEAR: Eager to glean information about the international trade
show circuit, executives came in force to a seminar on the Lyon fair.
Sir Paul Smith’s new shop in Paris offers ceramic figurines and vintage
toys alongside his own men’s and women’s designs.
EYE
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ARMANI PHOTO BY STEPHANE FEUGERE
PARIS — Giorgio Armani, who rocked London
Fashion Week last September with a huge Emporio
Armani event, is set to make another big splash —
this time at the Paris couture in January.
WWD has learned that the Italian designer is
planning a series of large-scale events to intensify
his couture presence and to mark the opening of a
flagship on the Avenue Montaigne. According
to sources, Armani will also use the occasion to unveil his first foray into skin
care with prestige collections for
women and men.
Armani officials could not immediately be reached for comment.
However, Didier Grumbach,
head of the Chambre Syndicale
de la Haute Couture, confirmed
that Armani has requested an
evening time slot on Jan. 24 and
booked a new and much larger
Giorgio
venue: Paris’ Museum of Modern
Armani
Art, which recently underwent a
major renovation. It is currently the
site of a Karen Kilimnik exhibition.
Previously, Armani opened couture week
with two audiences numbering about 200 each in
relatively small and modest digs, the firm’s showrooms on Rue Lauriston. Sources said the upcoming January couture show, with a gala dinner to
follow, would accommodate approximately 600
guests, including the usual contingent of international celebrities.
Armani is also said to be planning a cocktail
party to celebrate the new store. The unit, which
replaces a previous flagship in Place Vendome,
will be the latest addition to the city’s premier
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COMING THIS WEEK
By Miles Socha
TUESDAY: The Conference Board releases the Consumer
Confidence Index for November.
Chico’s Inc. and Gottschalks Inc. report third-quarter
sales and earnings.
WEDNESDAY: The Federal Reserve Board releases the
Beige Book economic report.
Aéropostale Inc., Bon-Ton Stores and Tiffany & Co.
report third-quarter sales and earnings.
THURSDAY: Major U.S. retailers report November samestore sales.
Kellwood Co. reports third-quarter sales and earnings.
In Brief
● ACTOR APPEALS TO BURBERRY: Ioan Gruffudd, the Welsh
actor and face of the Burberry London fragrance for men, has
appealed to the British brand to rethink the planned closure
of its Welsh factory. As reported in September, Burberry announced plans to shutter its factory in Treorchy, south Wales
because it is no longer commercially viable. A Burberry spokeswoman on Sunday confirmed that Gruffudd had e-mailed
Burberry chief Angela Ahrendts asking her to do whatever she
could to keep the factory open. The Sunday Times of London
reported that Prince Charles also made an appeal to government ministers to ask if there was anything he could do to help.
However, a spokesman for the Prince told WWD he was not
aware of any appeal on the part of Prince Charles. The factory,
which has been in operation since 1939, makes polo shirts and
currently employs 311. Burberry is holding weekly meetings
with unions to discuss the future of the factory, and the fate of
employees should the plant close for good.
Correction
An incorrect photo accompanied a story on
page 12, Tuesday, about the renovated Chanel
boutique on Michigan Avenue in Chicago.
Here, the correct photo by Karen Hoyt.
WWD, MONDAY, NOVEMBER 27, 2006 3
WWD.COM
Givaudan-Quest: Creating a New Number One
By Brid Costello and Matthew W. Evans
Gilles Andrier
W
ith its $2.3 billion acquisition of competitor
Quest International last week, fragrance supplier
Givaudan vaulted to the top of the heap and redrew the
competitive map.
Givaudan, based in Vernier, Switzerland, and Quest,
the flavors and fragrance business unit of U.K.-based
Imperial Chemical Industries plc, expect the deal to be
finalized during the first quarter of next year. The acquisition, which is valued at 1.2 billion British pounds, or about
2.8 billion Swiss francs, or $2.3 billion at current exchange,
is subject to regulatory and shareholder approval.
Along with flavors and fragrance suppliers Firmenich, International Flavors & Fragrances and Symrise,
Givaudan and Quest are in the top tier of players within
the flavor and fragrance supply industry. Their business
segments include fragrance production for consumer
products such as perfumes, shampoo and detergent, as
well as flavors for the food and beverage industries.
Givaudan expects the acquisition of Quest to “extend
Givaudan’s leadership position in all strategic segments
of the fragrance and flavor industry,” the company said
in a statement.
Combined annual revenues of the companies are
expected to be about four billion Swiss francs, or $3.26
billion, of which 44 percent would be derived from its
fragrance business and 56 percent from flavors. That
would mean its fragrance sales would weigh in at approximately 1.76 billion Swiss francs, or $1.43 billion.
Givaudan said it expects to achieve annual synergies
of 150 million Swiss francs, or $122.2 million, with “full
benefits” realized the third year after the acquisition.
The deal is to be funded by debt and an issuance of one
billion Swiss francs, or $815.6 million, in equity.
The Givaudan-Quest deal marks one of the biggest acquisitions — in an industry punctuated in recent years
by consolidation — since the 2002 merger of Haarmann
& Reimer and Dragoco, which at the time had combined
sales of $1.42 billion, a deal that spawned Symrise.
Givaudan itself was merged with fragrance supplier
Roure in 1991 by then parent company Roche and was
known as Givaudan Roure for about a decade.
“In fragrances, Givaudan will
become the global market leader in
fine fragrances and [fragrances for]
consumer products,” the company
said. “Furthermore, it will expand
the customer base and strengthen
its position with existing clients.”
To put that in context, according to a ranking commissioned by WWD Beauty Report International earlier
this year, Firmenich topped the list of the 10 largest fragrance suppliers worldwide in 2005 with sales estimated
by industry sources to have hit 1.53 billion Swiss francs,
or $1.23 billion at average exchange for 2005, followed by
IFF with $1.14 billion. Givaudan took the third spot with
1.13 billion Swiss francs, or $910 million; Symrise was
fourth with 609 million euros, or $758 million, in sales
volume, according to industry sources, and Quest came
in fifth with sales of 301 million pounds, or $548 million.
In 2005, Quest rang up total sales, including its fragrance and flavors businesses, of 560 million pounds, or
$1.02 billion at average exchange, while Givaudan generated 2.8 billion Swiss francs, or $2.3 billion.
“I am genuinely very excited about the opportunity
we have to combine Givaudan and Quest,” said Gilles
Andrier, Givaudan’s chief executive officer, during a
conference call on Wednesday. “This is a transforma-
tional event for both companies, and we are we convinced that this transaction will reshape the status quo
of our industry.”
Andrier outlined the strategic rationale behind the
acquisition, noting the deal expands Givaudan’s global
reach, enhances its pool of creative talent, expands its
consumer understanding, improves its product and service offering and strengthens its technological and research-and-development capabilities.
“Together with Quest, we will form an unrivaled platform to provide an even more comprehensive service to
our customers around the globe,”
said Andrier. “Combined, the companies give rise to a balanced global footprint with significant sales in
all global regions.
“Acquiring Quest is a key step to
realizing our strategic vision of becoming the essential
source of sensory innovation for our customers,” continued Andrier.
Quest, which has headquarters in Naarden, the
Netherlands, was acquired by ICI from Unilever in 1997.
“This is an outstanding opportunity for Quest,” said
Isabelle Parize, group vice president of fragrances at
Quest, in a statement from the firm. “Givaudan has an
inspiring and long history in fragrance creation. We will
be joining the most respected and profitable business
in our industry and creating a clear market leader. The
combined businesses provide a powerful innovation
platform and we are delighted about the extra value we
will be able to offer our clients. Through this deal we
will be in a position to better leverage our joint capabilities in the areas of consumer and sensory understanding, technology and science.”
Fragrance consultant Ann Gottlieb, president of Ann
Gottlieb Associates, sees the deal as a beneficial marriage that will help both Givaudan and Quest, particu-
BEAUTY BEAT
ANDRIER PHOTO BY CHRISTOPHE BOSSET-BLOOMBERG NEWS-LANDOV
Ralph Lauren’s
Polo Double Black.
Sean Combs’ Unforgivable.
larly in light of the recent advent of manufacturers restricting the number of their suppliers with “core lists.”
Some manufacturing clients had listed one company but
not the other.
“It’s going to be easier for the fragrance companies to
have relationships with the cosmetics companies,” she
noted. “This is a great move for Givaudan,” she said, but
pointed out that the benefits are more mixed for Quest.
The management of Quest, led by executives like Parize,
was beginning to make headway in moving the company
forward.
“Now, no one will ever see where the company could
have gone,” Gottlieb noted.
Indeed, John McAdam, ceo of ICI, said in a letter to
colleagues, “Quest has for many years been one of ICI’s
‘Grow Aggressively’ businesses and the management
team has done a good job of progressively improving
performance and developing its market position. The
business has been growing its top line faster than its
markets’ rate of growth and expanding margins. It is
clearly heading in the right direction and on track to
return to its pre-2003 margin levels.”
He added in the statement, “At the same time, it was
well known that the flavors and fragrance industry was
likely to experience further consolidation. Quest is one of
five leading global players, amongst hundreds of national
and regional flavor and fragrance houses. The combined
Quest/Givaudan business will be number one in all regions in almost all flavors and fragrance sectors. I am genuinely excited by the opportunity this gives Quest, not just
to continue its growth but to be part of the industry leader
in flavors and fragrances with all the advantages, opportunities and challenges that come with such a position.”
When asked what effect core lists had when the deal
was being drawn up, Cosimo Policastro, Givaudan’s
executive vice president of fine fragrances for North
America, said, “It’s a reality of our business. But I don’t
think you can slice this down and say core lists had
any major influence,” he said during an interview in
New York Wednesday. “It certainly has influence, but I
wouldn’t suggest any more or less than the other things
one considers when one looks at growth opportunities.
“To make an acquisition of this size, there were a lot
of things taken into consideration,” he said, adding that
the deal “makes us number one in fine fragrance and
puts us in a better position with our top consumer products companies.”
In terms of perfumery, the two companies complement
each other, Gottlieb added. Givaudan has been strong
recently in men’s fine fragrances, winning the contracts
for Ralph Lauren’s Polo Double Black and Sean Combs’
Unforgivable. But it has been weak on the women’s side
of the business and that’s where Quest is strong.
Industry consultant Allan Mottus compared the union
to Federated Department Store Inc.’s acquisition of May
Co. “You might as well get the stronger players together
while you can,” he remarked. Mottus noted that beauty
firms are asking suppliers for better prices, which in
turn has forced suppliers to knock down overhead.
“You have more global companies today, so having
corporate size and financial wherewithal is important,”
he said.
— With contributions from
Pete Born and Molly Prior
4
WWD, MONDAY, NOVEMBER 27, 2006
Early Sales Lure Shoppers
Continued from page one
Macy’s, Bloomingdale’s and Lord & Taylor were far less
promotional than discounters and outlets, and no more
so than last year.
According to the National Retail Federation’s
2006 Black Friday Weekend Survey, conducted by the
BIGresearch consumer research firm, more than 140
million shoppers hit the stores on Black Friday weekend, spending an average of $360.15, up 18.9 percent
from last year’s $302.81. “Each year, consumers have
greater expectations for doorbuster specials, forcing retailers to raise the bar,” said NRF President and chief
executive Tracy Mullin. “This year, stores did not disappoint as deals on high definition televisions and apparel
were just too good to pass up.”
As of Sunday, the average person has completed 35.6
percent of their holiday shopping, showing no change
from last year, NRF said. Only one in 12 consumers
has finished their holiday shopping. NRF continues to
project that holiday sales will rise 5 percent this year to
$457.4 billion. The survey polled 3,090 consumers from
Nov. 23 to 25.
Jack Kyser, chief economist with the Los Angeles
Economic Development Corporation called the weekend “a good start” to a potentially robust season, citing increased consumer confidence in the economy in
Southern California following the Democratic sweep
in the mid-term elections. “In Southern California, the
economy is very, very good. Los Angeles County unemployment is 4.3 percent — and we characterize that as beyond good employment — and the housing market didn’t tank like people thought it would.”
Even as many consumers focused on buying for themselves over the Black Friday
weekend stores recognize the serious gift
shopping will happen, even if it comes
late in the season. Stores are generally
projecting mid-single-digit gains, despite
relatively mild temperatures that hurt demand for coats and cold-weather accessories during the weekend. The home market
also lagged, as the housing market softens.
“If you didn’t have electronics, you may
have suffered,” observed Ken Lakin, chairman
and ceo of Boscov’s, the Reading, Pa.-based full-line department store chain.
“We were pleased with our results. We were right
on target, but I hope it gets cold,” said Michael Gould,
chairman and ceo of Bloomingdale’s. “We have markdowns and good value in our stores, but we don’t deal
with doorbusters. Our average unit ticket sale on Friday
was 10 percent higher than last year, and on Saturday, it
was 13 percent higher, pretty much in line with our average unit price increase all year long, which was about
9 percent higher. That says to me we sent a much better
ticket out the door.”
Gould acknowledged the high level of self-purchasing,
and cited fashion accessories, particularly handbags, as
the strongest area, with shoes from Chanel to Uggs, as well
as contemporary sportswear and denim, also strong.
“It was a good start, but it’s a long time between
Thanksgiving and Christmas,” said Ron Klein, chairman
and ceo of Macy’s East. “The crowds looked a little bit
larger this year.”
He cited men’s collections, cosmetics, handbags,
dresses, and fine jewelry as top categories. “The weather didn’t ignite cold-weather merchandise, but cashmere was strong,” Klein said. “Cashmere is not about
keeping warm. It’s about affordable luxury.”
Jane Elfers, ceo of Lord & Taylor, agreed with Klein.
“Nothing happened over the weekend that would make
me change my outlook,” she said. “Department stores
are in a good place. It will be a fairly strong season.
By far the best businesses [over the weekend] were
handbags, fine jewelry which is really diamonds, Ugg
boots, special occasion and little black dresses, cocktail
dresses, designer handbags particularly from Coach and
Dooney & Bourke. “It’s a six-week season and we just
finished the first two days.”
But if the opening weekend is any indication, the holiday will once again be about hot electronic items, toys
and gift cards rather than a fashion trend. “It was kind
of a strange weekend, with very high volume and traffic,” Boscov’s Lakin added. “Electronics and jewelry really led the day. We had to reorder plasma TVs, probably
the single biggest item we had, and a lot of jewelry,” particularly diamond stud earrings and tennis bracelets.
“Apparel didn’t really happen. It was OK.”
In years past, such categories as Nordic fleece, pashminas, boots, chunky merino wool and cashmere sweaters would pace sales right after Thanksgiving, Lakin said.
But with that not happening, “prices are going to come
down on apparel and cold-weather items just when it
gets cold, so it should be good for the consumer.”
holiday
’06
Macy’s Herald Square on Black Friday.
It could be a couple of weeks before retailers see a
significant pickup in winter-related goods, considering
a mild first half of December, and a colder second-half
forecast. “There could be a lot of inventory around, and
you better believe it will be sharply priced,” Lakin said.
Steve Sadove, ceo of Saks Fifth Avenue Enterprises,
was out in the malls in the Washington D.C. area Friday
and Saturday. “There certainly was a lot of traffic. The
mood was good. Stores were busy. People were responding to the fashion and a lot of the key items, things like
handbags, accessories, cosmetics, fragrances, and men’s
sportswear.”
However, the outlook for Saks’ regular-priced stores
looks good as well, especially with the stock market
strong and high bonuses expected on Wall Street. “The
mood at the luxury end is positive,” Sadove said. “The
day after Thanksgiving is very important. It sets a tone
for the season, but it’s not the only important day,”
Sadove added. “The luxury sector is somewhat less dependent on that day than other parts of the retail indus-
try. Loyalty shopping days at Saks can be bigger volume
days than Black Friday.”
For mainstream retailers, however, Black Friday is
typically the second or third largest volume day of the
year, next to the Saturday or Saturdays before Christmas
Day. It also has become a period of major promotions by
retailers, some of whom opened at midnight this year
for the first time to excite the consumer. But in many
cases, it was the promotions that consumers zeroed in
on, rather than regularly priced merchandise.
“Everyone was cherry picking for sales,” admitted
one ceo of a fashion chain. “Electronics, doorbuster specials, toys, MP3s, iPods, plasma TVs, they were all out of
control. That didn’t help us a lot. Thanksgiving weekend
was not a great indicator for us. It’s too early to tell,”
how the season will evolve.
MASS APPEAL
While many discount stores were packed over the
weekend, it wasn’t all holiday cheer. Wal-Mart said its
WWD, MONDAY, NOVEMBER 27, 2006 5
WWD.COM
The throng by Saks’ holiday windows.
Window shopping at Bergdorf Goodman.
Hot Stuff
Based on consumer demand at Shopping.com
on Black Friday, the most popular products
for the 2006 holiday season include:
The average ticket price at Bloomingdale’s
in SoHo was higher than last year.
PHOTOS BY JOHN CALABRESE; NAN COULTER; ZACK SECKLAR AND KEITH SMITH
Dallas Galleria
comp store sales would dip 0.1 percent in November,
the first negative comp in years and a continuation of
the retailer’s woes in its flagship U.S. business. Walmart.
com was caught off guard by a traffic surge that began in
the wee hours Friday morning and caused crashes and
delays. Starting Thanksgiving Day, the site’s traffic has
been up 60 percent, which “greatly exceeds the high end
of our forecast,” said Walmart.com spokeswoman Amy
Colella on Friday.
Wal-Mart offered several Web-only deals, including
a George bathrobe for $12. The best seller was a Kodak
digital camera and printer for $189.74. Samsclub.com
also offered Web exclusives on Black Friday, including
an Anne Klein silk trenchcoat for $88.88 and half-carat
diamond studs for $897.
At the Atlanta Wal-Mart, open a month ago, the hottest apparel items were Levi women’s jeans, on sale
for $12, and terry cloth robes, for men and women, at
$17, which went through “several boxes of stock before
noon,” said Rudy Sims, market manager for nine Wal-
Marts in North Georgia.
“Our plan of spreading out hot items on endcaps
throughout the stores, to avoid crowding, worked well,”
said Sims.”
At a Target in Saugus, Mass., shoppers jumped on
deals. A Mossimo wool portrait-collar coat, on sale for $35,
was nearly gone. Behnaz Sarafpour’s white cocktail dress
with black cummerbund and plum silk blouse with grosgrain tie also seemed to be a hit, based on low inventory.
The Minneapolis-based retailer appeared to be doing
a brisk business in cold-weather accessories, video
games and holiday decor. Close to a dozen staffers were
restocking the Christmas department and answering
questions about light sets and artificial trees.
At a Target north of New York City on Saturday, demand also seemed to be stronger for holiday decorations and electronics than for fashion. The accessories
department was heavily shopped, but the women’s area
— including the Sephora and Isaac Mizrahi items — was
virtually deserted.
ELECTRONICS
Apple iPod Nano and iPod Video
Microsoft Xbox 360 video game console
PlayStation 3 video game console and
PlayStation Portable video game console
Canon PowerShot SD600 digital camera
Panasonic 50 inch HDTV plasma TV
Samsung 42 inch HDTV
TOYS
TMX Tickle Me Elmo
LeapFrog Leapster multimedia learning system
My Little Pony crystal rainbow castle
Hasbro Fur Real Friends Butterscotch Plush Pony
Fisher-Price Power Wheels Barbie Jammin’ Jeep Wrangler
HOME
Cuisinart 12-Cup coffee maker
Dirt Devil Kone vacuum
iRobot Roomba vacuum
Cuisinart 7-Cup food processor
George Foreman G5 indoor grill
CLOTHING/ACCESSORIES
Michael Kors Michael slouch harness boot
Adidas a3 Gigaride men’s running shoes
Ugg’s women’s boots
Spy Astro sunglasses
Oakley Women’s Minute sunglasses
MALL MADNESS
Karen MacDonald, director of communications for
Taubman Centers, said: “We had two solid days of postThanksgiving business, with Friday definitely the stronger of the two. Most stores were trending low-to-midsingle digit gains for Saturday, and Friday, with Florida
trending higher.
No particular item stood out, but electronics, toys and
beauty were the hottest categories. There were more teens
and more men out for early birds on Friday, particularly teens.
They were out there five or six o’clock in the morning.”
The luxury mall Lenox Square in Atlanta, owned
by Simon Properties, opened at 6 a.m. Black Friday,
two hours earlier than recent years. Approximately 40
stores, including Macy’s, Gap, The Limited, Express,
Victoria’s Secret and the Apple Store participated in
Black Friday sales that ended at noon, and 65 had daylong promotions. “Such Black Friday discounts aren’t as
common in mall stores as in Wal-Mart, Target and Best
continued on page 6
6
WWD, MONDAY, NOVEMBER 27, 2006
WWD.COM
Toys, Gadgets Trump Apparel
Despite the name change, Macy’s on State
Street, formerly Marshall Field’s, drew crowds.
Continued from page 5
Buy,” said Dewayne Herbert, marketing manager for Lenox
Square. “The parking lot was 40 percent full at 6 a.m.”
“Traffic was absolutely much better than last year,” said
Janet LaFevre, marketing manager for Glendale Galleria
in Glendale, Calif. “And it started really, really early. I was
shocked at the number of people in the center at 5 a.m. Even
though the shopping center wasn’t supposed to open until 6
a.m., stores like Penney’s and Disney opened earlier.”
“Crowds were larger than expected,” said Debra Gunn
Downing, executive director of marketing for South Coast
Plaza in Costa Mesa, Calif., where stores began opening at 5
a.m. Many luxury stores at the center, including Tory Burch
and Bulgari, reported significant full-priced selling, and a large
percentage of people who were shopping for themselves.
SPECIALTY STORES ON PLAN
At J. Crew, “We are very pleased with business both
Saturday and Friday. The momentum for J. Crew continues,” said Margot Brunelle, head of marketing. Bestsellers
included argyle cashmere cardigans and crewnecks, $168;
cashmere hoodies, $168; double cloth wool coat, $298; as
well as wedding and party dresses, including an Ava silk
halter $215; and a silk taffeta tuxedo dress with embroidered eyelet trim, $1,450 to $2000, depending on the length.
Novelty lounge pieces have also been selling well, including boxers and pull-on pajama pants.
Dress Barn and its sister division Maurices both reported making plan Friday and Saturday. “We got a lot of action on dressy merchandise, and had strong selling in new
spring receipts. We are confident for December,” said Keith
Fulsher, Dress Barn’s senior vice president and general
merchandise manager. “Inventories are clean,” with denim,
hoodies and sweaters showing the strongest sales, said Lisa
Rhodes, executive vice president and general merchandise
manager for Maurice’s.
Gap Inc., which has been struggling all year, had a ray
of hope. “There’s a sense that there was a steady stream
of traffic and everyone was pleased,” said Robin Carr, director of media relations. “Traffic in Banana Republic and
Gap stores was up from last year. ”
Shearling coats, crocodile handbags and jewelry sold
well at Louis Boston on Friday and Saturday. “The usual
suspects for women who have generous husbands,” quipped
Louis Boston owner Debi Greenberg.
In Wellesley, Mass., GrettaLuxe had a big denim day
Friday, seeing as many out-of-towners as regular clients.
J Brand denim and cord sold well, as did True Religion.
Black denim in tapered but not superskinny fit sold well.
Sales Friday and Saturday were up about 15 percent
from last year at Jake, an upscale men’s and women’s boutique with locations along Southport Avenue and Rush
Street in Chicago, owner Lance Lawson said.
Shoppers gravitated to Jake’s private label cashmere
dresses and tunics for $285 and party dresses, most notably
short shiftdresses from Thread Social and various styles
PHOTOS BY MICAH BAIRD; ZACK SECKLER; KEITH SMITH AND PHILIP SHONE
The Atlanta shopping scene.
from 3.1 Phillip Lim, Lawson said. Denim sales, in contrast,
have slowed to almost a trickle, except for Cheap Monday
black tight jeans, $65. Tom Ford sunglasses, $300, continue
to be a popular gift item as well, Lawson added.
The 50-degree plus temperatures over the weekend
helped Scoop NYC in Chicago score high numbers. The
above-normal temperatures put shoppers in a good mood,
said store manager Suzanne Workman. When two women
wanted the same wool Thread for Scoop jumper one bought
the dress in a larger size so she could take it home Friday.
