Parisian Store in Rogers May Alter Retail Terrain

Publicly-traded Saks Inc. announced on Feb. 22 that it will build a 100,000-SF Parisian specialty department store in the 345-acre Pleasant Crossing development in Rogers. Pleasant Crossing is being developed by partners BOS Group LLC of Washington, D.C., Charles Reaves of Rogers, Greenhat Partners of Memphis and First Security Vanadis of Searcy.

That’s in addition to the existing 800,000-SF Northwest Arkansas Mall, the Dillard’s in The Pinnacle Hills Promenade and the newest “lifestyle center” player across the road from Pleasant Crossing, Centre Pointe.

Centre Pointe, which announced plans in January, doesn’t have an anchor.

What will the leasing efforts bring in? Will Northwest Arkansas become a shopping destination?

“It’s all a big guess,” said Alice Church, senior property manager at the Northwest Arkansas Mall.

If she had to guess, Church said that Pleasant Crossing might see retail chains like The Gap opening up smaller locations, but not full-size stores.

“It’s a convenience for the customer,” Church said. She said the convenience might cut into the stores’ sales.

Church said that other upscale retailers have approached the mall, but space wasn’t available.

“Just because they want to be here, doesn’t mean we have what they want,” Church said.

Church said anchor tenants typically pay common area maintenance fees, but very rarely will a property manager charge an anchor tenant minimum rent.

“Parisian brings a lot of shops with them that are complementary to them,” Developer Collins Haynes said. “There are a lot of companies that follow Parisian.”

The Northwest Arkansas Mall is 98 percent leased, and visitors averaged about 466,000 per month, or 5.6 million per year, which was about a 2 percent increase over 2003 tallies.

Haynes said Northwest Arkansas retail hovers around an average of 10 SF per person, which is behind the national average of 18 to 19 SF per person.

Take the most recent population estimates and multiply them by a national average of 18 SF per person, and that puts Northwest Arkansas at a need for 6.6 million SF of retail space.

Paul Justus, a planner with the Northwest Arkansas Regional Planning Commission, said the population within a 70-mile radius of Tontitown is about 1.2 million. And that’s according to the 2000 Census. Justus said the population of Benton and Washington counties is estimated at 369,000 as of the third quarter of 2004.

John George, marketing director for the Pinnacle Group, said Pinnacle’s Promenade partner General Growth doesn’t want to go to a market where the space per person has hit 20 SF. He said average income is another factor it considers.

Church said the Northwest Arkansas Mall sees a lot of visitors from Fort Smith, based on ZIP-code tracking efforts.

“It’s more of a social experience than just shopping,” Church said.

David Erstine, vice president of Real Estate Data Market Inc. in Springdale, said his firm estimates existing “competitive” retail space to be around 3 million SF in the two-county area, which is on par with the 10 SF per resident estimate, based on current population. That figure does not include the Northwest Arkansas Mall, Wal-Mart Supercenters or most Harps or Neighborhood Market Stores.

Pleasant Crossing will include about 1.2 million SF of retail. The two other “lifestyle center” developments planned call for at least an additional 1 million SF of retail space. The Pinnacle Group and Chicago-based, publicly-traded General Growth Properties recently released site plans for the 106-acre Pinnacle Hills Promenade complex in Rogers. That “lifestyle center” will include 275,000 SF of specialty retail space, a 155,000-SF Dillard’s department store, 70,000-SF of office space and a 275,000-SF big box retail village.

Seattle-based developer Goodman Real Estate Inc., Fort-Smith-based The Nelson and Beaty Co. LLP and Mitchell Massey announced in late January that their 184-acre “lifestyle center” development will partner with Urban Retail Properties Co., a Chicago-based third-party retail management company, to develop a new mixed-use project called Centre Pointe at Pleasant Grove.

Plans call at least for 350,000 SF of retail space.