OK, let’s put an end to the rumors about what’s going into the old Herberger’s spot at Viking Plaza in Alexandria.
Roughly one-third of the space will likely be a department store chain – either a Marshalls or a TJ Maxx.
That’s according to Scot Snitker, national portfolio manager for the owners of the mall, Lexington Realty International. He talked about the mall’s future in an interview with the newspaper last week.
Whether it will be a Marshalls or a TJ Maxx is still up in the air. The same company, TJX Companies, owns both.
One of those department stores will be going into the 25,000-square-foot space on the front part of Herberger's.
The plan right now is to split the remaining space in two. Roughly 22,000 square feet will be used for “service/entertainment,” Snitker said without naming potential tenants, and the remaining 30,000 square feet of the Herberger’s space, the part next to Jo-Ann’s Fabrics, will be “optional space,” he said.
“We’re still working on that,” he said, adding that the Alexandria School District and Alomere Health have talked about the possibility of leasing that space but nothing was approved.
“I’d still love to have school offices here,” Snitker said.
Other tenants he’d like to see at the mall include a hair salon or a cellular service company.
Discussions with potential tenants for the space once occupied by JCPenney are ongoing. Snitker said it will likely be a clothing store geared toward men.
An upbeat attitude
Snitker is upbeat about the mall’s future.
“We had the opportunity to be out of it or to buy it back,” he said. “We bought it back because we believe it will work – and it will.”
A new tenant recently opened in the old Book World space at the mall – Fine Pickins. Snitker described it as an “upcycling” store that transforms old unwanted materials into new furniture, craft items and other products.
Although the mall is going through its typical winter slowdown, there’s still things happening at Viking Plaza and the stores are doing well, Snitker said. Tenants are renewing their leases, including D.Michael B’s – which deflates another rumor that the popular restaurant was looking to move to a new location.
“The stability is there,” Snitker said. “New leases have been signed – our tenants are happy with what’s going on here.”
Nearby Lexington malls
Other malls owned by Lexington are making comebacks and adding tenants too, Snitker said. The mall in Brainerd is filling its old Herberger’s space with Ashley HomeStore and has added a Planet Fitness. The Bemidji mall added Hobby Lobby, Kohl’s and Dunham’s Sports and is back to full capacity. The mall in Hutchinson signed Marshalls to move into the old JCPenney spot and recently completed a $500,000 parking lot improvement project.
As reported last fall, Viking Plaza landed a $200,000 loan from the city’s Revolving Loan Fund to help pay for a $2.6 million remodeling project in the 1971 building as well as parking lot repairs and other site work.
The mall hasn’t used any of the loan yet, however, Snitker said. It’s pending until the title work is finalized. “That can happen any day now,” he said.
When Herberger’s, JCPenney and other tenants closed their doors, some people concluded that people stopped shopping at the mall. Snitker pointed out that many of the closings were because the store’s corporate offices were bankrupt, not because sales were lagging at Viking Plaza.
Some other stores left the mall for reasons not tied to sales, Snitker said. The owner of Glenwear retired. Karrow’s Jewelry decided to consolidate into one location. Another tenant is closing because he could no longer afford insurance.
The retail market nationwide started to falter about four years ago – but not just because of Amazon’s online sales, Snitker said. He said shopping patterns changed and demographics shifted.
“We go through these cycles,” he said. “But at some point, it comes back around.”
Snitker believes consumers still want to go shopping in stores, not just on their computers. “There’s still something to be said about going to the mall – you can’t sit inside your house your whole life,” he said.
Another misconception people have about the mall is that its leasing rates are too high, Snitker said.
“I’d put our rent up against any place in the community,” he said. “We’re not high and we’ll work with you on the rate. We want to make sure you succeed.”
Leases aren’t solely based on a strict square-foot rate and are often adjusted depending on the tenant’s financial success. “Every lease is different,” Snitker said.
A bump in business
There are signs that the retail industry is recovering. Snitker said that holiday shopping was up 7 percent from last year at brick-and-mortar stores nationwide, which matches the 7 to 7.5 percent spike at Viking Plaza.
“That was a nice bump,” he said.
Viking Plaza is better off than many other malls, Snitker said. “There is no mortgage on the property, no banks involved,” he said.
When asked on a scale of 1 to 10 how confident he was about the mall’s financial future, Snitker didn’t hesitate.
“A 10,” he said. “I’m very confident about the future. We have a lot of money invested in it. We wouldn’t have bought it back otherwise.”