Other top sellers included quilted leather Scoop ballet flats
for $165 and loungewear from Free City at $148 and sweaters
from Marc by Marc Jacobs starting at $175, Workman said.
DEPARTMENT STORES ENCOURAGED, NOT ECSTATIC
“It leaves one optimistic, but it’s a long season,” said
Robert Mettler, chairman and ceo of Macy’s West, whose
stores opened at 6 a.m. on Friday to hordes eager to take
advantage of storewide doorbusters. The key to the season,
according to Mettler, is “ensuring every week there’s new
and interesting products, so the customer is enticed.”
“Out of the gate, we feel the traffic is a little stronger
than last year,” said Lori Randolph, vice president and general manager of the Macy’s Union Square flagship in San
Francisco, adding that the line there comprised roughly 200
people. Bestsellers in women’s apparel at the flagship included cashmere sweaters and velour separates from Macy’s
private label, Charter Club, as well as flared and skinny jeans
from Citizens of Humanity and Seven for All Mankind.
“The company is definitely feeling encouraged by the resurgence in the home division,” said Randolph. “We had a very
busy Friday morning in the Cellar…and gift cards sold well.
Every year more and more people are purchasing them.”
Traffic at Macy’s on State Street seemed comparable
if not slightly higher than last year when it carried the
Marshall Field’s moniker, and crowds still gathered outside elbow-to-elbow often six people deep to see the store’s
popular holiday window displays, said Jennifer McNamara,
public relations manager for Macy’s North. Shoppers took
advantage of Macy’s Friday 6 a.m. until noon special promotions, such as a Sebring 5-piece luggage set for $49.99, and
a one-carat diamond circle pendant for $99.99. Otherwise,
cashmere sweaters at a variety of price points, outerwear
and handbags were best-selling categories Friday and
Saturday, according to the store.
In particular, women bought leather jackets, jackets with
faux fur trim and puff jackets as well as handbags from
Coach, Kate Spade and Dooney & Bourke, she said.
At Belk Inc., “overall we were pleased with the day,”
said Steve Pernotto, executive vice president. “Key classifications were sweaters and knits, denim, cosmetics and
personal electronic entertainment items. Consumers in the
stores were upbeat and having fun.”
— With contributions from Georgia Lee, Rusty
Williamson, Beth Wilson, Emili Vesilind,
Kristi Ellis, and Kate Bowers
Crowds, Confusion,
Discounts Aplenty
At Garden State Plaza
PARAMUS, N.J. — Thousands of eager shoppers
lined up at 5 a.m. on Friday outside Macy’s and
J.C. Penney at Westfield Garden State Plaza here,
only to learn the stores wouldn’t be opening for
another two hours.
Both department stores advertised 5 a.m.
starts in national television commercials and in
newspapers, but local ordinances prohibit stores
from opening before 7 a.m.
“It happens every year,” Lisa Herrmann,
marketing director of the mall, said of the
confusion.
But the mall was ready. Anticipating the
predawn throngs, the shopping center had
magicians on hand to perform and the buff
New Jersey Calendar Cops, who call themselves
the fittest and the finest, were leading warmup exercises outside Macy’s. There were
complimentary massage chairs and makeovers, as
well as free coffee and muffins.
By 7 a.m., when the shopping center officially
opened, 10,000 parking spaces were filled,
Herrmann said. The mall, which has 2 million
square feet of retail space, was expecting over
100,000 shoppers.
Cars were lined up outside Joe’s American Bar
and Grill, waiting for valet parking, which cost $5.
“We start at 12 and not a minute sooner,” the valet
manager barked at a shopper at 11:57. She rolled
her eyes and drove away.
“This is the first time I’m shopping on Black
Friday,” said Liliana Neto, who, along with her
husband Wilson, was weighed down with bags from
Gap Kids. “There are good discounts. I didn’t do
any Christmas shopping, though. We always leave
that for the last minute.”
Teens were out in force, walking in and out of
stores in groups and carrying shopping bags from
Hollister, Abercrombie & Fitch and Limited Too.
“It’s a little cheaper today,” said Jasmine Choi.
Her friend, Christina Hwang, added, “We still have
a long way to go. We’re going to Abercrombie and
Victoria’s Secret. We’ll probably be spending more
this year. We have more people to give gifts to.”
Outside Hollister, teenage girls and boys sat
on the steps, evidence of their shopping strewn
at their feet. “It’s much busier than normal
today,” said Kerri MacKay, a Hollister employee.
“We opened at 7 a.m. and there were a ton of
people waiting to get in. Fleece sweatpants and
sweatshirts are selling really fast. We’ve been
reaching all our goals on items. Nothing’s sold out
because we have a big stock. We were ready for a
lot of people.”
Coach also had a crowd waiting at 7 when the
doors opened. “People are buying gifts across the
board,” said a salesman. “They’re buying little
gifts and major purchases. We were busy from the
minute we opened. Last year, the traffic trickled
up.”
A promotion at Charlotte Russe — 25 percent
off everything that could be stuffed into the store’s
shopping bag — drew a big crowd. The checkout
line was about 40 people deep throughout the
day, said an employee. Nashira Montesino, a
high school senior, said, “I saw the huge line and
figured it had to be something good. I’m shopping
for myself today. Next I’m going to go to Forever
21, Guess and H&M. I’ll be spending more than
last year.”
Denise Dorso had much to be happy about,
including a parking space and a pair of Anne
Klein boots for $73 at Macy’s. “I’m supposed to
be shopping for everyone else, but the deals were
so good,” she said. “You get really good offers
between 7 a.m. and noon.”
Standing outside Sephora with her husband,
Walter, Dolores Steffen looked shell-shocked. “I
can’t take much more of the noise,” she said.
“Most of the population is below our age. Normally
I wouldn’t go out on a day like today, but we’re with
our grandchildren. I like shopping and getting good
values, but I can go any time I like. I’m inclined to
give more gift cards and money this year.”
A customer sitting on a bench at Nordstrom
and catching her breath said, “I did a little bit of
shopping, but I’ll never do this again. It’s way too
crazy. People were screaming at each other in the
parking lot. I’ll probably do most of my shopping
online.”
— Sharon Edelson
8
WWD, MONDAY, NOVEMBER 27, 2006
WWD.COM
Innerwear Report
Global Flair Tops Trade Show Talk
INTIMATE NOTES
NATORI FETES ORCHESTRA: More than 50 guests, including
executives of the fashion and retailing industries, recently enjoyed
Champagne and chamber music at a cocktail party for the
Orchestra of St. Luke’s at the home of Kenneth and Josie Natori.
The event was co-hosted by Georgia Frasch and Josie
Natori, both of whom are on the board of St. Luke’s, and
attendees included Vera Wang; Pamela Fiori; Adrienne
Vittadini; Stephen Dweck; Jamee Gregory; Ron Frasch, chief
merchant at Saks Fifth Avenue, and Marianne Lockwood,
executive director and founder of the orchestra.
Josie Natori and Vera Wang
Ron and Georgia Frasch
Kenneth Natori Jr.,
Kenneth Natori and
Anika Proskurowski.
rie trade session is to be launched at the end of March in Hong Kong. The decision to
create a second fair in Asia was based on improving the calendar needs of manufacturers and distributors to ensure the quality of supply chain issues, timely deliveries
and on-trend merchandise, she said.
As for the upcoming SIL edition in Paris, Hebert said it will have a “new visual
identity,” encompassing 580 international brands. New segments will include cosmetics, candles and bath and body products; maternity items, and expanded forums for
men’s underwear and plus sizes. There also will be retail seminars and the Feb. 2 to 4
Interfilière section will conduct conferences on eco-friendly fibers, as well as directional trend presentations, including Antiquité a Gogo, Bubbles & Bling and Ultra Nature.
Supermodel Eva Herzegovina will head a panel of jurists who will select the winners.
The Lyon, Mode City edition in 2007 is slated for
Sept. 1 to 3. In addition to an expanded men’s innerwear area, there will be a focus on a new category:
Sport Active, which will include sporting equipment.
Addressing the absence of several key French
lingerie brands such as Chantelle and Aubade at
this year’s Lyon fair in September, Hebert said,
“Lyon, Mode City has existed for 20 years, and we
pull in 19,000 visitors, 60 percent of whom are international. We were forced to scrutinize our show
and survey customers. Fifty percent said the Lyon
dates were not appropriate, while 50 percent said
no clear solution could be found.
“We decided to keep the [Lyon] dates because it
attracts the international lingerie and swimwear industries, and it brings an opportunity to start a new
season. There’s back-to-school for the boutiques,
and what’s really wonderful is the prêt-à-porter
Silvia Harven,
shows in Paris following Lyon. That pleases a numcreative director of
ber of people.”
Abercrombie & Fitch.
Addressing key trends at the Lyon show, Harven
of Abercrombie & Fitch presented a slide show
of looks she found to be directional, including French Impressionist-inspired corsetry with soft, romantic colors from Renoir or Van Gogh; antique porcelain doll hues;
Empire lines, and reembroidered laces. There also was a new direction in creating texture in a fabric through bows, rib patterns, trims and novelty embroideries, she said.
Harven noted that “structured elegance” and a “huge return” to Santoni seamless
styles were gaining importance, as well as a trend she described as “eternal youth” in
shades that ranged from “pop art to soda pop,” like Sprite, bubble gum, carnation and
sun. A lot of these lingerie styles are taking their cue from swimwear, she said.
Finally, Harven singled out exotic macro trends that lend a sense of escapism to
classic lingerie, such as crochets from Brazil, lattice and scroll effects, delicate filigree embroideries and ready-to-wear-inspired color blocking.
Among the music performed were Kreisler’s “Tambourin
Chinois,” “The Swan” from “Carnival of the Animals” by
Saint-Saens and Haydn’s “Piano Trio in G Major, also known as
“Gypsy Trio.” The St. Luke’s musicians were pianist Elizabeth
DiFelice, cellist Daire FitzGerald and violinist Naoko Tanaka.
The buzz at the party was how difficult it was to get
a ticket to Paul McCartney’s oratorio “Ecce Cor Meum”
(“Behold My Heart”), which was performed at Carnegie Hall
Nov. 14. McCartney’s work, written in the style of traditional
English choral music, was composed in memory of his first
wife, Linda. But getting into the papparazzi-filled event was
a breeze for the Orchestra of St. Luke’s, since it performed at
the soldout event.
NO NONSENSE BRAS: Kayser-Roth has signed a licensing
agreement with Ariela Alpha International to design,
merchandise, produce, market and distribute the first line of
bras bearing the No nonsense label for spring 2007.
The move into the bra market is a building block of
the No nonsense franchise, which, in addition to hosiery,
has expanded over the past several years to include casual
legwear, socks, underwear, sleepwear and slippers.
Julia Townsend, executive vice president and general
manager of Kayser-Roth, said, “We think that through our
partnership with AAI, No nonsense can bring innovation, style
and a modern sensibility to the bra category.”
Ariela Balk, president and chief executive officer of AAI,
said, “No nonsense is all about solutions for women and
that is a perfect platform for a successful bra line.” Bra cup
sizes will start at 32C and go to 40D. Suggested retail will be
around $20 for all bra styles, said Balk.
“It will be a hanging program with upscale hangtags and
will be very solution-driven,” she said. “The hangtags will
describe what each bra does and the problem it solves.”
Balk said distribution is aimed at promotional department
stores, as well as mass merchants and food and drug store
chains. First-year wholesale sales are projected at $25
million, said Balk. AAI also does private label programs for
major retailers, including Wal-Mart, J.C. Penney and Sears,
and manufactures bras and daywear under license bearing the
Fruit of the Loom and l.e.i names.
PAJAMA PARTY: The Pajama Program, an organization that delivers
warm sleepwear and books to children in need, will open its first
Pajama Program Reading Center in Manhattan on Dec. 5.
Created in 2001 with 12 pairs of pajamas by founder and
executive director Genevieve Piturro, the organization will be
donating almost 75,000 pairs of pajamas to children by year’s
Pajama Program artists from left: Nikki Silananda,
merchandising assistant at Richard Leeds International; Terri
Jasen, Pajama Program’s national program director; Drew
Gold, a freelance artist; Marcia Leeds, chairman of the Leeds
company; Ronald Callahan, creative artist at the Leeds company;
Genevieve Piturro, founder and executive director of the Pajama
Program, and Karin Gold, art director at the Leeds company.
end. The majority of the children, ranging from infants to
teenagers, as well as teen moms, live in group homes because
they are either abandoned or have no family.
When it came to decorating the new reading room at 34
East 39th Street, artists from sleepwear company Richard
Leeds International dropped by and painted a mural of
characters ranging from Cinderella to Big Bird.
“We’ll have 10 to 15 kids at our ribbon-cutting,” said
Piturro, noting that Scholastic, St. Martin’s Press, and Lee and
Low Books Inc. had contributed “hundreds of new books.”
In addition to the Leeds firm, companies that have donated
pajamas include Lollytogs, St. Eve International, Ganis Bros.,
Delta Galil USA, Greggy Girl, Salta International, Stargate/
Baby Buns, Skivvy Doodles/My Boy Sam and Wundies.
Recalling how she started the organization, Piturro said
she was appalled by the number of underprivileged children
who had to sleep in their street clothes.
“I went to a place where they were sheltering abused
children in Spanish Harlem,” she said. “Just about every time
I went to volunteer, I was so saddened by the conditions these
kids went to sleep in. It was so opposite to the experience I
had, a warm, loving home where I was tucked in at night and
read a bedtime story.”
ST. LUKE’S PHOTOS BY JIMI CELESTE; PAJAMA PROGRAM BY TALAYA CENTENO
T
he prospect of gleaning information about the international trade show circuit
drew 130 innerwear executives to a seminar on fabric and intimate trends from
the Lyon, Mode City fair.
However, the event, staged Nov. 9 by The Underfashion Club Inc. at the Park
Avenue Country Club restaurant in Manhattan, did not focus exclusively on the
Lyon edition. A brief overview also was given of the Shanghai, Mode Lingerie sourcing, fabrics and intimates fair, as well as a snapshot of what to expect at the Salon
International de la Lingerie in Paris from Feb. 2 to 5.
The speakers were Anne-Manuele Hebert, international department manager
for French trade show giant Eurovet, and Silvia
Harven, creative director of Abercrombie & Fitch.
Harven’s background is primarily in the intimate
apparel field, where she most recently served
as vice president of new business at Vanity Fair
Intimates.
“My purpose is to update everybody here with
the latest news,” Hebert said.
The big news was in regards to the Interfilière
textiles fair, which traditionally is staged in conjunction with the Lyon fair in September and the
Paris show in February. But this time, Eurovet has
decided to introduce a one-day Interfilière preview
in Paris on June 26 intended to give exhibitors a
jump-start on trends before Lyon kicks off. It will
be staged at the Palais des Congrès/Porte Maillot.
Meanwhile, Hebert noted that the second edition of the Shanghai show was a success, with
Gillian Kirby, U.S. agent for Eurovet,
4,123 visitors. Fifty-four percent came to source
and Anne-Manuele Hebert, Eurovet’s
fabrics, 34 percent were scouting for brands to disinternational department manager.
tribute and 12 percent were on the hunt for new
production partners. Visitors from the international marketplace included Triumph, Toyoba, Toray and Wacoal from Japan; Etam,
Huit, Empreinte, Lejaby and Lise Charmel of France; Schiesser and Naturana from
Germany; Delta Galil and Lee Copper of Israel; Wild Orchid of Russia, and several big
names from the U.S. — Fruit of the Loom, VF Intimates, Dow, Saramax and Victoria’s
Secret. The Chinese contingent included a melting pot of international companies,
among them Hanesbrands, Maidenform, Mast, Esprit and Adidas.
“China and its consumers represent an annual 2 billion euro [approximately $2.6
billion at current exchange] business for lingerie, and the demand and consumption
is growing by 15 to 20 percent in certain areas,” Hebert said.
As a result of the positive reaction, Hebert said a bigger, more prestigious
Shanghai, Mode Lingerie venue is planned for next October and an additional linge-
PHOTOS BY STEVE EICHNER
By Karyn Monget
WWD, MONDAY, NOVEMBER 27, 2006 9
WWD.COM
Accessories Report
Mulberry Blooms With Stateside Stores Retail Jewels for Buccellati
By Sophia Chabbott
NEW YORK — Mulberry has branched
out, opening its first U.S. boutique in Manhattan, and more are on the way.
The British luxury leather goods firm,
with a track record of producing musthave bags and for accessorizing style
icons like Kate Moss, Sienna Miller and
Scarlett Johansson, has opened at 387
Bleecker Street. More stores are expected to follow next month, including a flagship at 605 Madison Avenue, and units in
the Americana mall in Manhasset, N.Y.,
and on Melrose Place in Los Angeles. A
fifth location, at the Pier Shops at Caesars
in Atlantic City, is expected in February.
“Over the 35 years that we have been
The interior of the Bleecker
in business, this has been a very U.K.-foStreet Mulberry store.
cused brand, and now we are opening it
up internationally,” said Lisa Montague,
chief executive officer. “The U.S. represents a huge opportunity within
that international expansion because the demand for luxury goods
here is significant. If we get it right and appeal to our consumer base, it could give us a fantastic opportunity to increase our business overall.”
Mulberry, which was founded in England in 1971 by accessories buyer Roger Saul, has had an extensive rebranding effort under way since 2000. That’s when Singapore
fashion and hotel entrepreneurs Christina Ong and husband
Ong Beng Seng invested $14.5 million in the company.
In 2002, Saul sold his stake in the firm. Two years later,
Mulberry hired design director Stuart Vevers, who worked
closely with Mark Jacobs when Vevers was a design consultant for LVMH Moët Hennessy Louis Vuitton. Also during that time, Mulberry began its retail rollout, adding five
new stores in the U.K. to its 10 boutiques in cities such as
London and Paris, and in the Netherlands.
Here and above:
Retail expansion into Hong Kong, Japan and northern
Mulberry’s spring
European countries followed. In the last 12 months,
handbags.
Mulberry has opened five standalone stores, including locations in Terminal 4 at London’s Heathrow
airport and in Edinburgh, as well as in Norway,
Thailand and Taiwan, bringing Mulberry’s total number
of doors to 24 worldwide.
Mulberry began targeting U.S. business two years
A Mulberry
ago through wholesale distribution. It launched its first key ring.
collection of bags here in Bergdorf Goodman, and also
distributed its assortment in Barneys New York, Neiman Marcus, Saks
Fifth Avenue and Nordstrom. At the time, Montague told WWD that she
estimated first-year sales here at $1 million, but had hopes to boost that
to $50 million in the next five years.
Montague declined to give updated sales projections, but said she would like to see the U.S. market generate 30 percent of Mulberry’s business in the future, and business from Europe and Asia
split the other two-thirds. Mulberry now generates 90 percent of its business in the U.K. and northern
Europe.
“We wanted to test the U.S. market through wholesale before opening up retail locations here because it is such an important market,” Montague said. “Fortunately, we had great success and it’s given
us the confidence to move ahead. I think it will be a great balance to have our department and retail
store business here. The customer wants a personal relationship with the brand, which is difficult to
achieve in a department store. It will also give us the opportunity to offer the whole brand experience,
which may include bringing our apparel to the States.”
Montague said the new stores adhere to an interior design concept modeled on Mulberry’s Bond
Street location in London, but each space is created to have its own character and merchandised with
a mix suited to its environment.
“The Bleecker Street store is very much targeted to a cool downtown girl — it’s very Kate Moss,” she
said. “But with Madison Avenue, we need to consider different customer groups. All the stores will still
have the Mulberry brand aesthetic, but we recognize that there are unique needs in different markets.”
The Bleecker Street space, which Montague calls a jewel-box location at 530 square feet, is retailing
women’s and men’s merchandise, including handbags, luggage, small leather goods, gloves, scarves and
items like notebooks and organizers. Prices range between $59 and $2,995, and bespoke items top out
at $9,000.
The new Madison Avenue store is expected to be 3,000 square feet. To celebrate both New York openings, Mulberry is throwing a party on Wednesday at 5 Ninth in the Meatpacking District.
Buccellati’s low profile is about to rise a bit.
The 300-year-old, family-owned
Buccellati
fine jewelry brand is to open
watches.
two boutiques, in Aspen, Colo.,
and in London, in time for the
holidays, and renovated stores
in New York and Beverly Hills
are to be launched next week.
Despite the growth, the brand is
intent on limiting distribution.
“Buccellati isn’t for everybody,” company president
Andrea Buccellati said during an interview at the company’s temporary Manhattan boutique in the St. Regis Hotel. “Our
clients are looking for luxury and
exclusivity. They want to be part of an inner circle. We’re looking to make the Buccellati experience more tailor-made.”
The stores will reflect the firm’s ornate Italian Renaissance
aesthetic, with modern touches such as improved lighting and
contemporary materials like lacquer. The company also wants
the new boutiques to be a destination
for social events, arts and entertainment, particularly at the 900-squarefoot Aspen store.
Buccellati, which became a brand
in 1919 under the leadership of
Andrea Buccellati’s grandfather, is
known for its engraved brushed gold
and platinum jewelry embedded with
fine stones, including rubies, emeralds, diamonds and sapphires, designed by the firm’s president and his
father. Only 3,000 to 4,000 pieces of
jewelry are made in Milan each year
Andrea
and prices range from $1,000 to well
Buccellati
into the millions for custom pieces the
firm creates for its best clients.
In 2000, the firm launched its first watch collection — average price $15,000 — and began a U.S. wholesale operation
that now includes distribution in 25 doors such as Bergdorf
Goodman, Wynn Hotel in Las Vegas and Neiman Marcus stores
in Dallas, Chicago and Miami.
Sterling silver hollowware accounts for 30 percent of the
business, with its candlesticks and compotes in addition to
objet d’art, which are sold in 100 doors.
The firm is not planning to increase its wholesale network,
but it might open a store in Palm Beach, Fla.
“It’s not about a big flashy store — we don’t want that,”
Buccellati said. “We want to be able to have a direct connection [with the consumer]. We can sketch pieces together for a
customer, or a customer can bring in a stone and we can set it
in the Buccellati way.”
Andy Frankl, president and chief executive officer of IBEX
Construction, which worked on the Manhattan flagship on East
57th Street, said, “It’s a refreshment of
their space,” adding that an elaborate
wood ceiling will be restored, and
the exterior will get a new enamel
face and hand-rubbed bronze finOne of the
ish harking back to the compabrand’s
ny’s Milanese pedigree.
signature
In addition, the firm is reincollars.
venting and sourcing vintage
pieces its customers have requested. The sale of an estate
gold, diamond and ruby bracelet
by the firm at a recent Christie’s
jewelry auction in New York
caused a bidding war.
PORTS 1961 PHOTO BY THOMAS IANNACCONE;
ANISTON AND ROMIJN BY KEVIN MAZUR/WIREIMAGE
FINDINGS
Ports 1961
Jetset Kit.
PACK RAT: Ports 1961 creative director Tia Cibani
wants her clients to travel well. So, starting this
month, for $4,500, consumers can get a carry-on
bag filled with all of Cibani’s favorite travel items.
Inside the canvas and leather bag is a leather journal,
candle, brown alpaca scarf, eye mask and knit teddy
bear.
“I feel like I was born with the travel bug,” Cibani
said. “I love the entire experience of traveling, from
the downtime on long flights to the interesting people
I see and meet at airports. The most thrilling part is
embarking on a trip to a place I’ve never been before.
It always gives me butterflies.”
The Jetset Kit will be available on Ports’ Web site,
and 5 percent of all sales from Dec. 1 to Jan. 1 will go
to Free Arts NYC, a nonprofit organization dedicated
to bringing the healing powers of the arts into the lives
of abused, neglected and at-risk children and their
families.
PORTRAIT BY KYLE ERICKSEN
PHOTO BY JOHN AQUINO
By Jennifer Hirshlag
GOING PLATINUM: Swiss luxury watchmaker Vacheron
Constantin launched its platinum collection in the
U.S. this month with a small cocktail party in Los
Angeles hosted by Jennifer Aniston, Courtney Cox,
David Arquette, Catherine Keener and entertainment
mogul Bernie Brillstein.
