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Thursday, Aug 18, 2022
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Stop & SHOP?

Drivers on the 5 Freeway will have a new destination to stop and stretch – and hunt for some deals while they’re at it. The Outlets at Tejon Ranch opens next month and will feature more than 70 retailers including California’s only Pottery Barn outlet, an As Seen on TV store and an H&M location that will sell merchandise at full price. With hopes of attracting all kinds of shoppers – not just young females – the outlets are prepared to accommodate traffic from every entry point: the San Fernando Valley, Santa Clarita, Los Angeles, the Antelope Valley and Bakersfield. Tucked at the bottom of the Grapevine just before the Highway 99 interchange, the 320,000-square-foot shopping center will also welcome some high-end apparel brands that have become staples in outlet malls across the country including Michael Kors, Ann Taylor Loft, Banana Republic and even Coach, which just last month announced it will close 70 of its full-line stores in the next fiscal year. Although many of the stores might be what shoppers have come to expect at outlets, Tejon Ranch is relying on easy accessibility to deliver traffic, since the closest outlet malls are Camarillo Premium Outlets and the Citadel Outlets in Commerce – both of which are a solid 80-plus miles away from where construction is now underway on the new complex. “This is a perfect location. Why would you want to sit in traffic to get to the Citadel when you can come up here and enjoy a beautiful drive?” said Brian P. Hassett, general manager for the Outlets at Tejon Ranch. “When we reached out to retailers to gauge their interest, it was an overwhelming ‘yes.’ A lot of people are surprised no one had done it before.” Selling out The center will open Aug. 7 with full occupancy, which Hassett said is unheard of in the industry. He has spent the last 10 years building up shopper traffic in Camarillo, starting with the Premium Outlets and its later addition, the Promenade at Camarillo Outlets. He oversaw the expansion that took those outlets from 120 stores up to 160, making it the largest outlet center on the West Coast with 14 million visitors annually. If Hassett has his way, Tejon Ranch will eventually draw that level of retail clientele. But for now, the project will start with an initial phase that takes future expansion into consideration. Tejon Ranch Co. will act as the landlord for the new outlet center. According to Barry Zoeller, vice president of communications and marketing for Tejon, a 180,000-square-foot expansion is already in the works, and could begin immediately after the grand opening, based on performance. If built, this would put the entire center at 500,000-square-feet. As significant as that might sound, it is only a small fraction of the 270,000 acres of land that make up the entire ranch: That equates to 422 square miles, about the size of the whole city of Los Angeles. While the ranch, which dates back to 1843, already has operations in farming, filming and equestrian events, adding retail has been an interest for many years, Zoeller said. The new shopping mall was developed by Tejon Ranch and New York commercial real estate firm Rockefeller Group International Inc. The investment amounted to $90 million, including the value of the land. A groundbreaking took place last May, and construction began in September. Hassett and Zoeller expect about 1,500 jobs to result from the outlet operations. And the stores expect about 200,000 shoppers during the opening weekend. Mike Dewar owns three candy shops in Bakersfield with his sister and father, and now Dewar’s Candy Shop will make an entrance in a new territory when it opens at the Outlets next month. “There are about 140,000 vehicles that pass by the outlet mall each day. If just a small percentage of those people stop in for an ice cream, we will be living the sweet life,” Dewar said. Dewar’s is opening in the food court alongside four other restaurants, so its 814-square-foot space is notably smaller than its 6,400-square foot location on Calloway Drive in Bakersfield. In the mall, it will serve its most popular fountain items and ice cream flavors, as well as chews and chocolates. And since it is an outlet mall, Dewar’s will sell overstocked merchandise such as t-shirts at a discount. “We feel it is perfectly suited to our business model,” Dewar said. No discounts? The largest Tejon tenant will be H&M with about 21,000 square feet. Although it’s opening at the outlets, it will carry its regular-priced apparel. “With our concept of fashion and quality at the best price, we have found that our stores perform well at these types of shopping centers,” said Nicole M. Christie, spokeswoman for the company, in an email. “We think that H&M will be the perfect addition to the retail mix at the Outlets at Tejon Ranch.” Prices at H&M vary, but a sweater could cost about $19.95 and a shopper could grab a swimsuit for about $35. Other brands such as Coach will presumably offer deep discounts on merchandise that could cost more than $400 for one of its newest handbags. Following the announcement of store closures due to poor sales, many experts said the company invested too heavily in outlets and not enough in full-line stores. Coach confirmed its opening at Tejon but gave no further comment. According to Hassett, who previously worked for Coach, designer brands depend on outlet malls to introduce customers to the brand. And Lisa Wagner, principal with global real estate brokerage firm Avison Young Inc.’s Atlanta office, said it’s really the high-end luxury names that shoppers are looking for when they stop to shop at an outlet mall. Wagner, who worked on an initial feasibility study for the Tejon project four years ago, also represents both developers and retailers as the chair of the Outlet Marketing Alliance, a group within the International Council of Shopping Centers. “Consumers seem to want to feel that the items they are buying are exciting and fresh fashion, and outlets are a great place to find that,” she said. Wagner said that because of the explosion of price-conscious customers, the outlet industry has never been healthier. “We know that outlets perform well in good times, but they perform fantastically in difficult times,” she said. “You could say the recession was the best thing that ever happened to our industry in that it cemented the consumer’s appetite for brands at a value.” Full capacity Despite the high expectations, not too many more outlet malls are likely to appear in the region, since experts say most national retailers set parameters on how close to build one store to another. The National Retail Federation’s Dan Butler, vice president of communities integration, said retailers must be cautious to stick with about one or two stores per ZIP code to avoid competition with their own brand. With that said, he noted it is a testament that so many of these retailers are actively pursuing the market in California, since the state is notorious for imposing so many restrictions on businesses. “They have to know they’re going to succeed there to really comply and deal with the regulations,” he said. “As much as they’d like to grow there, they don’t grow as rapidly.” Hassett agrees there is a certain level of risk for any tenant to move into a brand new space, so he said that shows just how confident the retailers are that the location will surely draw in significant traffic and sales. Tenants in the retail center at Tejon are signed on for five- or 10-year commitments, so the center isn’t expected to have openings for new shops any time soon. Based on performance, Tejon Ranch could break ground on its second phase of shops, which could open as early as the end of 2015. For now, Hassett said the company is comfortable with the variety of shops it has in its first phase. “Having the proper merchandise mix is important,” he said. “We think this is going to be a great destination for a lot of folks.”

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