Old Magnets Just Don't Attract

(By Sean Kelly for The Washington Post)

Michelle Yass said people often ask her if there's a movie theater at Fair Oaks; she tells them no and sends them to Fairfax Corner instead, where there's a 14-screen cinema.

"There's something about outside that's way better than [being] inside," said Michelle's mom, Paula Yass.

She shops at Fairfax Corner when she wants to go to Chico's and Ann Taylor Loft or get lunch at beach-themed restaurant Coastal Flats. The development has only a handful of retail stores -- and none of the same stores as Fair Oaks -- but industry experts say projects like Fairfax Corner are the future of shopping centers.

Restaurant-anchored developments may also attract wealthier shoppers. According to a survey by the National Retail Federation, people who ate at full-service restaurants four or more times per month were more likely than the average adult to shop at department and specialty stores and less likely to shop at discount stores. Their average income was $65,483, compared with an overall average of $52,300 for those surveyed.

Traditional malls, meanwhile, are grappling with tepid department-store sales and closings. According to the International Council of Shopping Centers, same-store sales at department stores were up just 1 percent in February, the last month for which data were available.

Federated Department Stores Inc.'s acquisition of the former May Department Stores Co., which owned several regional chains including Hecht's and Marshall Field's, is also leaving malls with vacant anchor positions. Federated is divesting 80 stores across the country in connection with the merger, giving malls a rare opportunity to make major changes.

"They have to look around and see what itch can be scratched. And they've got to be committed to spend the money necessary to scratch that itch," said real estate broker Peter Framson of Green Light Retail Real Estate Services LLC. "You either do that or you become irrelevant."

Many shopping centers are using the opportunity to lure alternative anchors and mimic the look of town centers. Last week, for example, Target Corp. said it would take over four anchor locations in California, New Mexico and Pennsylvania from Federated.

At Westfield Montgomery, owner Westfield Group is planning to remodel and expand by 500,000 square feet. Westfield spokeswoman Katy Dickey said final plans call for more restaurants with outdoor seating and a new fashion wing. The company is calling it a "high-style approach," she said.

"It's essentially a hybrid," Dickey said. "We have an existing traditional regional mall, and it's incorporating some of these nontraditional elements."

Another Westfield property, Westfield Wheaton mall, brought in Target as an anchor tenant four years ago after the space was left vacant when Montgomery Ward department stores went out of business. The mall also recently completed a $140 million renovation that included adding a Bally's Total Fitness and expanding a Giant Food on its grounds.

Perhaps the biggest buzz in the Washington area has been around Tysons Corner Center, which last year completed a 362,000-square-foot expansion. It added a movie theater, a food court and a bevy of restaurants including Pauli Moto's, an Asian bistro from "Iron Chef" Masaharu Morimoto. A new ad campaign reads: "Blackened mahi-mahi with cajun remoulade. Hungry? Tysons, where the restaurants are."