“Platinum is elite, rare and difficult to work with,
so we thought Hollywood was the ideal place to launch
this product,” said Vacheron president Julien Tornare.
The company produced fewer than 1,000 platinum
timepieces to be sold in watch stores such as
Tourneau worldwide, at retail prices from $26,000 to
$500,000.
The Hollywood elite have become the target
audience of choice for lavish American launches such
as Chanel’s Les Perles collection, but not without a
cause: Vacheron’s event benefited the Epidermolysis
Bullosa Medical Research Foundation, seeking to cure
the rare skin disorder that affects children.
Jennifer Aniston and
Rebecca Romijn
10 WWD, MONDAY, NOVEMBER 27, 2006
Weekly Stocks
Financial
Accessories, Intimates: Future of A&F?
By Jeanine Poggi
F
or its next act, Abercrombie &
Fitch will likely stick to what
it knows best — the teen and contemporary market, according to
analysts and financial sources.
While the company has been
tight-lipped about what’s in
store for its next concept, analysts are betting that it will be
the launch of an accessories or
intimates brand. “I have heard
[speculation] that Abercrombie
& Fitch has hired away some talent from Victoria’s Secret,” said
Kimberly Greenberger, specialty
retail analyst at Citigroup.
The apparel retailer has already done well with intimates
and dormwear at Abercrombie &
Fitch stores, especially around
the holidays. With competing
teen retailer American Eagle
profiting from its new intimates
subbrand aerie, and the possibility of the company extending
the line into its own concept,
Abercrombie might be looking
to get a piece of the action.
“While there is already a
market share in this division,
with Victoria’s Secret Pink and
American Eagle’s aerie, it is a repeat customer who is always buying underwear,” said Christine
Chen, senior research analyst at
Pacific Growth Equities.
Abercrombie & Fitch’s intimate brand would likely be less
feminine than aerie and Pink,
especially since chairman and
chief executive officer Michael
Jeffries is very protective of the
masculine heritage of the brand,
Greenberger said.
Abercrombie has had extremely successful launches in
the past, most prominently with
the teen line Hollister. But Wall
Street is becoming more speculative about the ability of retailers to penetrate the intimate apparel business.
“I’ve seen many great retailers have mediocre success in
breaking into the bra business. It
is the most difficult new concept
to launch with the lowest success
rate,” Greenberger said. “But I’d
be more than willing to bet on
[Abercrombie to succeed].”
Although it seems an intimates
concept is likely, in a third-quarter conference call to Wall Street
the company said there’s money
to be made in accessories. “The
accessory business offers us a
huge potential — huge, huge,
huge. And I’m just a jerk that I’ve
not been able to build more volume in the past, but I’m really on
O
scar de la Renta filed a trademark infringement lawsuit against Richard Ginori 1735
S.P.A. and Richard Ginori 1735 Inc. According
to court documents, Oscar de la Renta alleged
that Richard Ginori continued to sell Oscar by
Oscar de la Renta branded items after a licensing agreement with the company was terminated. Ginori previously had a licensing agreement
to produce dinnerware, glassware, flatware
and giftware for the luxury design company.
The lawsuit also included claims for breach of
contract and federal and state unfair competition. Oscar de la Renta asked for preliminary
and permanent injunctions against Ginori. The
complaint asked for
approximately $5.1 million in damages. Ginori
could not be reached
for comment.
LeSportsac
Inc.
and Brand Science
filed a lawsuit for alleged trademark infringement and counterfeiting against Dali International Trading Inc. in
Manhattan federal court. According to court
documents, LeSportsac alleged that Dali sold
bags that were confusingly similar to its Ellipse
and Repeating Ellipse designs. The company also
alleged that Dali used other design patterns, for
which it holds trademarks. LeSportsac asked the
court for preliminary and permanent injunctions
against the defendant and for unspecified damages. Dali International Trading could not be
reached for comment by press time.
Paul Gottlieb & Co. sued Peep and Hot Topic
for alleged copyright infringement in Manhattan
federal court. According to court documents, Peep
manufactured a fabric that infringed on Paul
Gottlieb’s cupcake fabric design and made apparel, which it sold to Hot Topic. The lawsuit also
WWDComposite Index
Composite
1014.81
7
that track now,” Jeffries said.
The company sells leather
products at all of its divisions,
but has extended its offerings of
handbags at the retailer’s Ruehl
store, which targets the 30-yearold shopper.
So while it’s hazy what exactly the new concept will be, one
thing is clear: The company will
not tread into Baby Boomer territory. “I have to say I don’t think
it’s in our DNA to really do business with mature people,” said
Jeffries on the call.
“We also know that given the
company’s history with advocacy
groups and the raciness of the
current brand, a baby concept
seems unlikely,” said Thomas
Filandro, retail analyst at
Susquehanna Financial Group,
in a research note.
Abercrombie & Fitch has
been investing more money into
its next concept this year than
they have in the past, causing
analysts to believe an announcement of their plans may come
sometime in 2007, with store
rollout not until late 2008.
Investing on the new, unnamed concept was included in
recent capital expenditures of
$50 million, the company said
on the call.
alleges unfair competition. Paul Gottlieb asked
for a preliminary injunction and for statutory
and punitive damages of at least $750,000 plus
the cost of the lawsuit. Peep did not return calls
seeking comment. Chris Kearns, an attorney with
Hot Topic, said that Peep indicated there was no
copyright violation and had engaged in talks with
Paul Gottlieb to resolve any issues.
A judge in a Los Angeles federal court dismissed a lawsuit filed by Oakley Inc. against
Cartier International B.V. in favor of a case filed
in the Southern District of New York by Cartier
against Oakley. The dispute arose over Cartier’s
belief that Oakley’s Time Tank watch infringed
on its own Tank trademark for watches and
jewelr y. According
to court documents,
Oakley filed an action
for declaratory judgment of non-infringement in Los Angeles in
July. Cartier filed its trademark infringement action in Manhattan in August.
Cartier International B.V. won a permanent injunction against Geneva Quartz Watch
Manufactory Inc., Geneva Quartz Inc., Royal Watch
and other named defendants for alleged infringement of its Tank Francaise trademark. According
to court documents, the parties reached a settlement agreement and both parties will pay their
own litigation costs for the action.
Phillips-Van Heusen filed a breach of contract
lawsuit against P.Y.A. Importer Ltd. for allegedly
failing to honor the financial terms of a licensing agreement. PVH asked the court to award it
close to $1 million, plus other damages deemed
appropriate, according to court documents. P.Y.A.
did not return calls for comment.
— Liza Casabona
Weekly % Changes Ending Nov. 24
Gainers
J. Crew
Brown Shoe
Tag-It
Payless Shoes
Claire’s Stores
Close Change
43.28 30.36
46.46 17.06
1.29 14.16
31.81 13.32
32.87 11.35
Decliners
Close Change
Blue
1.91 -10.75
House of Taylor 2.38 -10.70
Crocs
42.45
-8.69
Coldwater Creek 28.06
-7.24
Maidenform
19.26
-6.50
COMPILED BY DATA NETWORK, HUNTINGTON, N.Y., 631-549-1014. NOTE: INFORMATION AND DATA, THOUGH BELIEVED ACCURATE, IS NOT GUARANTEED. DATA NETWORK SHALL
NOT BE LIABLE FOR ANY INACCURACIES.
52-WEEK
HIGH
LOW
79.42
49.98
27.13
19.41
33.01
21.07
22.25
17.01
3.19
1.88
49.51
19.45
45.15
29.59
10.45
6.17
33.94
26.16
23.03
9.02
26.86
13.05
40.00
21.41
16.50
6.84
7.85
5.70
33.07
25.18
46.44
23.73
6.80
1.62
1.59
0.68
38.60
17.71
47.16
26.37
45.35
31.75
24.72
15.00
35.24
21.08
15.10
5.86
26.70
19.35
44.30
35.80
12.74
7.80
26.29
8.07
29.60
15.28
15.57
9.69
49.63
27.99
45.12
33.65
49.40
17.26
71.81
41.81
31.25
15.00
45.40
34.57
57.85
26.78
36.73
23.88
42.75
25.18
31.26
18.69
67.08
53.41
61.37
42.85
44.99
17.61
57.94
46.00
9.45
6.44
50.25
20.32
6.75
4.24
13.48
9.02
5.25
1.85
32.46
21.34
56.36
20.59
11.55
6.61
20.50
14.60
10.58
5.92
65.13
44.96
36.47
20.36
19.84
12.10
28.09
14.08
37.39
23.50
42.06
20.02
23.50
6.88
24.58
13.63
43.60
32.71
20.63
6.56
30.91
21.57
45.01
31.76
19.29
9.55
26.16
24.55
23.84
15.89
17.70
11.33
42.95
31.12
19.98
9.80
21.39
15.91
56.00
41.92
43.72
25.50
17.89
6.33
55.79
37.06
29.10
23.08
11.08
6.29
65.98
32.94
49.11
19.97
152.00
69.11
24.90
11.76
24.65
17.75
9.97
5.50
25.29
15.80
16.30
9.43
7.50
0.95
35.58
23.54
19.18
9.00
1.41
0.37
21.77
15.10
40.90
24.00
82.49
51.80
9.29
7.15
36.10
27.30
48.12
22.14
34.57
22.83
29.60
21.75
67.67
56.59
46.74
30.30
75.54
42.78
37.81
22.54
13.98
9.51
18.86
11.37
32.60
21.62
21.50
8.66
43.30
33.40
4.89
2.69
31.45
24.17
86.92
66.44
22.84
8.49
41.75
28.75
26.10
15.20
57.65
9.72
27.29
17.60
1.20
0.50
23.54
18.81
28.93
22.80
22.63
9.41
97.04
75.52
9.19
1.53
50.79
31.77
19.03
14.18
8.97
1.50
6.00
3.62
11.55
6.47
57.58
34.34
27.78
13.12
19.24
4.43
22.67
17.00
32.52
20.36
40.48
18.50
51.38
30.55
6.39
3.00
15.49
9.30
77.42
45.65
17.91
7.55
3.00
1.06
15.06
11.60
37.51
25.81
77.19
57.30
18.00
11.60
3.95
0.76
26.70
9.73
31.80
22.12
21.45
14.10
182.38
113.92
29.24
19.25
11.00
5.19
103.54
76.14
31.40
14.26
6.16
3.68
20.37
11.27
4.00
2.83
44.70
17.63
16.21
11.90
13.40
9.95
21.24
14.02
1.38
0.32
31.00
17.30
12.30
9.27
8.32
4.80
39.64
27.33
60.34
44.70
2.20
1.02
49.14
33.82
13.73
7.54
43.80
29.63
37.61
24.80
29.84
21.47
24.36
12.85
44.09
25.75
49.99
21.08
3.76
2.00
40.48
28.65
20.78
9.43
33.61
13.65
78.57
53.25
41.40
18.24
52.15
42.31
28.22
15.75
13.45
10.60
47.55
36.77
25.72
18.76
4.75
2.03
30.20
20.26
31.72
21.01
38.85
18.66
RETAILERS
Abercrombie & Fitch
Acadia
Aeropostale
Alberto Culver
Alpha Pro Tech
American Eagle Outfitters
Ann Taylor
Ashworth
Avon
Bakers
Bebe
Benetton
Big Dog
Birks & Mayors
BJs
Blair
Blue
Bluefly
Bon-Ton
Brown Shoe
Buckle
Cache
Carter
Casual Male
Cato
CBL
CCA
Charles & Colvard
Charlotte Russe
Charming Shoppes
Chattem
Cherokee
Chico’s
Children’s Place
Christopher & Banks
Cintas
Citi Trends
Claire’s Stores
Coach
Coldwater Creek
Colgate Palmolive
Columbia Sportswear
Conns
Costco
Cost U Less
Crocs
Culp
Cutter & Buck
Cygne Designs
Deb Shops
Deckers Outdoor
Delia’s
Delta Apparel
Delta Galil
Developers Diversified
Dillard’s
Dollar General
Dress Barn
DSW
Duckwall-Alco
Eddie Bauer
Elizabeth Arden
Estee Lauder
Everlast Worldwide
Family Dollar
Federated Department Stores
Finish Line
Forest City
Fossil
Freds
G&K
Gaiam
Gap
General Growth
Genesco
G-III Apparel
Gildan Activewear
Glimcher
Gottschalks
Guess
Gymboree
Hallwood
Hampshire
Hanesbrands
Hartmarx
Helen of Troy
Hot Topic
House of Taylor Jewelry
IAC Interactive
Iconix
Innovo
Inter Parfums
J. Crew
J.C. Penney
Jaclyn
Jones Apparel
Jos. A Bank
Kellwood
Kenneth Cole
Kimberly Clark
Kimco Realty
Kohls
K-Swiss
LaCrosse Footwear
Lakeland Inds
Limited Brands
Liquidity Services
Liz Claiborne
LJ Intl
Luxottica
Macerich
Maidenform
Mens Wearhouse
Marcus
Mothers Work
Movado
Movie Star
National Retail Properties
New Plan Excel Realty
New York & Co.
Nike
Nitches
Nordstrom
Oakley
Oralabs
Orange 21
Orchids Paper
Oxford
Pacific Sunwear
Parlux Fragrances
Paxar
Payless Shoes
Perry Ellis
Phillips-Van Heusen
Phoenix Footwear
Playtex
Polo Ralph Lauren
PriceSmart
Quaker Fabric
Quiksilver
Ramco-Gershenson
Regency Centers
Retail Ventures
Revlon
Rocky Brands
Ross Stores
Saks
Sears
Shoe Carnival
Shoe Pavilion
Simon Properties
Skechers
Sport-Haley
Stein Mart
Stephan
Steve Madden
Stride Rite
Superior Uniform
Syms
Tag-It
Talbots
Tandy Brands
Tandy Leather Factory
Tanger Factory Outlet
Target
Tarrant Apparel
Taubman
Tefron
Tiffany & Co.
Timberland
TJ Maxx
True Religion
Tween Brands
Under Armour
Unifi
Unifirst
United Retail
Urban Outfitters
V. F. Corp.
Volcom
Wal-Mart
Warnaco
Wellco
Weingarten
Weyco
Wilsons
Wolverine
Zale
Zumiez
WWD.COM
P/E
16.1
45.7
19.3
20.0
20.6
16.9
33.8
31.3
26.0
25.8
47.3
89.3
9.5
19.3
13.7
15.0
347.9
19.6
16.3
32.5
21.3
28.4
15.3
37.3
13.2
25.6
17.8
17.0
22.4
20.8
21.1
25.8
20.9
21.2
29.9
18.5
30.7
47.3
26.8
18.5
13.9
22.9
11.5
32.4
17.6
15.5
22.0
71.1
12.1
39.6
15.3
17.2
17.1
28.0
23.7
17.3
27.5
14.6
22.3
23.4
15.1
31.9
22.9
17.7
20.8
92.6
18.2
263.5
14.1
77.5
27.8
101.7
42.3
27.2
24.5
4.9
11.0
17.9
15.8
37.3
36.5
19.2
26.3
17.1
12.4
21.2
14.8
32.3
18.3
21.8
31.1
24.3
15.2
12.1
13.3
16.6
17.0
19.3
28.3
134.8
18.3
16.0
32.1
29.9
21.1
23.1
30.4
17.9
18.7
308.6
21.0
27.6
21.0
288.3
18.0
18.6
23.9
19.4
22.1
18.0
18.9
10.5
83.1
21.8
56.5
28.6
69.2
43.3
9.8
19.6
28.7
20.8
16.7
30.3
58.7
19.3
17.6
37.6
17.3
19.1
38.8
35.2
26.0
19.2
96.4
19.5
41.8
18.1
21.3
17.9
15.9
15.1
21.6
71.2
17.6
6.9
31.6
15.4
28.1
17.2
23.5
14.2
26.9
14.2
19.6
29.9
46.3
VOLUME
(000’S)
59703
10767
46954
92632
1668
73799
120361
840
70159
188
31575
320
130
10
66069
409
1473
2240
4996
17230
1585
4774
11847
12020
5987
14430
833
3093
20519
27333
18301
605
128201
10983
18254
23125
5175
121667
102145
153046
83299
9357
1699
88509
169
129863
347
409
229
349
5790
3217
98
88
23086
38855
184409
15055
9172
147
2321
11794
47992
316
35469
149250
10992
31
7307
19394
2070
5194
239908
83358
15413
981
5809
4231
3506
20439
36741
9
207
17609
2990
3739
27331
2949
174978
7711
3178
1026
62968
61282
53
19446
6606
8242
3228
46077
40004
87946
9631
231
408
79754
8108
12008
4678
2617
20238
9978
25980
2345
25499
2130
1389
14363
21737
14899
34396
542
133373
7010
5409
611
15
2131
52430
23965
4575
83232
7946
40872
362
10958
24859
766
1133
29590
3099
11360
7414
93478
596
30771
104193
84090
3570
329
52158
8705
102
10223
156
10253
4045
91
415
9990
20996
315
1858
7086
106703
3016
20989
1289
29188
13745
116527
7440
14272
21289
4946
1368
9300
88402
14861
5492
369895
11280
5
21468
89
1588
10072
14308
10612
AMT
LAST
70.51
26.68
29.83
20.71
2.41
47.54
34.89
7.03
33.28
13.00
22.73
35.70
16.08
7.24
32.40
30.92
1.91
0.94
34.98
46.46
44.91
24.18
28.23
14.10
24.94
42.97
11.70
8.18
29.45
14.33
49.60
43.45
23.54
67.53
21.75
42.41
43.12
32.87
42.78
28.06
65.97
60.55
25.33
53.51
8.44
42.45
5.12
9.78
2.90
25.55
54.41
9.16
18.37
10.24
64.85
35.81
16.30
21.90
33.90
39.86
9.20
18.83
41.82
16.23
28.43
43.11
13.88
25.52
21.58
11.90
39.71
13.89
19.30
52.65
38.69
17.00
54.96
26.60
10.99
63.65
42.82
91.05
16.40
24.45
7.02
24.44
13.05
2.38
35.51
16.13
0.67
20.99
43.28
80.81
9.28
33.73
30.75
30.70
23.96
66.29
46.36
71.05
34.64
12.05
14.00
31.38
19.69
42.63
4.40
30.73
86.72
19.26
38.56
25.56
47.10
25.92
1.17
23.40
28.17
14.17
96.73
6.21
50.00
18.94
5.42
4.68
8.65
51.65
19.48
6.78
22.01
31.81
37.82
49.72
4.21
14.97
77.21
16.77
1.11
14.58
37.31
77.77
17.38
1.67
13.61
29.97
20.33
176.45
26.78
7.69
101.92
29.20
4.04
15.18
3.50
36.18
15.84
13.26
19.10
1.29
25.22
11.99
8.08
39.92
57.71
1.32
49.10
11.00
37.32
32.12
28.20
15.38
41.62
47.60
2.44
39.44
15.31
22.22
76.38
32.52
47.90
25.36
11.50
47.83
24.70
2.42
28.40
30.58
28.04
CHANGE
-0.58
1.18
1.34
-0.72
0.07
0.21
-1.68
-0.07
-0.39
-0.14
-0.77
0.06
-0.15
-0.01
2.79
0.67
-0.23
-0.04
1.19
6.77
-0.05
0.14
-0.11
0.60
0.27
1.97
-0.03
-0.06
1.01
0.22
3.20
0.06
-0.91
1.24
-0.71
-1.06
-1.58
3.35
0.74
-2.19
-0.04
1.60
0.90
0.11
0.14
-4.04
-0.16
-0.54
0.05
-0.98
-0.13
-0.44
-0.08
-0.10
2.96
0.01
1.13
0.10
-0.35
-1.30
-0.04
0.40
0.78
-0.55
-0.02
0.54
-0.47
-0.13
-0.63
-0.53
0.02
-0.01
-0.51
4.31
2.15
0.12
0.79
1.00
0.01
1.21
-1.50
2.03
1.41
0.45
-0.23
-0.49
0.31
-0.28
1.67
0.13
-0.02
-0.01
10.08
0.71
0.17
-0.02
-0.39
0.58
0.20
-0.23
2.21
-2.22
-1.10
-0.59
-0.55
0.58
0.55
0.08
0.10
-0.64
5.92
-1.34
0.08
0.11
0.25
-0.17
0.04
0.61
0.86
-0.03
1.15
-0.18
1.92
0.54
0.24
0.11
0.00
-0.35
0.56
0.40
-0.07
3.74
0.66
2.48
0.26
0.17
0.95
-0.75
-0.04
0.32
0.94
5.32
0.36
0.08
-0.20
-0.44
0.12
3.47
-1.64
0.11
6.47
0.15
0.01
-0.40
0.13
-1.02
-0.13
-0.03
0.07
0.16
0.04
0.19
0.33
1.90
-0.51
0.02
3.00
0.15
0.78
0.19
-1.04
-0.02
-0.16
1.05
-0.01
-0.51
-0.92
-0.17
-0.99
-0.12
0.40
0.05
-0.10
2.65
-0.47
-0.07
0.48
0.59
-0.06
WWD, MONDAY, NOVEMBER 27, 2006 11
WWD.COM
Fashion Scoops
ALL EYES ON PARIS: Miuccia Prada’s affinity for Paris isn’t restricted to Miu Miu’s
women’s collection. The designer has dropped the fall runway show for Miu
Miu’s men’s line during Milan Fashion Week in January in favor of a showroom
presentation. A spokesman confirmed a small portion of the clothes would then
be included in the brand’s women’s show, which will be held in Paris in March.
MOSS MAKE-UP: Her clothing line with Topshop may not hit stores until
April, but according to press reports in Britain, Kate Moss is already
thinking about branching out into beauty. London’s Daily Mirror reported
Friday that Moss plans to launch a cosmetics and skin care line, adding
that she is in talks with several cosmetics companies. Her spokesman told
WWD the reports were “incorrect,” but he did not rule out the prospect of
a beauty line after Moss’ modeling contract with Rimmel expires in about
a year. Moss has been signed to Rimmel since 2001, and the brand was
one of the few companies to continue its contract with the model when
news of her allegedly taking cocaine broke last year.
Two views of Paul Smith’s
new Paris store.
Paul Smith’s Touch of Whimsy in Paris
By Robert Murphy
PARIS — Anyone who has followed Sir Paul
Smith’s recent retail openings — including a furniture and curiosity shop on London’s Albemarle
Street — knows the British designer isn’t one for
cookie-cutter rollouts.
His newest shop here, at 3 Rue Faubourg SaintHonoré, underscores his idiosyncratic approach,
offering ceramic figurines and vintage toys alongside his own men’s and women’s designs. The
3,000-square-foot, two-level shop is Smith’s first
on Paris’ Right Bank (he opened on the Left Bank
years ago), and is in close quarters with Gucci,
Hermès, Chanel and Lanvin stores.
In that luxury environment, his space looks
more whimsical than the competition. “It is [my]
first shop in an obviously fashion street for fashion
brands,” Smith said.
“The location is fantastic,” the designer continued, adding that he was attracted by the series of
rooms (eight in total) that the space afforded. “It
suits my idea of individuality, allowing me to design each space with its own character.”
On the ground floor, for instance, shoppers find
glass cases brimming with curios (all for sale) and
Smith-designed accessories. A sweeping staircase
to the second level is hung with scores of pictures
and photographs, from kitsch views of Paris to a
photo of an English aristocrat asleep on his sofa.
“My passion is individuality,” Smith said. “I
strive to make each of my stores special. I hate
the idea of ‘the corporate rollout,’ where all of the
shops look more or less the same, destroying important streets around the world, making them look
all the same and losing the character of the city.”
Underscoring the building’s 19th-century
Haussmannian provenance, Smith said he opted
to return the facade to its original state.
“After that, the idea was to add my ideas to each
room. For instance, one room is very feminine with
a boudoir feeling, another is covered in English
coins, creating a masculine mood,” he said.
