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NEIMAN, TARGET SHARE MALL FOR FIRST TIME

BY DEBRA HAZEL

High fashion will meet high discounts when Neiman Marcus and Target enter Westfield Shoppingtown Topanga, in Canoga Park, Calif., in 2008. This is the first time the two will be under one roof.

Developer Westfield Group is paying $300 million to add 600,000 square feet to the 1 million-square-foot mall.

“We’re creating the gamut of shopping,” said Richard E. Green, vice chairman of Sydney-based Westfield’s U.S. operations. “This is proving to be the most exciting time in the business. Malls will be one-stop shopping.”

At one time, asking a discounter to coexist in the same center with one of the highest-end fashion anchors in the country would have been asking too much. But today’s retail realities say the two are not such strange bedfellows, says Green. Consumers shop both, for different needs.

Anchor consolidation has helped drive the trend. Federated Department Stores’ recent announcement of its acquisition of May Department Stores Co. only further drains the anchor pool.

“You do have dark anchor stores, and it is not as readily feasible for department stores to operate more than one box going forward,” said Margaret Gilliam, president of Gilliam & Co., a New York City-based retail consulting firm.

Westfield already has several Targets and one Wal-Mart in its malls, as well as big boxes like Bed Bath & Beyond and Linens ’n Things. Topanga, however, could become the ultimate combination of fashionable and discount anchors.

Given Topanga’s location in an affluent area, the addition of a Neiman Marcus to its existing anchor mix of Nordstrom, Robinsons-May and Sears made sense, observers say. The mall sits on Topanga Canyon Boulevard, between Victory Boulevard and Vanowen Street, in the center of the San Fernando Valley. Not only are the 1.5 million inhabitants very affluent, with an average household income of more than $76,800 in 2003, the closest Neiman Marcus store is 20 miles to the south in Beverly Hills.

Nordstrom is building a 205,000-square-foot store at the center, which is also adding more than 100 specialty shops, three covered parking structures and a café-style Dining Terrace. “Neiman Marcus and other Tenants enthusiastically agreed to add Target to their mix,” Green said. “All of the things Target is selling are the things that haven’t been sold in malls for years,” he said, referring to such as housewares, small appliances, electronics, and health and beauty aids.

Gilliam applauds the move. “It will be fantastic,” she said. She has been an advocate of combining discounters with fashion anchors for over a decade, citing the success of Mall of America. The Bloomington, Minn., megamall opened in 1992 with a mix that includes Bloomingdale’s and Marshalls.

The Topanga expansion broke ground in February. Target and the new Nordstrom will open next fall. Neiman Marcus will then break ground on the former Nordstrom site to open in the spring of 2008.

The odds are good that the Neiman-Target combination could crop up again. Said Gilliam, “It’s going to happen.”