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GADZOOKS FILES CHAPTER 11

Youth apparel retailer Gadzooks has filed for Chapter 11 and is closing 125 stores. The Dallas-based chain, which already had 31 units under liquidation, will be left with 252 stores in all. Gadzooks says sales have been falling for months as a result of competition from Abercrombie & Fitch, Hot Topic and Pacific Sunwear, all of which target the same young customers. Late last year Gadzooks warned that it could go into bankruptcy, despite having switched over the summer from a male-female concept to its current women’s-only format. Real estate analysts say the closures will not have a severe impact on any one shopping center landlord.

TIME WARNER CENTER OPENS

The retail portion of the $1.7 billion Time Warner Center, one of New York City’s largest real estate projects ever, opened with a celebrity-packed, black-tie gala last month. Among the 5,000 guests were Salman Rushdie, Kevin Bacon and supermodel Cindy Crawford, who wandered around the 337,000-square-foot Shops at Columbus Circle. The Shops’ upscale tenants include Coach, Crabtree & Evelyn, Thomas Pink and Tourneau. Retailers and upscale restaurants take up the 80-story building’s bottom seven floors. The 2.8 million-square-foot development, across the street from Central Park, will also house the offices of Time Warner. Jazz at Lincoln Center is scheduled to open there in the fall. Occupants are already moving into a luxury Mandarin Oriental hotel and into condominiums that start at $1.8 million. Time Warner Center was built by a partnership of Apollo Real Estate Advisors and The Related Cos.

KB TOYS CLOSING STORES

KB Toys has started closing 356 stores, and an additional 115 could follow this month. The Pittsfield, Mass.-based toy chain, which is owned by investment firm Bain Capital, filed for Chapter 11 in January, hurt by competition from discount chains. The closures will leave KB with about 750 units.

HOLLYWOOD & HIGHLAND
SALE NEAR?

Trizec Properties may be close to exiting the retail real estate sector. The Los Angeles Times and others reported in January that Trizec is selling its last remaining retail property, the 1.2 million-square-foot Hollywood & Highland, a retail-entertainment center in Hollywood, Calif., to CIM Group for $200 million. Neither company has confirmed the deal. Last year Trizec sold the 500,000-square-foot Desert Passage mall, in Las Vegas, to New York City-based RFR Holding and East Coast developer David Edelstein for $241.5 million.

SIMON CENTER PROPOSED IN TEXAS

Simon Property Group is forging an agreement with the city of McAllen, Texas, to build an open-air, mixed-use project in McAllen, about 275 miles south of San Antonio. Simon’s 650,000-square-foot retail and restaurant portion of the project, to be called Palms Crossing, would go up on a site where the city is building a convention center and a performing arts space. McAllen Mayor Leo Montalvo told the local newspaper, The Monitor, that he would like to see the project completed by 2006.