MACDONALD’S MOMENT: Julien Macdonald, known for his opulent furs and
glittery spiderweb knits, was in his element when he collected his Order
of the British Empire honor, which was presented by Queen Elizabeth II at
Buckingham Palace last Thursday. “I felt like I was walking into a medieval
film,” said Macdonald, who added the Queen was keen to talk fashion, and
even asked him about his time at Givenchy. “She said she loved Hubert
de Givenchy’s work, especially [Audrey Hepburn’s] dress in ‘Breakfast at
Tiffany’s,’” said Macdonald. Later, the Welsh designer Macdonald rounded
off his very British experience by taking a cruise along the Thames with his
parents and sister. “I wore my medal all day,” he added.
FAMILY TIES: While known primarily for his cocktail dresses, Alber Elbaz
also knows his way around a jacket — even the kind for books. The Lanvin
designer was tapped to illustrate the cover of the 2007 “Bottin Mondain,” a
guide to aristocratic families and hip socialites in France. More than 44,000
families are listed, including the cell phone numbers and e-mail addresses
of some of the youngsters. Elbaz sketched one big happy family of cheerful
faces, portraying the trendy image the century-old guide wants to convey.
CHEAP BUT CHIC: Now that fast-fashion chains are tapping big-name
designers, why not star architects as well? French architect Jean Nouvel,
whose works include the Cartier Foundation and Paris’ new primitive art
museum at the Quai Branly, is among the contenders to design H&M’s
new Champs-Elysées store, which is slated to open in 2008.
GALLIC GALLANT: Ralph Rucci just can’t get enough of Paris. Having first entered
couture in 2002 as a guest member of the Chambre Syndicale, the New York
designer has revealed he’ll be back in the City of Light come January. He plans
to present both his spring couture and fall-winter ready-to-wear collections, his
first tandem presentation in France. Rucci noted he’ll still show his rtw collection
during New York Fashion Week. “I’ll be showing in my studio with an old-world
approach; very quietly with no music,” he said. “It’s about experimenting.”
Although the men’s collection — the bulk of
Smith’s business — is highlighted in two rooms, the
women’s is housed in a single, pale pink room with a
corniced ceiling.
Smith’s shop is the latest addition to the
street, which has seen a raft of openings. Dolce &
Gabbana launched a men’s store, located next to
Smith’s, this year, and Hermès is in the midst of a
major expansion of its flagship. Down the street,
French sportswear brand Paule Ka just opened
and Cacharel christened a unit in the same retail
development that welcomed Tommy Hilfiger and
Brooks Brothers this fall.
As for Smith, he said the Paris location pointed
to more retail expansion. He just inaugurated a
shop in Red Square in Moscow, and early next year
he has plans to open a shop in Beirut. Smith said he
may be scoping more locations in the U.S., where he
just opened a second shop in Manhattan.
GINGER TALE: Alison Gingeras, who curated François Pinault’s first exhibition
at his Palazzo Grassi foundation in Venice earlier this year, is joining the
French titan full time. Last week, Pinault named Gingeras curator of his
contemporary art collection, meaning she will leave her functions as an
adjunct curator at the Guggenheim. She will curate an exhibition of new
works slated to open in May.
STYLE TRIBE: London designer team Basso & Brooke took something of a world
tour for their latest commission. The duo were tapped to design an outlandish
outfit inspired by each of the Dorchester Collection’s (formerly the Dorchester
Group) hotels — The Dorchester in London, The Beverly Hills Hotel, Le Meurice
and Hotel Plaza Athenée in Paris and Hotel Principe di Savoia in Milan.
“They took us over 2,000 hours to produce — they said we could do
whatever we wanted,” said Bruno Basso at the launch of the collection at
The Dorchester Monday night, showing off the trouser suit they designed
for the Principe, whose print and embroidery replicates the hotel’s
intricate ceiling. However, Basso admitted that his favorite was the pink
ruched creation they designed for the Beverley Hills Hotel, complete with
a red-carpet printed at the foot of its train. “I know it’s not how people in
L.A. dress, but we wanted to do a stereotype,” said Basso. After the pieces
have toured the group’s hotels, Basso said they were likely to be exhibited,
although it had not been confirmed where.
12 WWD, MONDAY, NOVEMBER 27, 2006
WWD.COM
Giles Deacon to Design Daks Women’s MEMO PAD
By Samantha Conti and Nina Jones
LONDON — Giles Deacon is adding another string
to his fashion bow, designing the luxury women’s
collection for British fashion and tailored clothing
brand Daks.
Deacon will show his first collection, for fall
2007, in Milan next February.
“I’ve loved their fabulous tailored pieces since I was at college,
Giles Deacon
and I loved the idea of working with
a true British luxury brand. And it
doesn’t hurt that they have royal
warrants,” Deacon told WWD. “I
want to transform it into an ultramodern British tailored clothing
collection. There will be a lot of
coats, jackets, suits — and I hope I
can pop a few frocks in there, too.”
Bruno Massa, managing director of Daks, said in a statement late
last week that Deacon “is one of the
most exciting designers working in
London today, and I am delighted
he is bringing his talent to Daks.”
Deacon said he wants the luxury collection, ultimately, to be globally attractive and not simply a
“pastiche” of British style. “I am so excited about
working for Daks. I’ve seen some of the fall prototypes — all made in Italy — and they are just
amazing,” he said.
Deacon will replace Tiziano Mazzilli and Louise
Michielsens, the founders of London fashion label
Voyage, who have designed the collection for the
past two years. His contract is for two years, and he
will be focusing exclusively on the high-end line,
which shows on the Milan runways. He said he’d
be working on bags and shoes as part of the line.
Daks’ most important markets are Europe and
the Far East. The line does not wholesale in the
U.S., although Deacon said he’d love to see it sell
there. “The U.S. would be a great place to push
into,” he said.
Asked whether he was stretching himself in too
many directions, the designer insisted otherwise.
Deacon already designs his signature collection,
Giles, which shows in London, and he is working with
British high street retailer New Look on a full clothing and accessories line that will bow for spring 2007.
“We’re very organized in the studio — it’s a bit of
a military operation and each of the lines we work
on is miles apart from the other, so I
don’t think there will be any confusion between them,” he said. “We
thought long and hard about taking
on Daks, and we knew we could dedicate a great team to it — like we do
with the other lines. Also, I enjoy hopping from one project to another.”
Although Daks’ roots are in
Britain, the company is owned by
the Japanese Sankyo Seiko Group,
which launched the luxury collection two years ago. Sankyo Seiko
tapped Mazzilli and Michielsens to
design that collection.
The luxury collection is currently
sold at Daks’ flagships in London and
Tokyo, but a spokeswoman for Daks said the distribution for the Deacon line was “under review.”
The spokeswoman added the collection designed
by Deacon was expected to achieve sales of between
4 million and 8 million euros, or $5.2 million to $10.5
million, in its first year. Prices for the line are likely
to be similar to the current luxury collection, which
includes cashmere knits at 600 pounds, or $1,160,
and wool jackets at 800 pounds, or $1,545.
She added the luxury collection makes up a
small proportion of Daks’ overall turnover, which
also includes a full ready-to-wear line at lower
price points. The company also introduced a
men’s luxury collection in June 2005, which is designed by Bruno Montgomery.
Daks’ retail sales for the 2005 fiscal year were
500 million pounds, or $966 million, the majority
of which were in Asia.
STYLE
STARTS
HERE.
CROWDING THE FIELD: Condé
Nast’s upcoming launch of a
business magazine, Portfolio,
in a crowded, dog-eat-dog field,
may have surprised some, but the
new magazine is not the only one seeking to reinvent the genre. James
K. Glassman, who has been a financial columnist for The Washington
Post and other publications, and who was the publisher of The Atlantic
Monthly and The New Republic in the Eighties, has relaunched the
public affairs journal of the American Enterprise Institute as The
American, a glossy bimonthly with a ambitious approach to business,
economics and culture. Even as business magazines trumpet their
impending Internet relevance, Glassman writes in his editor’s letter that
his new magazine will hark back to Henry Luce’s midcentury Fortune.
“I think the three major business magazines have, in an attempt to get
a broader audience, gone downscale,” Glassman contended, citing what
he saw as a “big opening” for an intellectual magazine about business
that is “absolutely not partisan or ideological — mainly a reported
magazine rather than a magazine of opinion.” As for Portfolio, “I would
be surprised if they’re doing something similar to what we’re doing....Our
attitude is that we think that business has been a source for progress and
good, and we believe in celebrating what business does well.”
The American’s debut issue includes a profile of CNN business
anchor Lou Dobbs and a feature on the transformation of Naples into a
men’s fashion hub.
It was released with 120 pages, 20 of which are advertising.
Advertisers include Intel, ExxonMobil and Cisco. The magazine will
have some limited newsstand distribution, some paid subscriptions
($40 a year to subscribe) and some controlled circulation, for an initial
circulation of 45,000. Alexander Isley, former art director for Spy,
designed the publication. — Irin Carmon
SIMPLY DONE: Real Simple has two more openings. Photo editor Naomi
Nista, who has been on maternity leave, will not return to her position at
the magazine, and senior photo editor Susan McClennan Phear will move on
in December to Vanity Fair. Three editors have left the Time Inc. magazine
since the beginning of November. Home director Michael Cannell, who
joined from the New York Times House and Home section, left three weeks
ago; food director Frances Boswell quit to become an acupuncturist and
food editor Renee Schettler left last week to join Martha Stewart Living as
deputy editor. And features editor Riza Cruz will leave the magazine Dec.
1 to become senior editor at Vogue. Real Simple will publish its first January
issue in 2007, bringing the number of annual issues to 12. It also publishes
Real Simple Family and Real Simple Travel specials. — Stephanie D. Smith
LONG ON JOHN: Anyone who has seen John Galliano stroll out at the end of
a fashion show, his bare chest glistening with oil, knows he is no shrinking
violet. Further proof — just shy of the Full Monty — can be witnessed in
the December issue of French Vogue the designer guest-edited, which hits
French newsstands this week. The 312-page issue has multiple covers
featuring Drew Barrymore with Galliano in silhouette. Inside, the designer
can be spotted at least 75 more times, including two nudes, his essentials
covered with a narrow swath of silk or via sly computer manipulation of a
Nick Knight photo. Asked in one Q&A which part of his body is his favorite,
Galliano replies: “My torso, which has been sculpted with exercise, and
my warrior arms to defend myself.” In one photo spread, model Sasha
Pivovarova masquerades as the designer, wielding huge scissors in the
Christian Dior atelier, or jogging beside the Seine trailed by bodyguards.
Besides Barrymore, Galliano tapped an array of his fabulous friends
for the issue, including Penelope Cruz, who submitted photographs she
took of the likes of Adrien Brody, Salma Hayek, Sean Penn and — you
guessed it — Galliano. The R-rated issue also comes polybagged with a
2007 calendar featuring eye-popping David Sims photos of model Karen
Elson in bondage. — Miles Socha
MONOCLE’S EDITOR: Monocle, the magazine to be launched early next
year by Wallpaper founder Tyler Brûlé, has an editor. Andrew Tuck, former
executive features editor at Britain’s Independent on Sunday newspaper,
joins Monocle’s creative director Richard Spencer Powell this month, and
will report to Brûlé. The magazine will feature a mix of global affairs,
culture and fashion. “There really is a gap in the market for this magazine,
and Tyler’s aspirations for it are incredible,” said a nonobjective Tuck.
The 10-times-a-year magazine, with a $10 cover price, is set to launch
with the March issue in mid-February. Monocle is expected to unveil its
remaining editorial staff later any day. — Samantha Conti
• 5 days a week Monday through Friday
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• WWDSCOOP (4 issues per year)
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Get all of this and so much more.
Subscribe to WWD today!
Simply call 1-800-289-0273 or 1-818-487-4526.
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*Buildings in NYC with delivery access only.
Leroux Exiting Eres
By Katya Foreman
PARIS — Irène Leroux, founder and creative director of the
Chanel-owned swimwear and lingerie firm Eres, said last week
she would exit the firm at the end of the year.
Leroux launched the line in 1968 at age 23, baptizing it Eres after
her parent’s multibrand store. Her successor as creative director is
Valérie Delafosse, currently a freelance designer for Princesse TamTam. Delafosse’s first collection for Eres will be spring 2008.
Leroux said she plans to pursue freelance design roles.
“It’s time to try out new adventures,” said Leroux, reminiscing
about the time she launched Eres’ first lingerie line in 1998. “I
remember nervously pushing a rail full of lingerie across Fifth
Avenue in the pouring rain to show to the Bergdorf Goodman
team,” she recalled. The retailer asked for an exclusive.
“The brand has reached a point where it needs to change dimension and Delafosse is the perfect person for the job,” said Leroux.
Eres operates nine stores in France and the U.S., a franchise
in Saint-Tropez and is sold in around 700 doors internationally.
A store is also scheduled to open in Madrid next spring.
SPECIAL ISSUE
WWDIntimates
PHOTO BY TALAYA CENTENO
Fashion Uncovered
WWDIntimates is the only fashion-driven intimate apparel publication reaching retail decision-makers
across all channels of distribution. Reporting the news, trends and retail strategies in the bra, panty,
shapewear, daywear, sleepwear, loungewear, at-homewear and legwear categories, WWDIntimates
offers a unique opportunity to presell your line ahead of market week.
Bonus Distribution: WWD’s exclusive intimate apparel specialty store network, Lingerie Americas.
Issue: January 29, 2007 Close: December 6, 2006
WWD Style Starts Here™
For more information on advertising in this special section, contact Joel L. Fertel,
associate publisher, at 212-630-4573, or Elizabeth Haynes, European fashion
director, at +33 1451 1303, or your WWD sales representative.
14
WWD, MONDAY, NOVEMBER 27, 2006
NATIONAL MARKETPL ACE
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online at: www.drexeljobs.com
Drexel is an EO/AA Employer
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Women’s and Men’s Apparel
and Accessories
CAD Artist $50-55K Current exp in
Primavision, Illustrator, Photoshop.
Strong in prints, cleaning up of prints.
Mdtwn sprtswr co. Call 973-564-9236
or E-mail: [email protected]
CAD ARTIST
Seeking Entry Level Cad artist with
knowledge of Illustr/Photoshop for a
fast growing Sportswear Company.
Email resumes to: [email protected]
Major Apparel company seeks very
organized and detail oriented individual
to work as liaison between design and
FULL TIME FREELANCE
production departments. Basic knowlTextile service studio is seeking expeedge of Photoshop & Illustrator required. rienced freelance CAD Designer. ProfiFax resumes to: 212-730-9705
ciency in Photoshop a must. Organized,
detail oriented, and able to multi-task.
Tel: 212-695-0115 / Fax: 212-695-0072
Admin
Since 1967
CAD Designer
W-I-N-S-T-O-N
APPAREL STAFFING
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Developer: The Bobker Group
Top Lingerie Building
PTTNS/SMPLS/PROD
Admin/Design Room Asst
NJ based supplier for major mass
merchant retailers needs exp’d,
dedicated individual for purchasing
activity kits. Must be able to maintain
detailed records, communicate &
negotiate pricing, deliveries, & terms,
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interface with product development
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Please send resume/salary req’s to:
[email protected]
DESIGN * SALES * MERCH
ADMIN * TECH * PRODUCTION
(212)557-5000
F: (212) 986-8437
ASSISTANT DESIGNER
Leading better separates co. looking for
organized, motivated, creative firecracker
willing to do whatever it takes. Must
have 2 yrs exp working with China,
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212-302-3872 / MRS. KRAMPF
BABY PHAT
Designer & Graphic Designers Needed
Infants through 16
Email: [email protected]
COLORIST
Great color sense needed. Rare oppty
to combine tech and creative skills.
Resp include: approve Labdip, strikeoff & bulk color submits for designer
lingerie co. Work with Design team to
CAD textile print colorways during
development cycle. Must be independent worker w/ good time mgmt skills.
3 yrs+ color exp’d. Ned Graphics
knowledge a +. Email resume & salary
req: [email protected]
DATA PROCESSING
Seeking motivated individual for entry
level data processing position using
AS400. We will provide training.
Please fax resumes to: 212-730-9705
Design Assistant
Branded women’s sportswear co seeks
detail oriented person with strong
organizational skills. You must have
knowledge of garment construction,
draw flat & detail sketches. Work on
presentation boards. Proficient in
Photoshop, Illust CS2 & create CAD’s.
Email resume to: [email protected]
Design
ASSISTANT DESIGNER
Major apparel co. seeks experienced
individual to create production/tech
packs. Other responsibilities include
helping prepare worksheets and artwork
pages. Must have knowledge of Illustrator & Photoshop.
FAX RESUMES TO : 212-730-9705
Design Assistant
Fast paced, high energy, growing
Women’s Apparel Co seeks:
Min of 3 years exp, must have strong
computer illustrator skills & MS
Office, be a self-starter, exp working in
a fast paced environment and able to
multi-task. Great oppty for growth and
excellent benefit package. Email / fax
resume: [email protected]
212 827 3344 Attn: MH
Designer $50-70K Current exp in private
label updated Jr. driven missy sportswear. Midtwn co. Call 973-564-9236 or
Email [email protected]
WWD, MONDAY, NOVEMBER 27, 2006
15
GRAPHIC DESIGNER
Intimate Apparel
Company based in NJ
Requires a strong sense of
design & creativity, meeting
multiple deadlines, & laying
out preliminary concepts as
directed by the design Mgr.
Strong background in Photoshop
& Illustrator, CAD & freehand
illustration is a must. Knowledge of lingerie & intimate
apparel illustration & detail
work is a must. Must be a team
player w/strong organizationa l
and technical skills, will be
required to prioritize and
multi task. Position requires
a minimum of 5 yrs exp.
HOT JOBS COOL COMPANY
Designer
*Designers, Licenses, Kids
$55k
*Sales-Home Accessories/bedding $100k
*Visual Mgr-Branded Retailor
$90k
*Costing Managers
$70k
*Inventory Planner
$80k
Danskin, Inc., well established active *Prod Asst
$45k
apparel co. is seeking an Assistant *Prod/Sourcing.Coord
Designer for licensed mass market *Bi-ling, Mand/Cant
$60k
brand to assist design staff in all phas- *Licensed Design Room Mgr.
$60k
es of product development; organize &
Call Laurie 212-947-3399 or
maintain trim, lab dip and fabric files;
e-mail: [email protected]
conduct flat sketching. Proficiency in
KARLYN FASHION RECRUITERS
Illustrator a must. Must have 1-3 years
experience, & be a responsible team
player, organized, detail oriented and
able to effectively multi-task.
Send resume with salary history to
[email protected] or
ACCESSORIES DESIGNER
Fax resumes to (212) 930 – 9103.
Private label company seeks Accessories
EOE/M/F/D/V
Designer to assist in handbags, as
well as communication with both the
buyer as well as the Hong Kong office.
Designer
Fax: (212) 869-3179 or
E-mail: [email protected]
Exciting and highly creative Fashion
School Supply Company based in
Long Island, NY is seeking an energetic, talented creative artist to join Sweater/Knits. Better Runway Designer
[email protected] 212-947-3400
our expanding creative department.
Career opportunity with the potential
to grow within successful company.
Must have Photoshop and Illustrator
experience on MAC. Competitive salary and benefits.
Brooklyn, NY
Please fax or email resume with salary Est’d. company seeks a Patternmaker
with 4+ years experience in Men’s
requirements to Mr. Lazo at:
Wear, to create and modify men’s
(631) 789-8989 or
outerwear apparel patterns from flat
[email protected]
sketches. PAD software knowledge a
plus. Must be computer savvy. Competitive salary + benefits. Friendly,
modern office. FT. Must speak fluent
Fast growing 7th ave. bridge evening co. English. Call 718-246-1515 or E-mail resumes to: [email protected]
seeks creative designer. Knowledge of Please visit: www.cryeassociates.com
fabric mkt. Ability to sketch, create
presentation boards, build design/tech
pacs for overseas production necessary.
Min 5 yrs exp. Full benefits pkg and 7th Ave Eveningwear Mfr. is seeking an
competitive salary. Email resumes to:
individual w/at least 5 years experience
in Patternmaking/Draping with [email protected]
porary, couture dresses. Must be exp.d.
dealing with China. Fax: 212-719-1064
Assistant Designer
Please email resume:
fashionopportunities@
gmail.com
Sales Reps With Following
Est’d. Upscale/Trendy Accessories Co. w/
Scarves, Shawls, Furs seeks Southeast &
Southwest Reps already participating in
Atlanta & Dallas Marts. Travel between
shows req’d. E-mail: [email protected]
SALES EXECUTIVES & SALES ASSISTANT
Well-known expanding Dress Company seeking
•SALES EXECUTIVES positions available for major dept. store
and private label. Must be assertive, highly motivated individuals
who can work as a team player. Minimum of 4 yrs experience
in the fashion industry and strong computer skills required.
Excellent opportunity for the right individual.
•SALES ASSITANT to assist president of sales. Must have
excellent communication skills, detail oriented, team-driven
and have strong computer skills. Excellent opportunity for growth.
FAX ALL RESUMES TO (212) 575-4775
EXECUTIVE
PRODUCTION ASSISTANT SALES
Premium Headwear Company seeks
Major apparel company seeks detail
oriented & organized assistant for a busy
production job dept. Responsibilities
include PO entry, work order entry
and sample tracking plus follow up and
handling of all packing and carton
markings. Must have good computer &
communication skills. AS 400 experience
preferred. Fax resume to: 212-730-9705
Sales Executive for South & North
East Territories. Sales & tradeshow
experience a must. Headwear company
with celebrity product placement and
show events. Department store, specialty
store, boutique experience a plus.
Compensation: Salary + Commission.
Need an energetic individual!
Email: [email protected]
Career Placement
Relocatable and highly qualified
graduates from
Virginia Marti College of Art & Design
located in Cleveland, Ohio seeking
employment in Fashion, Interior,
Graphic Design, and Fashion Merch.
Skills in NED Graphics, Gerber,
Adobe, and various computer programs.
Call 1-800-473-4350
or visit our website at:
www.vmcad.edu
Magaschoni/Global
Wise Development Ltd. Production Coordinator
Creative Designer
MENSWEAR DESIGNER $80K
PATTERNMAKER
DESIGNER
Patternmaker/Draper
DESIGNER
Fast paced children’s accessory co
seeks Accessories Designer with min 3
yrs exp from concept thru first sample
& experience w/overseas development.
Photoshop and Illustrator a must.
Should be a self starter w/ good followthru skills. Great oppty for the right
person who wants to enjoy what they
do! Salary commensurate with exp.
Please fax resume: 212-268-0479
DESIGNER
Senior eveningwear Designer.
Very creative with computer exp.
Excellent salary + benefits.
Please fax resume to: (201) 587-8609
Planner/Retail Analyst
Lg Childrenswear co seeks detailed,
analytical person responsible for analyzing & planning retail acct business
from the mfg side. Retail Link knowledge a Must. Must possess knowledge
of managing inventory levels, flows,
forecasting sales/MD’s and negotiating
MD $’s both in house & retailer’s side.
Fax 212 967 8631 Attn MB
Positions Available!
Assistant Designer
Major apparel company seeks Production
Coordinator. Responsibilities include
delivery tracking, preparing production
status reports, sending out pricing and
order details, creating seasonal design
books and providing administrative
support to team. Candidate must be
proficient with Outlook/Excel and posses
excellent communication skills. Must
be detail oriented.
FAX RESUMES TO: 212-730-7905
Tracking Goods, Lab Dips A Must
Children’s Exp A +. NY Location
Fax Patti: 973-812-1731
Bonpoint Paris, prestigious growing international Children’s
Clothing Co. seeks for its Madison Ave boutiques and new
NY store opening at 392 Bleecker street:
*Production---Production*
Assistants-Coordinators-Managers
Many Jobs-Excellent Salaries
Call (212) 643-8090 Fax (212) 643-8127 (AGCY)
Assistant Managers
Sales Associates
Production Sourcing Mgr $130-160K
Current extensive exp in outerwear,
polyfill, wool, winter jackets req’d.
Must have worked for min 100 mil vol
co. technical proficiency in construction
of outerwear. Will supervise min 10.
Call: 973-564-9236 or
Email: [email protected]
Candidates must have minimum 2 years High-End Retail
Management/Sales Experience , excellent interpersonal skills
and superior customer service. Luxury goods experience a plus.
