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MACERICH TAKES OVER TYSONS REDEVELOPMENT MIDSTREAM

Tysons Corner Center, firmly ensconced in one of the wealthiest counties in America, was sitting pretty as the Washington, D.C., area recovered from the September 2001 terrorist attacks. Over 95 percent leased and boasting some of the headiest sales-per-square-foot numbers in the country, the McLean, Va., mall already stood as one of the nation’s elite shopping centers.

Wilmorite and Alaska Permanent Fund Corp., which owned the center, wondered if on the heels of successful renovation-expansion in the late 1980s they dared try to gild their flourishing lily yet again.

Then in early 2003 major tenant JCPenney announced it was raising anchor. The owners promptly bought the 230,000-square-foot space with plans to re-tenant and refresh it, as well as fix a few flaws. “We saw that after people finished shopping, they would go across the street to [Tysons] Galleria to eat,” said Michael J. Nevins, then a leasing official at Wilmorite, and now eastern zone vice president of leasing for the center’s current owner, The Macerich Co. “So we decided to turn the Penney’s space into an inward-out lifestyle center with fine-dining restaurants in addition to first-to-the-market tenants.”

But there was still a weakness left: The mall lacked a movie theater, mostly for want of space. So the owners invited picked AMC Theatres to build a 16-screen cinema atop center court. They chose Baltimore-based RTKL to design the rest of the renovation.

In April, about five months before the expanded center was to open, The Macerich Co. bought it. “We were up to our elbows in this thing, and [Macerich] basically said, ‘Keep doing what you’re doing on the construction and leasing end,’ ” said Nevins. “Then their marketing arm came in, and it became obvious their resources were much deeper than anything we’d seen.”

Macerich trumpeted the reopening far and wide, lining up two major events. It brought in the Grammy-winning Blind Boys of Alabama gospel music group for a rousing charity fund raiser. Then, as part of lease deal for new Tommy Hilfiger Corp. concept H Hilfiger, company Chairman Tommy Hilfiger agreed to preside over a runway fashion show in the mall’s common area. He had wanted more time to open the new store; the mall wanted it operating on grand-opening day. As a compromise, Hilfiger agreed to be host of the elaborate show and open H Hilfiger this month.

Talk about a buzz. “That show rocked and rolled,” said Susan Valentine, SCMD, senior vice president of marketing at Macerich. “I’d done nearly 30 mall openings, but when I looked down at the show and all the traffic it had generated, all I could say was, ‘Wow!’”

A record 214,000 shoppers attended the Sept. 30-Oct. 2 opening weekend.

Chuck Stilley, president of AMC Realty, says he was floored. “Tysons Corner is a knock-it-out-of-the-park location,” he said. “It’s met all of our expectations, and it’s just going to get better. We’d been trying to do a deal there for 15 years.”

Not that there was not some initial trepidation. “The easy thing would have been just to take the Penney building and sell it to Target,” said Douglas H. Morrow, Eastern zone vice president at Macerich. But officials resisted the temptation and was rewarded for its patience. The space, which had generated $30 million in annual sales is expected to now yield $150 million per year, with splashy new shops such as accessories store Laila Rowe and furniture store Z Gallerie and fine-dining eateries such as Brio Tuscan Grille and Moto’s Asian Bistro, Morrow says.

There is more to come. Fairfax County is reviewing the mall’s plan to add peripheral residential, office and hotel space to the property.

Meanwhile, Macerich estimates that the 2.4 million-square-foot center, with 250 shops and anchors that include Nordstrom and Bloomingdale’s, posts sales of about $680 per square foot and may reach $1 billion in total annual sales by 2010, “with a little luck, a strong economy and strong merchandising,” Nevins said. “We had high expectations going in, and the results and the feedback greatly exceeded everyone’s expectations.”

— SM