Production Coordinator
Production Sourcing Mgr to $125K.
Current strong exp in better to bridge
womens market required. Domestic
plus overseas. Well known brand.
E-mail [email protected]
Great Opportunity! Great Company!
Leading Intimate Apparel Mfg. seeks
experienced & highly organized Quality
Assurance person to assist the VP of
QA on all daily activities. Duties include: maintaining all inspection logs,
running in-house processes, sending
products for testing and working on
special projects. Will also asst prod dev
personnel on finished garment audits.
Previous Quality experience mandatory.
Strong follow-up and analytical skills
necessary. Experience in Word, Excel
and Outlook mandatory. Experience
with Walmart, JCP & KMart a plus.
Please FAX your resume to: B. Farrell
(212) 842-4032.
EOE.
Receptionist /
Administrative Asst
Floral Designer
www.bonpoint.com
QA Assistant
Seeking creative, organized Asst. Designer w/3-5 yrs exp in kids market.
Candidate must be team player, strong
knowledge of garment construction,
Bloom Flowers, New York’s luxury Floral fashion trends & be able to meet dead& Lifestyle Retail Store, is seeking a lines. Proficiency in Illustrator CS2, Manufacturer of Women’s Sportswear
talented & passionate Floral Designer Photoshop, Excel along with excellent seeks energetic self motivated person.
Person should possess good interperw/minimum 2 years design experience. communication skills a must.
sonal skills, be organized & dependable.
Competitive salary. Fax: 212-832-8088
Job duties include answering phones,
greeting visitors and administrative
Seeking professional with min. 5 yrs
Design Room Mgr to $175K. Current exp. to design fresh, novelty graphics tasks. Please fax resume to 212-239exp in supervising min. 20 designers, for girls. Must be a team player with 7332 or email to [email protected].
GA’s, assistants, etc. Boyswear li- great color sense and understanding of
censed co. Strong in mgmnt of design current fashion & textile trends. Profiflow, calendar scheduling, etc. Call 973- ciency in Illustrator CS2, Photoshop.
Fashion designer seeks exp’d
564-9236 or email: [email protected]
Please forward resumes to:
Samplemaker for custom couture
[email protected]
eveningwear. Manhattan location.
Great opportunity. Call: (347) 439-5200
EDI Coord to 38K. Exp in Excel + EDI.
Bergen/ Hudson County area. Assist in
Walmart followup. Call 973-564-9236 or
email [email protected].
1+yrs Fash. Exp Excel & Order Processing
[email protected] 212-947-3400
Design
We offer competitive salary and full benefits package.
Please e-mail your resume to: [email protected]
or fax it to: 212-246-3293
SHIRTS & NECKWEAR
SALES ANALYST
Leading Men’s apparel co.
seeks an exp’d Sales Analyst
w/ 3-5 years of retail analysis
reporting, retail sales projections, and retail gross margin
estimates. Ideal candidate
must have very strong quantitative skills and understand
retail & financial performance
metrics. Close work with internal sales team.
Send Resume:
[email protected]
Or Fax 212-689-1439
F/T Sales Associate
Prestigious, fast-paced environment
Madison Avenue Lingerie / Body Wear
Boutique seeks Full Time Sales Assoc.
Qualified candidates will possess supe
rior customer service, sales & communication skills. Please fax resume and
salary requirements to 212-327-0132
Graphic Artist-Girls
suppliers
SAMPLEMAKER
SHOWROOM ASST $27-35K
Account Manager
Gen’l. Manager, N.A. Operations Heads & expands co. in US; plans,
directs & formulates co. policies; hires,
implements & oversees staff in sales,
mktg, account., cust. Svc,, legal &
distribution; develops contacts in S.
America w/textile & garment industry
execs. Min. BA + 5 yrs progressive
prof. respons. in Bsn. Admin. & tech.
knwldg. of alpaca, vicuna & cotton
textile industry. 40 hrs/wk, M-F, 9:00
am - 5:00 pm. Job in NY. Fax resume to
USAlpaca, Attn.: Mr. Freyre @ 212-5754698
Juniors licensee for knits & sweaters
seeks aggressive/ motivated/ dynamic
professional with industry contacts to
fill Account Mgr position & expand
business. Candidates should have a
minimum of 3 years experience.
Please forward resume to:
[email protected]
Graphic Artist to 60K. Exp in girls.
Newborn, toddler, up to tween. Cutsy,
Sweet, Girly applicas and prints. Full
time perm only. Call 973-564-9236 or
email [email protected]
Product Devel $65-70K
PRODUCT DEVEL $40K
Better Bridge Evening Dress Mfg
Must Sketch & Spec. Time’n Action
[email protected] 212-947-3400
Sweater & Knits.
Test/Analyze Yarns & Fabrics
[email protected] 212-947-3400
Tech Designer-$50-60K. Current exp in
putting tech pkgs together to be sent
to far east. Strong in sewing construction.
Long Island City. Call 973-564-9236 or
Email: [email protected]
Technical Designer
Exp’d production technical designer
for major importer of sweaters, knits
and wovens. Resp. include: preparing
production technical packs, fits &
grading. Detailed follow-up with overseas manufacturers, min 3 yrs exp.
Fax resume: 212-382-2549
Web PDM Administrator to $80K.
Current exp in better sportswear co.
Strong exp in interfacing with Seven
On Line program. Call 973-564-9236 or
e-mail [email protected]
travel
real estate
recruitment
business services
vendors
careers
opportunities
Leverage the power of WWD among industry professionals
to reach both active and passive job seekers.
Call 1-800-423-3314 or email fpclassifi[email protected] to advertise.
16 WWD, MONDAY, NOVEMBER 27, 2006
WWD.COM
Russian Doll
— Marcy Medina
— Jacob Bernstein
PHOTO BY BY STEVE EICHNER
The Sample Life
NEW YORK — For any young woman — or two, as the case may be — navigating New York’s social
whirl requires the ability to change on the go.
During New York Fashion Week in September, for example, Byrdie Bell and Olivia Palermo
received invitations (and outfits on loan) for the Zac Posen and Calvin Klein after parties. And
since both events were on the same night, this created a predicament of sorts: Whose frocks
would they wear?
So the two young ladies used a town car as a makeshift closet, unzipping their Zac Posen
numbers and jumping into their Calvins between the events, thereby ensuring that homage would
be paid where homage was due.
“It just seemed appropriate,” says
Palermo, laughing at the memory. “It helps
the designer out and we love
dressing up.”
They sure do.
In the past six months,
Palermo and Bell have been
painting the town red, decked out at virtually
every envelope opening that has a junior
committee. There they were at the Young
Friends for the Met dance. And there they
were at the annual New Yorkers for Children
Gala. First, they started making the party
pages. Then came a phone call from Vogue
to appear in a photo shoot for the magazine’s
October issue.
Now, the two find themselves on tip
sheets for benefits, which is more than a
little amusing to some — and quite a little
annoying to others, given that neither of
them has anything resembling a career,
philanthropic skills or a storied last name.
They grew up near each other in
Greenwich, Conn., but they weren’t what
you’d call fast friends. Bell, an aspiring
actress, is the daughter of New York Times
best-selling author Ted Bell, who writes
political fiction. (“Hopefully, they’ll make his
books into movies so I can star in them,” Bell
Olivia Palermo
says.) Palermo, 20, is studying history at the
and Byrdie
New School. Her father is in real estate and
Bell at a
her mother is an interior designer.
Missoni party.
But they spent their childhoods avoiding
each other.
“Our mothers went to boarding school together,” explains Bell, “but Olivia’s a year younger
than I am, and for a long time I didn’t really want to be friends with her.”
“When your parents try to set you up with somebody, it always backfires, you know?” is how
Palermo puts it.
Fittingly, the two realized they were meant to be friends when they bumped into each other
one night last year at Bungalow 8.
“She was so charming and nice and beautiful, so I said, ‘Let’s have lunch,’ ” Bell continues.
They had lots in common — for one thing, they’re both sample size.
“They’re an example of product seeding,” explains one high-profile fashion publicist. “They fit
in the clothes, so they get a free dress for an evening and the designer gets a chance to make the
party pages.”
And editors are always on the lookout for the next pretty face.
“Their youthfulness is what we noticed about them,” says Vogue’s style director Alexandra
Kotur. “They look great.”
SVETLANA METKINA HAS BEEN
acting since she made her stage
debut as Pippi Longstocking at age
11. A graduate of the University of
Moscow and Shuka University (a
drama school), the willowy Muscovite
appeared in the 1995 Russian film
“Family” and caught the attention of
American filmmakers at the Berlin Film
Festival. She soon racked up credits
in “The Second Front,” “Barbarian,”
“Slingshot” and “Mini’s First Time.”
In her current film, “Bobby,” she
plays a Czech journalist.
She sat with WWD and shared
a few observations.
Coming to America: “It’s
completely new. You are nobody,
nobody knows you and you start
step by step. I like this way. It’s
exciting.”
All in the family: Metkina’s
husband, Belgian
industrialist Michel Litvak,
is one of the producers of
“Bobby,” but her role in
it is also special because
her father is a journalist.
“I know how important it
is for him to get those five
minutes for an interview.
It is also important to
have that freedom. When
I was born in Moscow, we
still had the Iron Curtain.”
Striking a pose: Metkina
modeled in Paris for two years.
“It’s not just beautiful girls
wearing beautiful clothes. It’s
hard work.”
In costume: “I love to mix styles.
Right now my favorite period is the
Sixties and it came from ‘Bobby.’ I
love Jackie Kennedy’s style.”
Svetlana
In the moment: “For me, the glass
Metkina
is always half full. My favorite
place is wherever I am. I love
New York for the energy, Paris
because it’s beautiful, Spain for
holiday and Italy for food.”
Fashion: Favorites include Balenciaga, Lanvin,
Marni, Alexander McQueen and Thomas Wylde.
On the record: “I travel alone, normally, and I love to talk to
people on the plane. Sometimes I write down the things they
tell me in short stories.”
— Katya Foreman
PHOTO BY DOMINIQUE MAITRE
Metkina in a
scene from
“Bobby.”
PHOTOS BY JIM SMEAL/BEIMAGES AND WEINSTEIN CO./NEAL PETERS COLLECTION
BAT GIRL
PARIS — Resembling a cosmic Hiawatha with her raven bangs, gold
headband and licks of glittering war paint smudged across her cheeks,
Natasha Khan, the 27-year-old lead singer of British band Bat for Lashes,
bewitched the audience at La Cigale on a recent Saturday night — she
threw back her head and let out a guttural howl.
“It’s such an amazing, primordial sound that creates a sense of
community,” Khan mused after the gig. “I think I heard ‘Teen Wolf’
somewhere out there in the front.”
Rattling wind chimes, ringing bells and pounding shakers against
drums are part and parcel of Khan’s mystic stage act, led by her haunting
vocals and the hand claps, foot stomps and musical meanderings of her
Bat for
bandmates, Ginger Lee, Abi Fry and Lizzie Carey.
Lashes’
Following the U.K. release of its debut album, “Fur and Gold,” the band
Natasha
— whose music might be categorized as experimental pop — is heading for
Khan.
the States in March to play at the South by Southwest festival in Texas.
Born to an English mother and Pakistani father, a famous squash coach
who would take his family along with him on world tours, Khan says her memories of Pakistan are a wellspring of
inspiration. Losing a pet goat to a sacrificial religious ceremony, say, is just one souvenir that transfused into a song.
“It was a very mystical and magical experience with lots of storytelling and fables about genies and spirits,”
recalls the singer, whose kindred musical spirits include the likes of Kate Bush, Cat Power and David Bowie in
his Ziggy Stardust phase.
Pakistan’s sartorial customs — embellishment and gold jewelry — also have seeped into her act. She collects
chains (mainly foraged in markets and thrift stores across England) and crafts golden headbands for herself and
the girls, festooned with old badges.
“My sweetheart wears this very same necklace [across the pond],” says Khan, clutching a vintage King
George pendant that she gave to her boyfriend, Will Lemon, a New York-based artist. In return, she’ll often wear
Lemon’s tapestry-printed clothing on stage. “I love wearing his wild William Morris prints and biker boots,” says
Khan. Not forgetting all that’s gold.
“Wearing anything sparkly is wonderful. It puts me in the mood to perform.”
WWDICSCPREVIEW
SECTION II
ILLUSTRATION BY MATT COLLINS
The
Meaning
of Green
Development that benefits
the environment can help
boost the bottom line.
See pages 16 to 17.
P R O P E R T I E S
Fashioning Elite Opportunities
For Platinum Property leasing information,
please call 312-960-2650
ALA MOANA CENTER, HONOLULU, HI • BEACHWOOD PLACE, BEACHWOOD, OH
BRIDGEWATER COMMONS, BRIDGEWATER, NJ • FASHION SHOW, LAS VEGAS, NV
GALLERIA DALLAS, DALLAS, TX • GLENDALE GALLERIA, GLENDALE, CA
KINGS’ SHOPS, WAIKOLOA, HI • MIZNER PARK, BOCA RATON, FL
NATICK, NATICK, MA • NORTHBROOK COURT, NORTHBROOK, IL
OAKBROOK CENTER, OAK BROOK, IL • PARK MEADOWS, LITTLETON, CO
PIONEER PLACE, PORTLAND, OR • SAINT LOUIS GALLERIA, ST. LOUIS, MO
SUMMERLIN TOWN ENTER, SUMMERLIN, NV
THE GRAND CANAL SHOPPES AT THE VENETIAN, LAS VEGAS, NV
THE SHOPPES AT THE PALAZZO, LAS VEGAS, NV • THE SHOPS AT LACANTERA, SAN ANTONIO, TX
TYSONS GALLERIA, MCLEAN, VA • VILLAGE OF MERRICK PARK, CORAL GABLES, FL
WATER TOWER PLACE, CHICAGO, IL • WHALERS VILLAGE, KAANAPALI, HI
4
WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW
contents
8
14
16
20
6 RETAIL DEVELOPMENT
ENTERS NEW ERA
ICSC chairman John Bucksbaum waxes
poetic on development today.
8 SCENE
Where to shop and what to see while in
New York for ICSC.
10 DONE DEALS & IN DEVELOPMENT
An Arizona town welcomes Louis Vuitton
and an art exhibit lights up a Ginza retail
building.
12 REITS ROARING
ON WALL STREET
Retail REIT stocks continue to outperform.
14 REDEFINING TOP
MALL ATTRACTIONS
Landlords broaden the definition
of a traffic generator.
16 THE MEANING OF GREEN
Boosting the bottom line
with sustainability.
18 ON THE JOB
How a retail broker leverages her Rolodex.
LUXURY RETAILERS EXPAND,
CAUTIOUSLY
The Macerich Co. takes the temperature
of luxury retailers.
20 ON THE ROAD
22
Black gold transforms Calgary.
22 PENNEY’S PROGRESS
J.C. Penney looks beyond the mall.
Join the crowd that stands alone
The Shoppes at The Palazzo is setting a new standard for Las Vegas Luxury.
Now is your chance to join trendsetting retailers such as Barneys New York, plus exciting cuisine and posh nightlife which will
provide a younger, fresher and more seductive alternative to typical luxury. Even the location of this unique experience is unmatched,
as it will complement and enhance The Strip's most visited locations - The Venetian and The Grand Canal Shoppes.
To be a part of The Shoppes at The Palazzo, contact:
Lori Pawley - Vice President, Fashion Retailing
312.960.5880 • [email protected]
Lou Silvestri - Executive Director of Leasing
702.414.3549 • [email protected]
THESHOPPESATTHEPALAZZO.COM
6
WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | CHAIRMAN’S VIEW
Retail Development Enters New Era
ICSC chairman John Bucksbaum hones in on mixed use and densification.
By David Moin
J
ohn Bucksbaum, chief executive officer of General Growth Properties Inc.
and chairman of the International Council of Shopping Centers, has strong
opinions about what consumers and communities want from him and other
developers.
“They are encouraging densification,’’ he said in an interview. “They don’t
want more ‘greenfield’ in development.”
By densification, he means redeveloping malls with offices, hotels, theaters,
parks, outdoor dining and other elements beyond the traditional menu of department and specialty stores and fast-food courts. It often means reclaiming abandoned department stores and other spaces and rebuilding and upgrading properties to be more in touch with current lifestyles.
The mixed-use phenomena will be a major theme in Bucksbaum’s state of the
industry address and a special session at the ICSC New York National Conference
& Deal Making meeting, Dec. 4 to 6 at the Hilton New York.
Mixed use emerged as a trend in development in the Eighties, but in many
cases flopped because the market demand for certain elements contained in the
projects was absent, Bucksbaum said. “Now we are able to pick and choose and
bring more of the art of science” to densifying malls, he said. “We can understand what other uses [beyond retail] can be successful in a marketplace. Going
forward, you will see much more mixed use. People don’t want to commute 90
minutes to work. Consumers don’t want to drive 30 minutes to go shopping.”
Bucksbaum returned from a mixed-use conference in Hollywood, Fla., last
month convinced that it’s the way of the future. “This was a remarkable conference in the sense that it was the first [of its kind] put on by five different trade
organizations.” ICSC was the lead organizer; others hosting the event were the
National Association of Industrial and Office Properties, the National Multi
Housing Council, the American Resort Development Association and the Building
Owners and Managers Association.
“They were expecting maybe 400 people,’’ Bucksbaum said. “We had 1,100.
That shows you the interest in what’s happening in real estate. Mixed use is
very much front and center today. We have the room on our sites to bring it
in. Retail is a wonderful hub to build around. You can take back [vacated] department store space, and do other retail formats, residential, offices or hotels, depending on what’s the greatest demand for that space….In the Eighties,
people were building all four components on Day One,” and that sometimes led
to failure, he noted. But now there’s a greater chance of success since developers have a better understanding of the market demands at properties that have
been around for awhile.
General Growth’s Natick Mall in Massachusetts is being renovated and expanded with what Bucksbaum described as a second, more upscale center that will be
anchored by Nordstrom and Neiman Marcus, and two, 12-story residential buildings with luxury condominiums. The 40-year-old site has about 1.6 million square
feet of gross leasable space and is anchored by Macy’s, Lord & Taylor and Sears.
“We expect it to become the South Coast Plaza of the New England region,”
Bucksbaum said. The 40-year-old South Coast Plaza, in Costa Mesa, Calif., has 2.8
million square feet of gross leasable space and is the biggest in the country, for
retailing, though Mall of America has more total square footage when you add in
its entertainment features.
On a smaller scale, General Growth operates mixed-use centers such as Mizner
Park in Boca Raton, Fla., which is 15 years old and includes retail, residential and
office space, along with an art center and a performing arts center. “It’s a highly
productive center,” Bucksbaum
John Bucksbaum
said, with about 175,000 square feet
for retail, about 800 or 900 residential units, and more than 150,000
square feet of office space.
“There is a lot of complexity to
mixed use,” Bucksbaum continued. “There are more opportunities to fail when you start getting
involved in more than one type of
use. It’s got to be well planned and
that’s not easy.”
There’s a lot of construction
and architectural considerations,
he noted, such as with residential
coexisting in a retail project, entrances and parking locations for
residents must be thought through,
as well as what the view from the
apartments would be.
Developers also must update
their retail space. Market demands
are changing and consumers want
revamped formats, whether it’s
open-air settings, stores with entrances and facades facing mall
exteriors for easier access from
their cares, retail “streetscapes” or
outdoor retail villages with cafes,
fountains and parks.
“The way malls are being designed and built is much different
today,” Bucksbaum said. “It’s as an
exciting period for our industry as
we ever had.”
Retailers are starting to understand if they want to continue to expand, they have to rethink their real
estate for different settings, such as
— John Bucksbaum,
urban markets. “There is real busiGeneral Growth Properties Inc.
ness to be done in urban markets,’’
he said. “More and more retailers
are exploring them.”
Also, developers are going upscale in terms of tenants, ambience and amenities. “This is very much a trend,” Bucksbaum said. “All customers have aspirations to move up. Retailers have done a good job of adjusting their selections.
Coach is probably the best example of [a retailer] who has brought a luxury name
to a level of affordability. Neiman Marcus is doing that with Cusp,” a new division with two units and a contemporary assortment. “Apple is a great example
of an upscale product within reach of the masses. There is a belief that upscale
retail is a little more recessionary proof. With department store consolidation,
Nordstrom is being given new opportunities in markets that didn’t exist for them
before. Neiman’s, too.”
Mixed use is very much
front and center today….
Retail is a wonderful hub
to build around.
“
”
ICSC to Roll Out Retail Runway in New York
T
Wild Oats will be part of ICSC’s Retail Runway. Inset:
Charles Tomb of Starwood Hotels & Resorts Worldwide.
he International Council of Shopping Centers’ New York National Conference & Deal Making
convention will open its doors on Dec. 4 at the Hilton New York in Manhattan. The conference
will also kick off ICSC’s 50th anniversary celebration.
After the Las Vegas annual convention, this is ICSC’s most popular meeting of retailers and owners. Hundreds of retailers, ranging from Big Lots and Dress Barn to Sally Beauty and Hannaford
Bros., will be exhibiting, along with developers including Simon Property Group, General Growth
Properties, Forest City Enterprises and Federal Realty. It is expected to draw 7,000 real estate and
retail executives for networking, deal-making and a few choice panels. The conference will also
include ICSC’s first “Retail Runway,” which will allow fashion retailers such as Planet Funk, Blue
Mercury, Lulu Athletica and Limited Too to exhibit their business and expansion plans in a
new runway format. Grocer Wild Oats and restaurants Dunkin’ Donuts and P.F. Changs
also will exhibit in the Retail Runway.
Several notable executives will speak at the panels:
● “Mixed-Use Development” will examine whether this development concept has
longevity or if it is a passing trend in retail. Speakers include Barry Dinerstein, the
deputy director of housing, economic development and infrastructure planning
for the city of New York; Christopher Pine, the vice president of real estate for
Whole Foods Market, and Charles Tomb, senior vice president of development for
Starwood Hotels & Resorts Worldwide.
● At “Wall Street on Retail,” experts from the major brokerage houses will evaluate year-end projections and industry trends. Speakers include retail analysts from
Bear Stearns, HSBC and Morgan Stanley.
— Amy S. Choi
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8
WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
Get out of Midtown, off Madison
Avenue, and into the fray. And, no,
the Meatpacking District and the
Lower East Side are no longer
considered off the beaten path.
Food to Fashion on Smith Street
F
alling Williamsburg the new East Village is so 1999.
Hipsters and artists priced out of the Lower East Side once flooded across the East
River to seedier digs among the warehouses and abandoned manufacturing buildings
along the water in north Brooklyn. Now Bedford Avenue — Williamsburg’s “downtown”
— is saturated by boutiques, upscale restaurants and, much to some locals’ dismay,
chains such as American Apparel, Subway and Tasti D-Lite. The throngs are pressing
further south and east, bringing $200 skinny jeans and shaggy-chic haircuts to a section of Brooklyn better known for its Hasidic synagogues and Puerto Rican Day Parade
parties than for its fashion.
Grand Street, which intersects the south end of Bedford, is one new nucleus of
Williamsburg shopping.
“I hit the jackpot with this place,” said Liz Santiago, proprietor of CeleBritAy and
chemist behind the company’s luxury handmade spa and bath products. “It was a
shamble when I got here, but I’ve put a lot into it and love the location.”
From her perch on Grand Street and Marcy Avenue, the furthest reach of Grand
Street before it abuts the Brooklyn-Queens Expressway a few yards past her door,
Santiago creates, packages and sells her concoctions in a store the size of a typical apartment — a 400-square-foot, New York-scale studio. A 6-oz. bottle of her
Seabuckthorn Berry body lotion, mixed with five exotic essential oils, rings up at $75,
while 8 oz. of Raspberry Icelandic Brine bath salts costs upward of $40. One of her
most popular items, the Pumpkin Pie Milk Soap, runs around $30. Santiago opened up
shop in November 2005, and while she only gets a dozen or so walkers-by during the
week, traffic picks up significantly on weekends.
Such pockets of chic, ensconced in less-than-glamorous settings, are the calling card
of South Williamsburg. CeleBritAy, however, is soon to become enveloped in a retail
streetscape to rival Bedford Avenue.
Next door, in a dilapidated brownstone, Grand Society sells antiques and designs
wedding dresses. Down the block, Armoire offers mimosas for weekend morning
shoppers browsing the racks of local and big name designers such as Mike & Chris
and Earnest Sewn. Across the street, Mandate of Heaven’s flagship — the retailer
also has stores on the Lower East Side, in SoHo and in neighborhoods in faraway
Los Angeles — offers edgy, vintage schoolgirl-esque collections. Pop, a Washingtonbased retailer that sells labels such as Penguin and Ben Sherman, opened on Grand
Street last fall and receives new shipments of men’s and women’s clothing and accessories daily.
“The activity on Grand Street has become incredibly heavy,” said Agapito Garcia, a
broker with Leiter Realty Group, which controls much of the space in the area. “The
street was neglected for the past 30 years, but it used to be the most upscale street in
Williamsburg. We’re trying to bring it back to what it once was.”
As the neighborhood strives to do just that, rents are rising. While Santiago pays
only $1,000 a month in rent for her space — roughly $30 a square foot annually — some
commercial retail space is going for as much as $60 a square foot, while upscale condominiums sprouting along Grand Street are being marketed for $900 a square foot, or
a whopping $1.3 million for some of the larger units.
In response to the price tags, retail development is pushing further east. Emptied,
polished storefronts, poised for new retail, are replacing dollar stores and bodegas
along Broadway near Hewes and Lorimer Streets, while a corner space formerly occupied by a dry-cleaning business on Broadway and Keap streets is being marketed by
Newmark Knight Frank Retail, one of New York’s largest retail brokerages. Meanwhile,
chic restaurants are drawing hip kids from as far east as the border of Bushwick. One
such eatery is Mojito Loco on Meserole Street and Manhattan Avenue, which offers
Peruvian and Pan-Latin cuisine.
“We’re looking to create a complete neighborhood,” said Garcia. “And what is good
for the neighborhood is more retail.”
ood has long been the lure that coaxed adventurous Manhattanites
to Brooklyn’s Smith Street. The opening of a string of boutiques over
the past two years, however, has transformed the area into an equally
impressive retail destination with a reputation stretching well beyond
the city limits.
The intersection of Atlantic Avenue and Smith Street marks the entrance
to a bustling mile-long stretch of bars, restaurants and boutiques that has
sent the young professional demographic flocking to the area. The intersection is also representative of the change. A long-vacant jailhouse occupies
one corner, a Brooklyn Industries store sells hooded sweatshirts, T-shirts and
bags on another and a new combination hotel and luxury apartment building
with penthouses going for more than $1 million is on the rise on another.
When Lara Fieldbinder and her husband began scouting locations for
their store, Dear Fieldbinder, they had concerns about setting up camp on
Smith Street. “We thought we might be taking a risk being on Smith,” said
Fieldbinder, an art school graduate who has lived in the neighborhood for
four years. A location on Court Street, which is a block away and runs parallel to Smith, seemed a safer bet. “We stood in an area and counted the
number of people that walked by at 1 p.m.,” said Fieldbinder. “On Court they
had three times as many people, but Smith did have something gritty and a
little more interesting.”
The edgy environment and a larger store space tipped the scales in
Smith’s favor. Dear Fieldbinder opened in August 2005 and sells labels such
as Edward An, Deener, Rachel Mara and Rachel Pally. Since opening, concerns over foot traffic have subsided and Fieldbinder has seen significant
changes in the customers coming through her door. “We get a lot of tourists
now, a lot of Japanese tourists,” said Fieldbinder, a trend she attributes to
the store being mentioned on a Japanese blog. Along with having two subway
stops on the street, Fieldbinder believes Smith has an advantage over other
better-known shopping destinations with its size. “What’s nice about Smith is
it’s small. It’s not overwhelming, you can do it in an hour or a little more.”
Rick Lee has been in the shoe business for 14 years, including a 10year stint as a buyer and
divisional merchandise
manager at Barney’s
New York. Lee opened
Soula in May 2004, one
of the few devoted shoe
retailers on the street,
and has witnessed the
explosion of retail and
a corresponding increase in the number of
tourists in the area. “In
terms of the residential
situation, there are a
few new buildings going
Smith
up, but it’s more or less
Street’s
saturated in terms of the
newest
population,” said Lee.
addition.
“Now it’s becoming more
known to people who
live outside of the area.”
The most recent addition on Smith is Lucia, selling labels such as Max
& Cleo, Collective Clothing and Cloud Nyne with retail prices ranging from
$60 to $200. Owner Lucy Banduci and her husband, Ted Dalton, opened their
first Lucia location in neighboring Park Slope two and a half years ago after
having concerns about Smith similar to those of Fieldbinder.
“Three years ago when I was looking to open my first boutique I didn’t
necessarily see Smith as a shopping destination because it’s so heavy on the
dining,” said Banduci. “But in the last three years the retail that has popped
up is mind-blowing. I love shopping in all of them, and I live here and have
my own store.”
Banduci and Dalton moved quickly to claim a space on Smith when it
came up two months ago and moved just as quickly to get the doors open.
Lucia opened on Nov. 11 and was packed within minutes of the construction paper being taken down from the storefront windows, said Banduci. “It
stayed that way until 8 [p.m.].”
Something Else is another example of a Smith Street store owned by a
local. Doug Grater opened the store in March 2005, selling contemporary
apparel such as Adidas, Puma, Kenneth Cole, Juicy Couture and Seven For
All Mankind. Grater’s father opened the first Something Else in Bensonhurst
four decades ago. In an interview with WWD shortly after opening the store,
Grater said he welcomed the opening of more stores on Smith.
“I think it will keep customers on the block and prevent them from going
into Manhattan,” he said. “One store is not going to keep them on the block.”
Local entrepreneurs have been so successful in raising the street’s profile
that major corporations have started moving in, often to the displeasure of
those who valued the street’s traditional Italian roots. A new Eckerd’s drug
store forced out local pharmacies. American Apparel opened a store this
year, complete with bright neon lighting and sexually suggestive marketing.
A combination Baskin-Robbins and Dunkin’ Donuts store that opened this
summer gave Smith its first helping of fast food. Despite this, Banduci feels
the homegrown outfits will continue to have the upper hand.
“I find that people who live in Brooklyn, and I’m one of them, they
love to support local businesses,” said Banduci. “I think that’s why a lot
of them thrive.”
— Amy S. Choi
— Ross Tucker
Here are four hot retail spots
in New York.
Liz Santiago mixes luxury
soaps at CeleBritAy.
Williamsburg Beyond Bedford Avenue
C
CELEBRITAY PHOTO BY AMY S. CHOI; LUCIA BY ROSS TUCKER; MOBAY AND N BOUTIQUE BY TALAYA CENTENO; LYD BY JEANINE POGGI
scene
ICSC PREVIEW | SCENE
WWD, MONDAY, NOVEMBER 27, 2006
9
WWD.COM
Harlem: Local Spice and More
T
Above: Mobay takes
soul food a step up.
Right: Designer wares
at N Boutique.
Harlem’s a
friendly place….
Harlem welcomes
everyone with
open arms.
“
”
— Gia Hamilton,
Denim Library
he first Harlem Renaissance had jazz and Langston Hughes. The current renaissance has fashion, restaurants and Mobay.
The restaurant sits in the middle of 125th Street between Fifth and Lenox
Avenues, inviting the busy pedestrian shopper to stop, relax and — most importantly — eat. Inside, neighbors and strangers munch on soul food such as
jerk chicken and curried shrimp. Thanks to the growing sidewalk traffic in the
neighborhood, and on 125th Street in particular, Mobay is a financial success.
And it’s not alone.
The stretch of 125th Street from Madison to Seventh Avenues is the center of
activity, with an array of national brands: MAC, The Body Shop, Lane Bryant,
Payless Shoes, Taco Bell and Pizza Hut, for starters.
But, like Mobay, the real gems of Harlem are the home-grown stores and restaurants — such as the 40-year-old, family-owned soul food institution Sylvia’s
Restaurant on Lenox Avenue and 126th. For the off-beat shopper there’s
Xukuma (pronounced zoo-kooma) on 125th that features funky housewares,
jewelry, accessories and T-shirts, at prices from $4.95 for bronze earrings to
$125 for a hand-blown glass decorative bowl. Also on Lenox Avenue is the colorful children’s shoe shop Purple Reign, where shoes sell for
$22 to $220. Harlemade is just across Lenox with a wide selection of T-shirts, totes and sweatshirts designed by owner
Murphy Heyliger and other local designers.
Right off of 125th Street, there’s The Brownstone on
Fifth Avenue, “Harlem’s first lifestyle shop.” In business
since 1998, the store is housed in a turn-of-the-century
brownstone and showcases local ethnic designers’ wares,
from “euphoria-infused shea butter” soap to a classy
church hat. Prices for apparel range from $35 to $450.
The Harlem Business Alliance has made an effort to market new shopping blocks away from the hubbub on 125th
Street to places where rent may be more affordable, such as
116th Street and Seventh Avenue, between 135th and 137th
Streets. There are several other retail enclaves in South
Harlem, like the smattering of stores and restaurants on
116th, including the open-air flea market Malcolm Shabazz
Market. N Boutique, also on 116th, sells locally designed
jewelry, cosmetics, accessories, housewares, men’s bespoke
tailoring (prices begin at $2,000) and a women’s ready-to-wear collection that includes Calvin Klein and Nicole Miller, retailing
anywhere from $30 to $150.
B. Oyama, on Seventh Avenue at 137th, is run by proprietor Bernard Oyama, who sells elegantly tailored men’s wear. On this
block one also can find Denim Library, a denim retailer that has been in business since January. Prices for designer denim such as
True Religion and William Rast range from $130 to $400.
The retail reawakening of Harlem has been the mission of Harlem shop owners, residents, grassroots organizations such as
Harlem Business Alliance and 125th Street Business Improvement District and government nonprofits for years. But their success
might not have been possible without the Federal Empowerment Zone legislation.
The Upper Manhattan Empowerment Zone, one of nine such zones nationwide set up by 1994 legislation sponsored by a local
congressman, was given responsibility for the economic development of select areas in Harlem, East Harlem, Washington Heights
and Inwood. In the last 10 years, UMEZ has made “Harlem a more integral part of the New York City economy,” said Kenneth J.
Knuckles, its president and chief executive. Now, “125th street is seen as a vital commercial corridor,” he said.
The first visible sign of revitalization was the opening of Harlem USA (a retail complex that houses a Magic Johnson Theatre,
Old Navy, a Disney Store and New York Sports Club) on 125th Street in 2000. The project was funded by private developers and
UMEZ. “It was the first of its kind [in Harlem] and it created 300 jobs.”
The crime rate dropped drastically in Harlem and the rest of New York City in the late Nineties. According to Princess Jenkins,
owner of The Brownstone, “We’ve definitely seen a reduction in crime….I’ve always felt safe in Harlem as a resident. I’ve never
felt threatened.”
Gia Hamilton, a shop clerk at Denim Library who was born and raised in Harlem, summed up the sentiment of the developing
neighborhood: “Harlem’s a friendly place….Harlem welcomes everyone with open arms.”
— Lauren Benet Stephenson
Hell’s Kitchen Heats Up With Local Designers
H
ell’s Kitchen has become so chichi it’s gotten a new name. Once polluted by street
gangs and organized crime rings, the neighborhood has since become a haven for sleek
shops, trendy bars and ethnic restaurants.
“Clinton” is now home to yuppies, artists and
Locals love Lyd.
the stroller set.
The area west of Eighth Avenue between
34th and 59th Streets is hailed as the up-and-coming real estate center in
Manhattan. While still peppered with locally owned boutiques, bakeries and
restaurants, chain stores and posh hangouts are continuously popping up between these mom-and-pop shops.
“When I was first living here I use to find used needles on my stoop,” said
Camille Tibaldeo, communications manager of the local Fountain Gallery
and a 30-year resident of the ’hood. “Now when I look around there are six or
seven Starbucks in my immediate vicinity. Every week if you walk over to Ninth
Avenue, there is a new restaurant.”
Even though Hell’s Kitchen has always been in close proximity to the
Theater District, few were brave enough to venture farther west. Now theatergoers visit the area on a Saturday night after a Broadway show to try one of the
many eateries along Ninth Avenue, known as Restaurant Row.
The stretch is filled with inexpensive international cuisine, featuring everything from Greek and Italian to West African and Caribbean dishes.
Breeze, an upscale Thai and French fusion restaurant located on Ninth
Avenue between 45th and 46th Streets, represents the new wave of restaurants
in the area. Entrées range between $11 and $21.
Mercury Bar & Grill and Social are two of the hip nightspots to grab a beer,
watch a football game and chat with friends. Mercury has a relaxed vibe with
a mixed crowd of the neighborhood’s newcomers. Social, with three floors offering televised sports games, club Fusion and a rooftop deck, has something
for everyone.
While the area is predominantly known for its abundance of dining possibilities, apparel and gift shops are scattered throughout.
Lyd, run by local stylist Mia Gonzalez, sits on 44th Street and Ninth Avenue.
It sells contemporary women’s clothing and accessory lines from New York, Los
Angeles and London, while Jane Elissa Atelier, on 46th Street, between Ninth
and Tenth Avenues, has a variety of clothing, custom jewelry and home goods.
As Hell’s Kitchen gets a face-lift, the area whose main attraction used to
be its affordable housing now rents apartments at rates on par with the rest
of the city.
“When I moved here the area used to be called the Dance Belt, because
dancers from the shows use to live here, not only because of its proximity to the
Theater District but more so because of its affordability,” Tibaldeo said. “We
still have plenty of actors and musicians, but if they haven’t been living here for
a while, they still have to find a way to make rent.”
The typical apartment, which was once a walk-up tenement, is being replaced by luxury rentals and fancy condos. Though some classic brownstones
remain, many of the apartments are like The Orion, a 60-story condo on 42nd
Street and Ninth that rents one-bedroom apartments for $3,000 a month.
— Jeanine Poggi
10 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | NEWS
Celebrating Holidays With Art and Relaxation
ROOM TO BREATHE
Taubman Centers’ Mall at Short Hills in New Jersey has opened
the first American Express Members Lounge, providing shoppers
a break from mall traffic. The 3,400-square-foot space on the first
level of the upscale mall is for American Express card members
and offers refreshments, a coat check, rest rooms, couches, giftwrap services, iPod and cell phone charging stations and an
e-mail station, all complimentary.
“We are focused on creating unique and meaningful experiences for our card members, and the Members Lounge provides a relaxing environment where they can get the services
they need during a very hectic holiday shopping season,” said
Ralph Andretta, senior vice president and general manager of
Membership Rewards for American Express.
American Express offers cardholders
a reprieve in a New Jersey mall.
TIME FOR AN EXPLOSION OF RETAIL
Sub Chrono, a manufacturer of high-tech, modern Swiss watches,
opened its first New York location at 580 Fifth Avenue and 46th
Street. The Tel Aviv-based retailer, which currently only has one
other U.S. store, in Miami, expects to open 30 more stores in the
country within the next three to five years. The expansion will
more than double its portfolio.
“They are a very funky, fashion-forward brand,” said Jeffrey
Roseman, executive vice president at Newmark Knight Frank
Retail, which represented Sub Chrono in the deal. “They are targeting stylish, younger, hipper shoppers.”
The next target markets for the retailer include Los Angeles,
Las Vegas, San Francisco and Chicago. Sub Chrono currently
has 23 stores globally. In addition to its Stateside stores, it operates boutiques in Spain, Israel, Hong Kong, Holland, Mexico
and Greece.
Chanel
towers
over
Tokyo.
ICONIC CHANEL, 10 STORIES HIGH
The Chanel Tower in the Ginza district of Tokyo will showcase Israeli artist Michal
Rovner through the end of the year — not with a piece within the store, but in the shape
of a massive video installation against the exterior of the 10-story tower, which opened
in 2004. “Tweed, Tokyo” will project abstract, moving images on a backdrop of the iconic
Chanel tweed pattern through 700,000 LED lights in the Chanel Tower.
Rovner and New York-based architect Peter Marino, who designed the Ginza building, have installed the similar “Tweed, Osaka” in Chanel’s Osaka boutique.
— Amy S. Choi and David Moin
Retail Blooms Across Ariz.
By Sharon Edelson
BEYOND SCOTTSDALE
Mall owners and retailers are chasing the population of Scottsdale, Ariz., north
with several ambitious projects in various stages of development.
Westcor, a division of the Macerich Co., is planning Palisene on 72 acres
northwest of Loop 101 and Scottsdale Road. DMB Associates is building
One Scottsdale on 120 acres northeast of Loop 101 and Scottsdale Road, and
the Thomas J. Klutznick Co. is developing CityNorth with Related Urban
Development, a project with 1.1 million square feet of retail space, in North
Phoenix near the Scottsdale border.
Scottsdale isn’t the only area in metropolitan Phoenix experiencing rapid
growth. Glimcher Ventures Southwest and General Growth Properties have
zeroed in on Peoria and Glendale, both northwest of Phoenix, where a new
Glendale Arena and Cardinals Stadium will be built along with millions of
square feet of office space.
In addition, new zoning has been approved for more than 40,000 new housing units in the area.
Glimcher, which recently sold a portion of its $250 million Parke West project in Peoria to General Growth, has a development and management agreement to oversee the construction and opening of the project. The Parke West
site is located at Loop 101 and Northern Avenue in the West Valley, two miles
north of the University of Phoenix stadium.
General Growth paid $28 million for 46 acres of the future Parke West site.
The mixed-use lifestyle and entertainment center will include 356,000 square
feet of retail shops and restaurants, a Harkins Megaplex Theatre, office space
and an apartment community.
The center has lease commitments from Chico’s, White House/Black
Market, Victoria’s Secret, Bath & Body Works, PacSun, American Eagle, New
York and Co., Fleming’s, Anchor Blue, Brighton Collectibles, Christopher &
Banks, Sunglass Hut, Francesca’s, Hot Topic, J. Stephens Shoes and Sandbar
Mexican Cantina.
“We are excited about the strategic partnership with General Growth
Properties and we are in discussions to do a number of future projects together,” said David Glimcher, president of Glimcher Ventures Southwest.
General Growth also owns Arizona Center in downtown Phoenix. In Tucson,
the company owns and manages Park Place and Tucson Mall.
LUXURY BRAVES SIZZLING HEAT IN TUCSON
When Louis Vuitton opened its store at La Encantada in Tucson this month, the
company joined a small cadre of upscale retailers that are betting luxury sales
will blossom in the desert.
La Encantada, a 258,000-square-foot open-air lifestyle center, opened in
2003 and is operated by the Westcor division of the Macerich Co. It has about
50 stores, most of them new to Tucson, including Anthropologie, Coach, Cole
Haan, Crate & Barrel, Lucky Brand Jeans, MAC and Pottery Barn. Tiffany &
Co. opened a unit in the center in October and new stores such as BCBG Max
Azaria are to join in the coming months.
The Louis Vuitton store carries an array of leather goods from the company’s
traditional and fashion-forward collections, including luggage and city bags.
The store also features sunglasses and textiles.
“We are very excited about the potential of the market and we are confident
the local community will be an important customer for this store,” said Philip
Corne, president and chief executive officer of Louis Vuitton North America.
While La Encantada has attracted a handful of upscale tenants, the majority
of well-known luxury brands still elude Tucson.
The city hasn’t landed Bloomingdale’s, Nordstrom or Neiman Marcus, and
designers such as Gucci, Giorgio Armani, Fendi and Prada have yet to open
stores there. Experts said the city may need to grow in population and per
capita income for luxury retailers to arrive in serious numbers.
Tucson is a small city — its population was 502,100 in 2004 — and seasonal
factors come into play. Part-time residents, college students and tourists flee
the heat during the summer.
While Tucson’s median average income is about $41,000, the average household income for families living within two
miles of La Encantada is $121,000, according to Westcor. Census Bureau figures show
roughly 6,000 Pima County households report annual incomes of $200,000 or more.
Still, companies like Louis Vuitton believe there are enough wealthy travelers
and second-home owners to keep the cash
registers humming during the height of
the season.
Tourism, which draws about 3.5 million
visitors, is a $2 billion a year industry in
Tucson. Four million Mexican visitors spend
almost $300 million a year in the city, said
the Metropolitan Tucson Convention and
Visitors Bureau.
12 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | FINANCIAL
REITs Roaring on Wall Street
Year-to-date stock performance sees 21.7% gain on average.
By Arthur Zaczkiewicz
Retail REITs in a Bull Run
R
etail real estate investment trusts have been thundering along in a bull
market for a few months, with average stock prices up over 25 percent
year-to-date, thanks to improved operating trends and higher demand. The
stock gains were achieved despite investors and industry executives squabbling over valuation metrics.
Meanwhile, one big Wall Street firm said in a research note that valuations
in the broader REIT market could continue to see some gains as companies
leverage positive economic trends. In short, it’s a good time to be a REIT.
“We believe REITs should deliver more modest returns over the next 12
to 15 months, in the 8 to 12 percent range, based on solid, high-single-digit
earnings growth, plus the current 3.8 percent dividend yield and assuming
stable multiples,” said Goldman Sachs equity analyst Jonathan Habermann
in an industry outlook report. “In our view, REITs should remain appealing
to investors given the lower return expectations on the part of institutional
investors.”
Habermann said he expects REITs to continue to post improved operating
fundamentals as well as ongoing demand in key markets. Regarding mergers
and acquisitions activity, which have been partly driving valuations, the analyst sees deals continuing through next year. Until then, REITs can celebrate
robust stock gains made so far this year.
Of the 27 public retail REITs tracked by WWD, the unweighted, average
gain of the stocks from the first day of trading this year through Nov. 14 was
21.7 percent (see chart). The shares of 25 firms experienced gains while two,
Feldman Mall Properties and Mills Corp., showed declines of 10.7 and 52.4
percent, respectively.
Of the stocks that had gains, 20 showed increases of 20 percent or more.
The top gainers were Forest City, Saul Centers and Vornado Realty Trust, with
increases of 46.5, 46.3 and 42.4 percent, respectively. The bulk of the gainers
delivered results more in line with Simon Property Group and Cedar Shopping
Centers, which saw increases of around 25 percent.
(Year-to-date stock performance)
Company (ticker)
Closing price
on Jan. 3, 2006
Closing price
on Nov. 14, 2006
%
Change:
Forest City (FCE-A)
$37.24
$54.54
46.5
Saul Centers (BFS)
36.39
53.23
46.3
Vornado Realty Trust (VNO)
82.88
118.04
42.4
Ramco-Gershenson Properties (RPT)
26.02
36.00
38.4
Kimco Realty (KIM)
31.90
43.70
37.0
Tanger Factory Outlet Center (SKT)
28.32
37.80
33.5
Taubman Centers Inc. (TCO)
34.99
46.50
32.9
Developers Realty (DDR)
46.25
61.12
32.2
Federal Realty Investment Trust (FRT)
60.19
78.70
30.8
Inland Real Estate (IRC)
14.27
18.54
30.0
Acadia Realty (AKR)
19.87
25.62
29.0
Simon Property Group (SPG)
75.65
96.01
26.9
Cedar Shopping Centers (CDR)
13.27
16.60
25.0
Kite Realty Group Trust (KRG)
14.63
18.27
24.9
Regency Centers Corp. (REG)
58.26
72.09
23.7
Urstadt Biddle Properties (UBA)
15.57
19.24
23.6
New Plan Excel (NXL)
22.57
27.65
22.5
In terms of stock investments, the REITs
“themselves
were at the bottom of the pack as
AmReit (AMY)
Weingarten Realty Investors (WRI)
37.35
44.85
20.1
a choice except recently. Now it’s been flipped
around.
Equity One Inc. (EQY)
21.61
25.89
19.8
”
— Richard Moore, RBC Capital Markets
Regarding the top performance of Forest City, Maria Maslovsky, analyst of
real estate finance at Moody’s Investors Service, said Forest City “is a very
good company, but the reason they aren’t talked about as much is that it’s family-controlled and they tend to do large-scale, long-term projects. Ten years
isn’t long for Forest City.”
The gains made in retail REITs are below that of the entire REIT sector,
but ahead of other indices in the market. The National Association of Real
Estate Investment Trusts’ Equity REIT index is up over 36 percent for the past
12 months, while the Dow Jones Industrial Average is up about 15 percent and
the S&P 500 is up roughly 16 percent.
The broader, multisector bull market is attributed to several factors, including a decline in fuel costs, improved consumer confidence and low interest
rates. From the perspective of running a big business, current market conditions favor borrowing. And even though many stocks are at 52-week highs,
including many retail REITs, investors see fair valuations. On top of all this,
c-level executives are more confident than ever. These economic conditions
are also the reason why M&A activity is so hot right now.
In regard to retail REITs, the sector’s performance in the third quarter was
top-notch, and helped boost stock prices higher. Simon Property Group, for
example, posted a 27.2 percent gain in third-quarter net income. And since
August, the stock is trading up more than 12 percent.
Regency Centers Corp. delivered robust results for the quarter, with samestore net operating income, rental rate and funds from operations all up significantly. Since August, Regency’s stock is up over 10 percent. Other retail
REITs did similarly well.
As stock prices soar, industry analysts and company executives have continued their debate over the best way to value a REIT. Some analysts and companies prefer stock value modeling based on NAVs, or net asset value, while
others say it’s better to go with the flow of other sectors and create metrics
based on earnings.
Richard Moore, managing director of equity research RBC Capital Markets,
said REIT stocks are increasingly being treated like issues from other sectors. “In terms of stock investments, the REITs themselves were at the bottom
of the pack as a choice except recently,” Moore said. “Now it’s been flipped
around.”
Macerich (MAC)
6.60
8.07
22.3
66.38
79.88
20.3
Penn Real Estate Investment (PEI)
36.53
39.49
8.1
Glimcher Realty Trust (GRT)
23.60
24.99
5.9
CBL & Associates Properties Inc. (CBL)
39.36
41.15
4.5
General Growth Properties (GGP)
46.61
47.54
2.0
Feldman Mall Properties (FMP)
11.49
10.26
-10.7
Mills Corp. (MLS)
40.73
19.39
-52.4
Average: +21.7*
SOURCE: YAHOO FINANCE. *NOTE: AVERAGE IS UNWEIGHTED.
Jon Fosheim, chief executive officer and coportfolio manager of Oak Hill
REIT Management, said during a panel at NAREIT’s recent annual conference in San Francisco in November that values in the current market are by
potential earnings. “But earnings can have a lot of noise in them,” he added.
“Not all earnings are the same.”
Whether REITs decide to get on the same accounting page and issue more
standardized earnings remains to be seen. Meanwhile, REITs are poised for
growth, although the retail sector may decelerate.
“Within real estate, apartments are showing a lot of growth, and office has
picked up. Retail doesn’t look as exciting because it’s very Steady Eddie,”
Moore said. “In ’06, retail real estate is going to get its butt kicked relative to
other property types, but retail earnings haven’t changed.”
In Habermann’s outlook report, the analyst said the valuation gap between
publicly traded stocks and the private real estate sector has narrowed. “But
there still continues to be strong interest on the part of institutional and foreign investors, as well as private equity capital,” he said in the report.
In a research note last week, Ross Nussbaum, senior equity research analyst at Bank of America, said most REITs he met with at the NAREIT conference “do not believe a recession is likely in 2007. Instead, the commonly held
view is that demand will remain steady, or slow slightly from levels seen in
2006.”
Nussbaum said “new supply is being constrained by higher construction
costs, but rising rents in many markets will likely cause more developers to
pull the trigger in 2007. REITs with development pipelines are, in almost all
cases, firing up the construction engines.”
— With contributions from Amy S. Choi
Winick.
Step up
to the best
in retail
brokerage.
655 Third Avenue
8th Floor
New York, NY 10017
212-792-2601
WINTER 2006 /
WINICK.COM
VISIT WINICK REALTY GROUP AT THE ICSC NEW YORK NATIONAL CONFERENCE & DEAL MAKING, BOOTH 155/156.
1
14 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | RETAIL
Redefining Top Mall Attractions
Shopping center owners broaden their definition of traffic generators to include restaurants and homegrown retailers.
Mexican food. There’s the excitement of multicultural offerings. It’s not just the Cheesecake Factory
anymore. So many others are offering such exciting
evelopers have never had qualms about luring
food and drinks.”
coveted retailers to their malls with promises of
Commenting on what has replaced the Gap and
reduced rents and build-out money to pay for store
Old Navy, McCann said, “I think there’s a different
construction.
way of shopping today. People put themselves toFor much of the Nineties, the Gap and Old Navy,
gether differently and look at it all. Macy’s is doing
which spent millions of dollars on advertising, were
a a terrific job since launching nationally. Their custhe recipients of this largesse. In recent years, their
tomer service is phenomenal. Sephora and MAC are
appeal has waned in the face of fashion miscues and
assets.”
poor merchandising.
Unique outdoor lifestyle stores also add
These days, the defining characterisAt Victoria Gardens,
an element of excitement, she said, citing
tics of sought-after retailers has expanded.
Bass Pro Shop acts
Bass Pro Shop as “probably the best retailer
Businesses that are big consumer attractions
as an anchor.
for people who love outdoor sports. We have
aren’t limited to apparel chains or national
a Bass Pro at our Northfield Stapleton mall
retailers. They can be popular restaurants, rein Colorado and they’re drawing all the way
gional specialty stores or discounters.
from Wyoming.”
“Everyone is looking for uniqueness,” said
Some centers are incorporating performNancy McCann, vice president of marketing at
ing arts venues and libraries as anchors.
Forest City Enterprises. “A store that’s unique
“We’re going to let the Gulf Stream Race
has an energy about it and you have a major
Track and Casino be the major anchor for us
draw.”
at the Village at Gulfstream opening in 2008 in
John Bucksbaum, chief executive officer
Hallandale, Fla.,” McCann said. “At Victoria
of General Growth Properties Inc. and chairGardens in Rancho Cucamonga in Southern
man of the International Council of Shopping
California, we have a performing arts center
Centers, said the number of retailers that are
and children’s library.”
key to a center’s success has “grown tremenMechelle Peters, director of corporate mardously, and that’s all for the better. It’s been
keting at the Macerich Co., has different critesuch a strong period for the introduction of
ria for retailers in Macerich’s Luminati diviconcepts from already established retailers.”
sion, which consists of nine upscale shopping
Robert Michaels, president and chief
centers. Malls, like retailers, need to reinvent
operating officer of General Growth, cited
Upscale shops,
themselves, she said. “We’re going back and
Abercrombie & Fitch, abercrombie, Hollister
such as Gucci,
changing things at Biltmore Fashion Park in
and Ruehl as being “every bit as strong as
Louis Vuitton and
Phoenix. We have Arizona’s first Calypso bouGap” was in the Nineties. And American Eagle
St. John, add a
tique. We think Calypso will set the tone for
Outfitter’s Martin + Osa and the Spanish relayer of luxe to
International Plaza.
other edgy stores.”
tailer Mango look promising, he said.
Among the retail magnets at Macerich cen“We’ve watched Uniqlo for a long time in
ters are Anthropologie, Sephora, Apple and
Japan,” Michaels said. “They’re very good. We’re
Crate & Barrel, Peters said. “Up and comtalking to them about a number of things.”
ers are Lucy and White House/Black Market.
Some tried-and-true names at the top of
They’re big traffic draws.”
Bucksbaum’s list include Coach, Apple, J.
One area that’s fallen out of favor someJill, Chico’s, Ann Taylor, Talbots, Cheesecake
what is home furnishings and home decor.
Factory and PF Chang’s.
As recently as five years ago, Restoration
“Not all retailers are created equal,” he
Hardware, the Bombay Co. and Pier 1 were
said. “There’s a group of stores that’s imporhigh on leasing agents’ lists. With the housing
tant to a center and there always will be. They
market chilling, many consumers have shiftwill always change. There’s no question that a
ed the focus from their homes back to themretailer such as Gap — and The Limited before
selves.
it — were important to the success of a project.
“People aren’t moving to new homes so
They were the leading retailers, so the economthey aren’t that focused on shopping for home
ics of those leases weren’t as strong as others.”
products,” Taubman said. He added that mall operaThat was a sacrifice malls were willing and are owners can have the upper hand in negotiations.
Sometimes a hot restaurant can play the role of tors can’t get too swept up in consumers’ shifting alstill willing to make in exchange for the store’s abila top retailer in terms of attracting shoppers. “At legiances because everything is cyclical.
ity to attract consumers.
“It’s really about how you put the mix together,”
“The Gap itself still does a substantial amount of International Plaza in Tampa [Fla.] we do over $70
he explained.
business and is still an important store,” said William million in food sales,” Taubman said.
The group of hot retailers has multiplied,
Forest City’s McCann agreed. “Restaurants have
Taubman, chief operating officer of Taubman Centers
Inc. “I don’t know that there’s a singular store the become key anchors in today’s open-air or closed Bucksbaum said, and that’s all for the better. “There
way the Gap was eight years ago. The business has centers,” she said. “It’s been proven in research that are many people now that make a center vibrant, so
people are eating out four times a week. Food is one our options have expanded tremendously,” he said.
splintered.”
Taubman now sees a strong focus on contempo- of the great assets to a shopping area. Today peo- “There’s probably less volatility today. That’s one of the
rary. “This is an area of the market that’s experienc- ple want wonderful Brazilian food, Asian food and beauties of the business. It keeps things balanced.”
By Sharon Edelson
D
The Village at Gulfstream in
Hallandale, Fla., will have 400,000
square feet of retail when it opens
next fall.
ing expansion,” he said.
Retailers in demand include Barneys New York
and Cusp, a concept developed by Neiman Marcus;
regional players such as Scoop and Intermix, which
are expanding to other U.S. cities; and denim brands
True Religion, Adriano Goldschmeid and Replay.
Taubman said offering financial incentives to lure
popular retailers is less customary. “There’s not a lot
of space available in the best malls,” he said, noting
that when openings are scarce in top centers, mall
Victoria Gardens’
dining options
include Kabuki and
Lucille’s Smokehouse.
16 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
ICSC PREVIEW | ISSUES
Select Developers Protect the En
in October on the former Denver International Airport Site, is the first retail town
center to achieve LEED status.
The 1.2 million-square-foot Northfield Stapleton project was given the silver
certification based on the use of a sustainable site; water, energy and atmosphere
efficiency; use of materials and resources, and indoor environmental quality.
Though the development team, led by Jon Ratner and Brian Levitt, kept mum
on the premium they paid to develop a LEED silver property, they did hint at the
expected returns on the investment, including a cash incentive through a government energy savings program.
“We have a triple bottom-line approach,” said Ratner, the company’s director of
sustainable initiatives. “We’re not just looking at the financial return of our properties, but also at the environmental and social impact. We look at people, planet
and profit.”
Northfield Stapleton was built under the LEED Core & Shell guidelines (see
glossary on page 9.) But the developer also steered tenants toward more environmentally friendly stores with its sustainability tenant incentive program. The program grants cash incentives and an energy allowance for tenants who achieve certain levels of sustainability. It also offers marketing incentives.
Other developers are taking their own baby steps toward LEED. But the up-front
costs to build sustainably is halting many in their tracks.
“If you can marry what’s good for the environment with what’s good for shareholders, it will work,” said Robert Taubman, chairman, president and chief executive officer of Taubman Centers. “It needs to have an economic incentive and a good
return on capital. It can’t just be about good deeds.”
Others echo Taubman’s concerns on price.
“Green development is at the forefront of all commercial development discussion today,” said Dan Hurwitz, chief
investment
officer and senior executive vice president at
Costs & Savings
20-Year Net
Developers Diversified Realty. “But the challenge is finding
Per Square Foot
Present Value
Energy
$5.80
a way to do it that is cost-effective so that the returns are
Emissions
$1.20
commensurate with the investment. We’re not at the point of
Water
$0.50
doing it yet.”
Operations & maintenance
$8.50
Resistance to green development may be more to a perProductivity & health benefits $36.90 to $55.30
SUBTOTAL
$52.90 to $71.30
ceived fiscal hit than an actual one.
Extra cost to build green
($3 to $5)
According to The Costs and Benefits of Green Buildings,
TOTAL 20-YEAR NET BENEFIT
$50 to $65
a watershed report on the costs of green development published
in 2003, the average premium for green construction is
SOURCE: CAPITAL E ANALYSIS
less than 2 percent — not the oft-quoted 10 percent — which
translates into roughly a $3 to $5 premium per square foot, depending on the number of green systems in the building. For a platinum LEED certification, which requires the most rigorous sustainability levels, the average premium is 6.5 percent.
When talking about a 300,000-square-foot regional mall, this is certainly a steep
cost. Ultimately, though, the up-front investment yields considerable savings. Given
that green buildings generally use 30 percent less energy than a traditional building, and energy costs are constantly increasing, the reduced consumption translates
to an average of $5 per square foot over the life of the property, equal to or more
than the average additional cost associated with building a green product, according to the study.
Thus, the economic incentive is hefty enough to motivate even the shrewdest
developers to move toward sustainability.
Simon Property Group, which recently won the National Association of Real
Estate Investment Trusts and Environmental Protection Agency’s Leader in the
Light award for its energy and natural resource management programs, plans to
build at least one of its projects “100 percent green,” said David Simon during a
conference call.
By Amy S. Choi
“We think the cost per square foot will be offset by the savings we may have on
uildings are an environmental challenge. They cover green land, devour energy the utility costs. We’ve got a very competent team in this area that is very focused
and eat up natural resources from wood to water. Commercial real estate ac- on looking at all sorts of alternative energies,” said Simon.
A developer doesn’t have to go LEED crazy in order to better serve the environcounts for nearly 50 percent of all greenhouse gas emissions and energy consumed
ment and incur savings, either. Rehabilitating older buildings can be much less
in the U.S. annually.
expensive than focusing on LEED certification for new development.
Malls are among the worst offenders.
General Growth Properties, for example, has 210 million square feet of comSlowly, retail developers are changing how they think about the environment,
partially because state and local governments are raising the requirements for real mercial space across the country. It is hoping for LEED certification for its planned
estate operators — in fact, greening is often more a political reality for developers community in Summerlin in Las Vegas, but has broader plans for its existing portfolio. As part of its Global Green Project, it hopes to reduce its electrical consumption
than it is a choice.
But most significantly, developers are more interested in building in an envi- by 10 percent, which is equal to the energy consumption of 10,000 U.S. homes for
ronmentally friendly way because it protects their bottom line — in addition to the the year and equals $9 million in savings in operating costs. And while much of the
technology is expensive, management sees them as necessary outlays.
environment.
“There are a lot of things we haven’t done because we have felt prohibited by
Right now, few developers fully embrace green building, which involves using
environmentally responsible construction practices to build high-performance the expense,” said John Bucksbaum, ceo of General Growth Properties. “That said,
structures that minimize their use of natural resources and impact on the environ- we look at every option. I won’t allow ourselves to be curtailed only because of
ment. However, nearly all developers are considering greening their existing port- economics.”
The company has also installed 5.6 million square feet of Sarnafil’s EnergySmart
folios and incorporating at least a few green strategies into new properties.
Developers are doing everything from replacing traditional lightbulbs with more Roof, a cool roofing materials system designed to minimize smog and global warmefficient LED bulbs to improving their recycling management programs and add- ing and invested $15 million in new HVAC systems to replace inefficient older moding solar panels on rooftops to supplement their energy supply. According to the els. It expects to recycle 50 percent of its waste by next year.
Westfield Corp. is debating a solar-power program for its exterior lighting. The
U.S. Green Building Council, a nonprofit advocacy group devoted to educating and
encouraging developers to use sustainable building practices, the market for green company has already transitioned to a solar program at two centers in California.
building products and services hit $7 billion in 2005, a nearly 40 percent increase Westfield has also undergone an interior and exterior lighting retrofit program,
which is taking place in 23 centers nationally, with 12 properties completed in
from a year earlier.
Since 2000, roughly 500 million square feet of new commercial property has been Southern California and New Jersey. Finally, it is piloting a “weather track” smart
certified by the USGBC with the Leadership in Energy and Environmental Design irrigation system in San Diego, which processes weather forecasts and adjusts its
designation, which denotes a high-performance building that meets certain stan- irrigation schedule accordingly.
“The industry is walking the line between environmentalism and cost,” said
dards of sustainability. Little of the LEED-certified property is retail.
The $7.8 billion Forest City Enterprises is the first of the major retail real estate Bucksbaum. “But I don’t think we can only look at the returns of being green today,
investment trusts to go beyond greening their properties and invest fully in green or tomorrow, or one year from now. What is the payback in three years, five years? I
development practices. The company’s Northfield Stapleton project, which opened think the most important question is, what is the cost to us if we don’t do this?”
Artist Patrick Marold’s
sculpture at Northfield
Stapleton recycles old
airplane parts.
Green by the Dollar
Finding Green in Green
B
WWD, MONDAY, NOVEMBER 27, 2006
17
WWD.COM
vironment – and Profits
Mom, Pop and Wal-Mart Go Green
B
rooklyn Industries and Wal-Mart Stores
Brooklyn
couldn’t be any more different from one
Industries’
another, but both retailers have made the word
Chelsea store
“sustainability” their mantra.
in New York.
Brooklyn Industries got its start designing
products out of recycled materials. As it grows
its retail business, the boutique design firm is attempting to stay green. Wal-Mart, which became
the world’s largest retailer by offering “everyday
low prices,” is pushing ahead with a global environmental initiative that involves experimental
store concepts in its massive portfolio.
How this boutique design company with an
edgy fashion line for the hipster set stacks up
against the giant of all giant retailers is a study
in contrasts. What may surprise is that its sustainability efforts, while vastly different in scale,
are not dissimilar in intent.
“Our emphasis has always been on artistic
creativity, but much of our design coincides with
the environmental movement,” said Lexy Funk,
president of Brooklyn Industries. “We see our
Diametrically opposed to Brooklyn Industries on the fashcustomers willing to pay a premium for both.”
ion, retailing, financial, philosophical and cultural spectrum
Brooklyn Industries is a baby in retail terms. The brain- is Wal-Mart Stores. The world’s biggest retailer and the counchild of Funk and Vahap Avsar, the Williamsburg, Brooklyn- try’s largest corporate electricity user maintains more than
based business grew out of an initial effort designing and sell- 7,000 stores worldwide, just one of which dwarfs the entire
ing messenger bags made out of recycled billboards, less out portfolio of Brooklyn Industries. None of Wal-Mart’s traditionof a desire to recycle than to incorporate unique materials al stores are particularly well known for their architectural
into their designs.
detail or support of local artisans and small vendors.
Now it is one of Inc.’s 500 Fastest Growing Private
Still, the company that today defines mass consumption
Companies of 2006 and boasts an annual revenue of $4.7 mil- and real estate sprawl has launched an offensive for suslion and more than 350 percent growth in the past three years. tainability across all of its business practices, most notably
And the recycling concept has stuck. The retailer’s newest real estate.
store, in the Chelsea neighborhood of Manhattan, reflects the
At the center of Wal-Mart’s push are two experimental
company’s current four-R philosophy of recycle, reuse, repair stores, in McKinney, Tex., and Aurora, Col. Both stores utiand reduce.
lize solar photovoltaic panels and wind turbines to generate
As a several-million-dollar company, compared with the electricity and reduce the pressure on the local power grid
$300-plus billion Wal-Mart, Brooklyn Industries can’t af- and have installed compact fluorescent lightbulbs, which
ford the rigors of Leadership in Energy and Environmental require less electricity, in the stores. The company has kept
Design certification. But it does what it can in the construc- mum on how much it has invested in the real estate, but says
tion process, while maintaining the edgy, local focus of the the energy saved by the solar, wind and water systems in the
company.
McKinney store alone on a normal business day could power
The checkout register in its Chelsea store was made from nearly 4,000 American homes for 24 hours.
scraps from the company’s own wood shop by Scrap Pile, anAcross its entire real estate portfolio, Wal-Mart plans to
other Brooklyn-based design company, while the wall units invest $500 million a year in energy-saving technologies and
and merchandising system were built entirely using scraps cut energy consumption in its worldwide portfolio by 30 perand leftover wood from renewable forests in Finland. The cent. The retailer is touting sustainability company-wide and
floors were made from wood by a lumber company being cer- has said it will do everything from slashing gasoline use in
tified as sustainable by the Forest Stewardship Council, and its trucking fleet and using more hybrid trucks to pushing its
are roughly 30 percent more expensive than a traditional vendors to adopt sustainability practices.
flooring system. These are all practices abiding by the central
Critics point out that, with its massive portfolio, greentenets of LEED philosophy, if not comprehensive enough to ing two stores is hardly enough to address the impact Walqualify for certification.
Mart’s real estate has on the environment. Still, it is a 500,000“We can’t do everything we want, mainly because we can’t square-foot step in the right direction. As Brooklyn Industries’
afford it,” Funk said. “A lot of the environmental tactics and Funk notes, “If we can make our stores more environmentally
certification processes are very time and capital intensive, conscious in some way, even if it’s just one or two stores a
neither of which a small retailer has. But we want to engage year, it’s better than not thinking about it at all.”
where we can.”
— A.S.C.
A Green Glossary
Green
Anything safely sourced from the
environment, whether materials
or energy. Green power, for example, is electricity generated by
solar, wind or geothermal methods, while green development
uses these resources to minimize
energy consumption and a building’s impact on the environment.
Often used interchangeably with
“sustainable.”
Sustainable/Sustainability
Any system, resource or material
that functions or can be utilized
and renewed without detracting
from the natural environment.
Sustainable development, therefore, might use wood from forests
that can replenish themselves
and aren’t at risk of depletion
and install water systems that
collect and utilize rainwater as
part of an irrigation system that
then purifies the water to return
it to the environment.
USGBC
The U.S. Green Building Council
is a nonprofit organization of
nearly 7,000 member groups devoted to environmentally and socially responsible development
of buildings and communities.
LEED
The Leadership in Energy and
Environmental Design designation is offered by the USGBC to
high-performance green properties that meet varying levels of
sustainability. Approximately
500 million square feet of commercial property is currently
LEED-certified at either the
platinum, silver or bronze
level. Engineers, architects and
builders that incorporate sustainability practices into their
development can also be LEEDcertified.
Core and Shell
In a commercial building, the
“core” operational systems include heating, ventilation and
air conditioning, while “shell”
construction includes walls and
roofs. Because a retail center requires so many different operators within a single space, mall
developers seeking LEED designation often opt for a core-andshell certification, which marks
their commitment to sustainable
practices in the space that they
themselves control.
Photovoltaic
Photovoltaic panels are able to
generate electricity when exposed to either sunlight or some
other form of electromagnetic
radiation. Often used on building rooftops in order to supplement the energy that the property must draw from the local
power grid.
Photovoltaic panels
capture solar power at
Wal-Mart’s Aurora, Colo.,
experimental store.
Wind Turbine
The machinery used to harness
wind energy. Turbines are often
placed on rooftops or in parking
lots and used either to alleviate the property’s drain on the
power grid or to fuel irrigation
and other sustainable systems
on the property.
— A.S.C.
18 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | LUXURY
Leveraging Relationships
How a real estate consultant taps sources for market intelligence.
By Arthur Zaczkiewicz
NEW YORK — The offices of PBS Realty Advisors LLC are
buzzing with energy. Real estate deals are wrapping up, while
others are just getting started.
Down the hall, several executives huddle together discussing clients and recent business trends. Laura Pomerantz is
the one balancing a BlackBerry, cell phone, stack of papers
and a cup of peppermint tea in her arms.
“The tea gives you energy,” Pomerantz said, smiling. “Not
like I need more energy.”
Indeed. Pomerantz, principal and founding partner of
the six-year-old company, is bursting with energy. Just ask
her clients, which include firms such as Bloomberg LLP,
Abercrombie & Fitch, Giorgio Armani and David Yurman,
among others, many of them luxury fashion retailers. She’s on the job — thumbs and fingers working
furiously on her BlackBerry — from about 7 a.m.
until 10 p.m.
“I get about 200 e-mails a day,” Pomerantz said.
“And it’s not spam. These are clients and sources
with whom I’m in contact. I have to respond.”
And there’s the key to the success of PBS: The
company works hard to develop and nurture longterm relationships with clients. For Pomerantz,
this not only means building valuable industry
sources, but having the power to tap these sources
for market intelligence.
“There is no one who she can’t get on the phone,” said Betty Ende, senior
managing director at PBS. Pomerantz has more than 4,000 contacts in her virtual
Rolodex.
PBS, headquartered at 230 Park Avenue here, offers full-service real estate
consulting in a variety of disciplines including office, retail, distribution centers,
acquisition and disposition. Before founding the company with John Brod and
Morton Schrader, Pomerantz honed her real estate management skills at brokerage Newmark & Co. and landlord S.L. Green. Prior to that, Pomerantz served as
executive vice president at The Leslie Fay Cos. Inc.
Although Pomerantz has been in the real estate business for more than a decade, she’s not the typical broker or consultant. Before meeting with a client or
potential client, Pomerantz does a lot of homework, including compiling marketspecific data such as competitive analysis, street locations, mall locations and
consumer demographics.
“Our job is to be very familiar with different markets and the level of consumers there,” Pomerantz said. “We also know what is in the development pipeline
in those markets.”
Her ability to create forward-looking market analysis also sets Pomerantz
apart from the competition. “It enables clients to strategize a
market,” Pomerantz added.
Building strategy also takes time — and space.
“The first thing I ask a client is how big their conference room
table is,” she joked. “I ask, because I then make a presentation
to them that fills the entire table.”
Pomerantz avoids PowerPoint presentations for a more personal, interactive approach with clients. Her presentations are
designed to promote a lively discussion with the client.
For example, on this particular day, she was working on a
presentation pitching a retail expansion plan for one of her fashion clients, who asked to remain confidential. Pomerantz spread
a poster-size map of the U.S. across the conference table. The
map included the client’s current retail locations as well as the
competition, and possible future sites.
Along with the map, Pomerantz and Ende had a printout of
more detailed market data, including shopping centers, retail
districts in cities and malls where the client might fit in well.
Laura
Pomerantz and Ende then rolled up their sleeves and went to
Pomerantz
work analyzing each street mall, weighing the pros and cons of
expansion.
“A good part of what we do is detective work,” Pomerantz said.
Clients also often come to PBS to dispose of stores. Pomerantz empathizes
with retailers going through an asset disposition. It can be an emotionally taxing
experience for all. But Pomerantz reassures them that they are “doing the right
thing, and the resources can be deployed more productively.”
“Companies need to be constantly pruning their real estate,” she said. “You
need to try new things and take risks. It’s how a company grows.”
Pomerantz admits the business can be stressful. The phone keeps ringing, and
in 45 minutes, she received more than 35 e-mails. “There are many frustrating
days, but overall, it has been good, and I feel extremely fortunate,” she said.
The frustration is far from enough to stall the company’s growth. In August,
PBS was named a partner of Oncor International, which is the fifth-largest real
estate network in the world. Last month, Oncor was acquired by Realogy Corp.,
the largest real estate firm in the world. The partnership with Oncor effectively
extends PBS’ reach in the global market.
In addition to running her business, Pomerantz is committed to the arts and
the local community. Her philanthropic work includes serving on the board
at Carnegie Hall as well as the Richard Tucker Foundation. At Carnegie Hall,
Pomerantz chairs the special events committee, which includes a fund-raiser
aimed at offering affordable tickets to lower-income families.
EDITOR’S NOTE: On the Job with Laura Pomerantz is the first in a series of stories
where WWD goes behind the scenes — in corporate offices, on trade show floors and
in the market — to profile a notable industry executive.
Luxury Retailers to Increase Global Expansion
By David Moin
T
he luxury business keeps rolling along, although not without some potential
bumps in the road.
Executives see a dip in sales gains this year and aren’t quite so bullish about
expansion, according to a survey commissioned by the Lumenati division of
The Macerich Co. and completed in October. The luxury sector is still very
healthy, and executives are upbeat because of the rising stock market, higher
corporate profits and consumers who are increasingly seeking better quality
products and are trading up. However, the findings suggest there is a bit of caution in the air.
Macerich selected senior luxury executives to participate in a wide-ranging
online questionnaire conducted by the Behavior Research Center of Phoenix.
Forty-five companies responded, including Burberry, Ferragamo, Godiva,
Gucci, Jimmy Choo, Kate Spade, Theory and True Religion.
Among the key findings:
● Overexpansion has become an issue.
Fifty percent of the respondents said some
luxury brands have diluted their value with
too many locations; 27 percent disagree and
23 percent said they were unsure.
● Those who are expanding in the U.S.
project an average of 19 openings next year,
compared with the 21 that were planned in
2006. However, international expansion will
be up by 20 percent.
Gucci participated in a survey on
● On the East Coast, 42 percent of the
growth in the luxury sector. The
respondents said they anticipate one to three
findings suggest some brands have openings in the region next year; 16 percent,
scaled back expectations..
four to five; 9 percent, six to 10, and 11 percent
project 11 or more. Twenty-two percent of the respondents see no openings.
● On the West Coast, 52 percent of the respondents said they would open
one to three stores next year; 16 percent, four to five; 7 percent, six to 10, and 9
percent predict 11 or more. Sixteen percent said they would not open any new
units.
● In the Midwest, 47 percent of the respondents foresee one to three openings; 11 percent, four to five; 2 percent, six to 10, and 7 percent, 11 or more.
Thirty-three percent see no openings.
Factoring into expansion plans is the outlook for sales growth, which slips
to 12.8 percent this year from 14.9 percent in 2005. The fourth quarter will also
take a dip, with sales seen rising 11.9 percent this fiscal year, compared with
14.6 percent a year ago.
Luxury retailers said the biggest potential boon for holiday sales would be
a continued upturn in the financial markets. The stock market has been strong
and big Wall Street bonuses are expected, which could influence holiday spending before the bonuses actually get distributed.
Other major factors affecting holiday sales in the luxury sector are decreasing oil and gas prices, which were cited by 29 percent of the respondents; a
reversal of the slowdown in home sales and construction, cited by 16 percent,
and a reduction in Middle East turmoil, cited by 9 percent.
The big story of 2006 was consolidation and changes in the department store
sector, notably the Federated-May merger, which the luxury executives view
as proceeding smoothly and resulting in placing a lot of real estate in play.
Another big development was the sale of the Neiman Marcus Group to Texas
Pacific Group and Warburg Pincus.
One executive was quoted as saying, “The successful consolidation of
Federated Stores with May Company has allowed developers to redeploy unproductive space in malls, spurred the development of outdoor environments
to accommodate additional lifestyle tenants...and helped differentiate the top
centers from the middle-of-the-road, junior-oriented properties.”
Point of Contact
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20 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
WWD.COM
ICSC PREVIEW | MARKETS
Black Gold Transforms Calgary
Wealth, employment and a hunger for style surge as the oil industry reinvents this pioneer town.
By Mina Williams
Uptown 17th Avenue provides an alternative to
Holt Renfrew, below. Below left: Just one of the
new projects in Calgary.
PHOTOS BY MINA WILLIAMS
CALGARY, Alberta — Snuggled into the leeward side of the Canadian Rockies,
surrounded by cattle ranches and fields of soybeans, Calgary appears to be the
sort of city where boots and beer are more de rigueur than Burberry and burgundy. The discovery of oil and international investment in the energy sector,
however, have not only boosted employment and spurred retail sales growth, but
opened the prairie’s fashion horizon.
Pipeline, energy production and distribution companies are just a few of the
businesses that have flocked here as the
economy grows by leaps and bounds with
each new energy source unearthed. The
city boasts the highest number of corporate headquarters in Canada, up 37 percent between 2000 and 2004, according
to Calgary Economic Development. This
surge has spurred retail sales: Average
annual retail sales growth is slightly
more than 8 percent, outpacing Calgary’s
nemesis, Edmonton, at 6.8 percent, and the
center of Canada’s economic universe, Toronto, at 5.9
percent, according to Statistics Canada. Housing prices
have surged 50 percent, according to the Calgary Real
Estate Board.
Cranes can be spied from almost every vista around
Calgary. Mixed-use, retail and condominium properties
are emerging in the downtown core, in close-by neighborhoods and in the suburbs.
The Hotel Arts Building in southwest Calgary epitomizes the sizzling construction scene. This $100 million,
65,000-square-foot redevelopment project combines a
three-story office and retail structure with a 40-story,
200-unit residential tower above and two levels of underground parking below. Real estate developer John
Torode is overseeing this project and another just a few
blocks away, the Arriva, a 34-story tower of residences,
retail and office space, and restaurants. Torode plans a
450,000-square-foot hotel and office project just west of
Arriva, and another mixed-use project, Ramsay Crossing,
of 3 million square feet.
“With the development downtown, in particular with
office space, Calgary is firing on all cylinders,” says Adam
Legge, director of research and business information of
Calgary Economic Development. “The energy sector is
the dominant driver fueling job growth, income growth,
wealth and opportunity for personal consumption. We are
seeing this trend creating growth in the retail segment. Just when you think you
have enough retail space, another project kicks off.”
A market report by real estate broker CB Richard Ellis states that more than 2.7
million square feet of retail space is currently under construction in Calgary.
The booming economy has created a new group of Calgarians who want fashion
and are so hungry for it they are traveling to New York or Palm Springs to shop.
There are some stylish offerings in Calgary. Holt Renfrew is the fashion Mecca
of the Canadian prairie. Located in the Core, downtown’s mall complex, this
trilevel emporium is part of a nine-unit, high-end chain with stores throughout
Canada. The Calgary unit offers Burberry, Prada, Gucci, Armani and Michael
Kors in women’s clothing and Loro Piana, Paul Smith, D&G and Ralph Lauren in
men’s. It also offers Max Mara, DKNY, Theory and Elie Tahari.
The shift in the Calgary market has caused Holt Renfrew to expand the number of luxury designers it offers. “The business has changed drastically as more
aspirational customers are coming through our doors in search of both fashionforward and classic luxury merchandise,” said Barbara Atkin, fashion director
for the Toronto retailer. “There is no price resistance.”
“This is a younger, more fashion-aware crowd,” she continued. “It’s new
money and those customers want to spend on the best brands available. They
want to enjoy the momentum.”
This is especially true downtown, where polished twentysomethings duck
into shops and nearby restaurants. In Calgary’s downtown mall, independent retailers showcase labels of Façonnable, Hugo Boss, Canali, Armani and
Ermenegildo Zegna, and Stuart Weitzman heels show up throughout.
Restaurants dominate many of the storefronts around the Core. Trendy
Belgo and the Tribune are popular, but Calgary also strongly supports casual restaurants and pubs such as Earls, Cactus Club Café and Joey Tomato’s
Mediterranean Grill.
Calgary neighborhoods offer high-end furniture stores, home furnishing boutiques, accessories and custom appliance stores. The area surrounding Uptown 17th Avenue Southwest, just south of downtown, holds the most
promise for contemporary fashion seekers. Sleek and sporty shoppers, clad in
Msiamo, strut the street munching on Bernad Callebaut truffles. Boutiques nod
to Canadian designers such as Vancouver’s Catherine Regehr, and international
selections come from Versace, Luisa Cerano and Annette Görtz. Other shops,
like Primitive, target a younger audience with Nicole Miller, Stella Forest and
Filippa K.
“Uptown 17th has always been the popular place to come to,” explains Clare
Edwards, owner of the upscale boutique Park Avenue. “The main change in the
past couple of years has been the shift away from the shopping village concept,
with a collection of independent retailers under one roof, to more boutiques
that have actual storefronts. The economic boom has also brought new people
into Calgary that are just now learning about the neighborhoods.”
As a result, retailers report they are just now seeing real sales growth in the
fashion sector. “They have decorated their homes and now they are looking for
fashion,” said Edwards. “This fall has been very good for us.”
Calgary’s suburbs are filled with typical shopping malls, including North
Hills Shopping Centre in the northwest section, Chinook Centre in the southwest and Avenida Shopping Centre and Southcentre Mall in the southeast.
These shopping spots are anchored by Sears and the Hudson Bay Co. and house
moderate retailers such as Banana Republic, the Gap and Roots.
Still, certain factors prevent this oil-boom town from opening its arms to designer outposts. First, Calgary real estate owners enjoy a vacancy rate hovering
around 2 percent, according to CB Richard Ellis. This is creating a tight situation for shop owners trying to break into the market. Rental rates are reaching
the point of “pushing the boundaries of what is economically viable and we are
experiencing…some resistance from tenants,” said the company. Rental rates at
regional shopping centers range from $30 to $100 per square foot.
And despite the forward-moving population, fashion items and luxury goods
are not being wholly embraced by most of the residents.
“The problem in Calgary is not the lack of income,” explained Philip Boname,
president of Urbanics Consultants, a Vancouver company that specializes in regional shopping center studies. “Calgary still has a frontier town mentality.”
In short, most residents prefer backyard barbecues and comfort to fine dining and fashion.
But clearly, Calgary has been changing during the last two years of the oil
boom. Boname predicted that the relaxed culture would change.
“The casual inclination will change, particularly downtown,” he said. “There
will be more high-end shops looking at the heritage buildings and the streets
flanking pedestrian malls will have a transformation. There will be a boom in
retail as well as high occupancy and high rental rates.
“Calgarians are enormous travelers,” Boname added. “It is nothing for them
to buy haute couture out of town. There is a huge outflow of dollars that could
be captured.”
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PBS Realty Advisors LLC
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22 WWD, MONDAY, NOVEMBER 27, 2006
SECTION II
ICSC PREVIEW | INSIDE LOOK
Penney’s Progress: Expansion an
National retailer’s aggressive growth strategy looks beyond the mall, without abandoning it, in an effort
which it plans to open stores, with 20 percent of the units located in communities
with populations of 80,000 to 100,000 that it says are under- or unserved by mid-tier
.C. Penney Co. Inc. understands that enticing busy consumers who crave acces- retailers and that also are poised for growth as more middle-income consumers
relocate seeking more reasonable costs of living.
sibility begins with making decisions on location and size.
So far this year, Penney’s has opened 28 stores, including 23 off-the-mall stores,
Those are starting points in Penney’s multipronged drive to become the domi17 of which were freestanding units,
nant midtier U.S. retailer, targeting the
with locales in smaller communities
powerful demographic of women ages 30
such as Dardenne Prairie, Mo.; North
to 54 with household incomes of $35,000 to
Conway, N.H.; Olean, N.Y.; South
$80,000.
Jordan, Utah; Murfreesboro, Tenn., and
Penney’s, which posted sales of $18.7
Trussville, Ala. The majority of new
billion in 2005, is on a streak that saw
stores are in the top 20 U.S. population
third-quarter earnings beat Wall Street esmarkets, including areas around Dallas,
timates. Management said the chain will
Chicago and Denver.
meet growth targets for 2009 by next year.
About 80 percent of the new stores
The company’s almost 1,000 units at malls
will go into markets that typically have
across the country are in the midst of a re“populations in excess of one million
vitalization effort that aims to put a fresh
people and individual store-trade area
face and new attitude on Penney’s doors,
population in excess of 300,000 people,’’
including new Sephora boutiques frontDastugue said. “About 50 percent of the
and-center as the chain reenters beauty in
—
Myron
E.
Ullman
3rd,
J.C.
Penney
Co.
Inc.
large stores will be in the top 20 metroa big way.
politan markets....Clearly, adding multiThe retailer is also looking beyond the
ple stores in large markets provides the
mall with a broad move into new territory
opportunity to gain market share’’ and
— freestanding stores in previously unleverage expenses.
tapped areas of the U.S., including comPenney’s executives have said the
munities of fewer than 100,000 people that
company will continue to acquire mallare near major population centers.
based stores in attractive locations
It’s part of an accelerated growth stratwhen opportunities arise. For example,
egy led by chairman and chief executive
Penney’s plans to open a 150,000-squareofficer Myron E. “Mike” Ullman 3rd, who
foot store in Main Place Mall in Santa
has said that Penney’s plans to spend
more than $3 billion and open 150 stores
during the next three years — mostly offthe-mall.
“We have a unique advantage in that
our off-mall department stores provide a
neighborhood presence that offers convenience and accessibility for midweek shopping while complementing our mall stores,
which continue to be a weekend and holiday shopping destination,” Ullman said.
He noted that the chain had embarked on
its most aggressive store-opening program
in more than 25 years.
Penney’s has concluded that off-the-mall stores make sense given that new
shopping center construction has stalled. In addition, consumers have expressed
the desire for a faster and more focused shopping experience that’s close to home,
easier to navigate than a big mall and even equipped with Internet kiosks that
link Penney’s $1 billion Web site to its stores. In essence, the 1,037-unit Penney’s is
bringing its stores closer to shoppers’ homes and highlighting shoppers’ lifestyles
in its merchandising mix.
“Off-the-mall stores are a very integral part of our new-store growth plan,”
said Michael Dastugue, senior vice president of property development. “There
are so few new malls being built in the U.S., and we want to be located where our
customers live and want to shop. It’s part of our plan to focus on our customers’
lifestyles.”
The freestanding stores represent a model that is expected to shape the future, though Penney’s is by no means turning away from mall-based business. The
company now has 45 off-the-mall stores. Executives said the chain intends to grow
sales and gain market share by opening in regions with rising populations and
those with high growth potential.
“The whole off-the-mall concept as it relates to department stores really has
great value to consumers and to businesses,’’ said Alan Shor, founder and president of The Retail Connection, a consulting firm in Dallas. “There are very few
malls being built and there’s so much retail consolidation going on at the malls
that are out there that off-the-mall stores become even more viable options. It’s a
great way for retailers to grow their businesses and [it] creates a new avenue of
reaching consumers.”
Penney’s plans to spend about $250 million annually through 2009 for existingstore renovations that will create better lighting, wider aisles, Internet kiosks,
centralized service and checkout areas, more enticing and focused trend presentations and a focus throughout on customers’ lifestyles, from home to fashion. The
retailer’s mall-based stores average 150,000 to 200,000 square feet compared with
100,000 square feet for freestanding units.
The chain has designated more than $1 billion a year from 2007 to 2009 for
capital improvements, including $600 million for new-store construction, $75 million for technology and $75 million for direct logistics — along with the renovation
expenditures.
The long-range goal is to have 75 percent of the chain’s stores new or renovated by 2009. Penney’s revved-up construction and renovation program is expected to have a net effect of about 3 percent square footage growth per year
Sephora boutiques are a
starting in 2007.
major Penney’s initiative.
Penney’s has identified 400 under- or unserved markets across the U.S. in
By Rusty Williamson
J
Our off-mall department stores
“provide
a neighborhood presence that
offers convenience and accessibility
for midweek shopping while
complementing our mall stores.
”
WWD, MONDAY, NOVEMBER 27, 2006
23
WWD.COM
d Renovation
Performance of J.C. Penney
Gets Noticed on Wall Street
to best serve consumer needs.
Ana, Calif., a takeover of a former Robinsons-May unit.
“Our in-house research department studies U.S. markets and demographic trends and helps guide us in our choices of which markets to enter,” Dastugue said. “We also work closely with real estate
developers across the U.S. — and sometimes they come to us first
asking us to be the first tenant in a planned lifestyle development or
shopping enclave.
“We’ve also gotten the reputation of being first to the playing field
and tapping into underdeveloped and/or unserved markets, so now
we’re also getting calls from other specialty chains asking us which
areas of the country or which particular part of a city we might be
interested in,’’ he said. “They want to follow our initiative, which reinforces our leadership mind-set.”
Penney’s main off-the-mall format is on a single level that places women’s apparel, including several new private brands such as
Ambrielle lingerie and East 5th ready-to-wear, front and center, just
behind the approximately 2,000-square-foot Sephora beauty boutiques located at the front door — just as they are at Penney’s mallbased stores.
Penney’s has also recently installed almost 40,000 point-of-sale terminals that are linked to its Web site jcpenney.com, which generates
more than $1 billion each year.
The off-the-mall stores generate higher sales per square foot than
mall-based stores and also register more frequent customer visits.
Penney’s off-the-mall stores can generate as much as $250 per square
foot after one fiscal year, compared with $157 per square foot average for
all stores, including mall-based units, up 23 percent from five years ago.
“Our excellent results over the last three years have given us the
confidence that our new-store program can be dramatically expanded
to generate profitable growth at J.C. Penney,’’ Dastugue said. “The acceleration of growth at J.C. Penney moves us up to a position of leadership with the department store industry.”
J.C. Penney Store Openings, 2006
By Vicki M. Young
R
eaching its long-range targets two years ahead of plan has made shares of J.C.
Penney the turnaround story and holiday pick for 2006. It expects to hit its goals
by 2007 instead of 2009, and Wall Street is lauding its accomplishments both in its real
estate portfolio and in sales.
According to Citigroup Global Markets analyst Deborah Weinswig, who has J.C.
Penney as her top choice for 2006, the retailer experienced a lift prior to the Macy’s
national relaunch this September, given the disruptions that took place in the former
May stores last year. She added that the company met its plan to open 28 new stores in
2006, and plans to open 50 more new stores each year in 2007, 2008 and 2009 in mostly
off-the-mall formats. As for the new stores this year, she said they all showcased upgraded features intended to make the retailer an “easy and exciting place to shop with
visually appealing displays to showcase merchandise...and appearance elements that
highlight specific brands.”
On Nov. 9, the Plano, Tex.-based retailer posted a third-quarter net income gain of
23 percent to $287 million, or $1.26 a diluted share, from $234 million, or 94 cents, in
the same year-ago quarter. Analysts had the company pegged to earn $1.23 per diluted
share. Operating profit rose 24.1 percent to $504 million from $406 million last year.
Sales rose 6.7 percent to $4.78 billion from $4.48 billion. Same-store sales showed an
increase of 5.2 percent, while Internet sales jumped 27 percent.
Bear, Stearns retail analyst Christine Augustine wrote in her research note that
Penney’s 5.2 percent comp gain was “well-ahead of the low-single-digit plan for the
quarter.” Sales of footwear, women’s accessories and fine jewelry primarily led
the way for the period. She revised her fourth-quarter earnings per share estimate
to $1.96 from $1.89 and her full-year 2006 estimate to $4.85 from $4.76. Augustine
noted that by 2009, about 75 percent of the company’s store base, which represents
90 percent of sales and operating profit, should be new or renovated. As for the
newer stores opened or planned, the “off-mall stores cost more to build but are
more productive than the mall-based stores, generating higher sales per square
foot than J.C. Penney mall stores and are tracking to over $250 sales per foot by
maturity [5 years].”
JP Morgan analyst Charles Grom wrote that J.C. Penney is firing on all cylinders
following a very strong third quarter in which earnings per share rose 34 percent yearover-year on top of an 89.4 increase last year. While Grom mostly liked what he saw
from the company reports during its third-quarter conference call, he cautioned that
for the “third consecutive quarter, [the retailer] beat its revised outlook just a week
after its final update. This may come back to haunt [J.C. Penney] down the road when
this trend doesn’t repeat itself.”
To be sure, J.C. Penney isn’t the only retailer that posted strong third-quarter results. It competes with main rival Kohl’s Corp. in many of the same geographic and
merchandise markets.
“Kohl’s continues to fire on all cylinders across all categories. We expect top-line
momentum to continue into the fourth quarter,” wrote Adrianne Shapira, analyst at
Goldman Sachs.
On Nov. 9, Kohl’s posted a 44.7 percent increase in third-quarter earnings, driven
by new store growth and demand for improved merchandise. Income surged to $224.5
million, or 68 cents a diluted share, from $155.1 million, or 45 cents, in the year-ago
period. Sales jumped 16.6 percent, to $3.64 billion from $3.12 billion, while total samestore sales rose 8.5 percent.
Piper Jaffray analyst Jeffrey Klinefelter believes that consistent storewide performance increases visibility for earnings growth going forward, adding that market share
gains are driven in part by a growing brand portfolio.
Still, Bear, Stearns’ Augustine believes that shares of Kohl’s are fairly valued and
noted that with earnings and square footage growth likely decelerating to the midteens in 2008 and beyond, the stock might not warrant its historical premium to 25.2
percent versus the market on a three-year basis.