The decision by Nordstrom to close its Circle Centre store is downtown’s biggest blow since the 1996 police brawl. Nordstrom was Circle Centre’s shining star because if Nordstrom hadn’t committed as the mall’s flagship, the mall never would’ve gotten off the ground.
The Seattle retailer’s upscale panache and famed service was part of the lure that made the mall a major success.
But then Nordstrom gambled that Indianapolis could support a second store, so they opened one at the Fashion Mall at Keystone at the Crossing. But the gamble failed because while the Northside store flourished, downtown lost a prodigious amount of sales.
Nordstrom isn’t Macy’s. They’re a successful upscale department store chain that carefully opens and rarely closes stores. While they suffered sales downturns during the great recession, their same store sales have increased for 18 straight months.
In an interview on our WTLC-AM (1310’s) “Afternoons with Amos,” Erik Nordstrom, founding family member and the company’s president of stores, indicated how difficult a decision closing downtown was. “Nordstrom rarely closes stores,” he said.
If Nordstrom downtown wasn’t making sales, there’s concern about Carson Pirie Scott, the mid-scale department store that took Parisians’ spot four years ago.
Some rumblings say Carson’s sales are anemic. But the Indianapolis Business Journal (IBJ), which broke the Nordstrom closing story, says Carson just signed a new lease till 2016.
But, I’ll bet the mall gave Carson’s serious rent concessions to stay.
I was disturbed at the Ballard administration’s attitude about Nordstrom’s closing. As usual, Mayor Ballard never commented directly, continuing his record as Indianapolis’ most uncommunicative mayor.
Ballard aide Marc Lotter said the mayor talked with Nordstrom officials. Deputy Mayor Michael Huber told IBJ that the city had tried to make Nordstrom offers to stay.
Yet whatever the city offered, (if they really offered anything), couldn’t convince Nordstrom to stay.
Indianapolis’ mayors have been, in my view, bungling when it comes to working with retailers. Our mayors can attract industrial, service and biotech businesses to Indy, but they’re inept working with retailers. Other than Circle Centre, name one major retail revitalization project created or championed by our mayors?
It doesn’t help that mayoral advisers never come from the ranks of those who’ve run retail stores for a living. You can’t help an industry if there’s nobody on your team who understands them.
Even Democratic mayoral candidate Melina Kennedy seemed unsure of a strategy for keeping Circle Centre vibrant. But so did the mayor’s minions.
Lotter and Indianapolis Downtown’s chief Tamara Zahn told me on air that convention and visitor business was the key to Circle Centre retailers’ success.
But that’s not who the mall was designed for.
Circle Centre was designed to be a regional mall, pulling customers from the entire metro area. Visitor and convention business was to be gravy.
Who are Circle Centre’s customers? Scarborough Research, utilized by every major Indy media, estimates 176,400 metro adults shop every three months. That ranks Circle Centre sixth among area malls.
Castleton’s solidly in first, followed by Greenwood. Metropolis Mall in Plainfield is third, then the Fashion Mall, the Edinburgh Outlet Mall, then Circle Centre, with Washington Square close behind.
The profile of Circle Centre and Fashion Mall customers are remarkably similar. Half of both malls’ customers earn over $75,000 yearly. Over 45 percent are college graduates and the ages of both are concentrated between 25 to 54. A higher percentage of Blacks (16.5 percent) shop at Circle Centre versus 12 percent at the Fashion Mall.
Based on that profile, Nordstrom should’ve been a lock both downtown and Keystone. But, Simon, the conglomerate who runs Circle Centre doesn’t promote shopping at Circle Centre the way they do Greenwood, Castleton and the Fashion Mall.
Zahn says downtown residents are Circle Centre’s base. So does rookie Indianapolis Star columnist Erika Smith.
Both ignore the demographic realities. Despite growth in two inner downtown neighborhoods, the population within two miles of Circle Centre declined 5.4 percent since 2000; from 36,054 to 34,097.
Downtown residents alone can’t support Target, Best Buy or the rumoredl hordes of potential successors to Nordstrom’s vacancy.
City leaders and more importantly the aloof, arrogant executives at Simon need to get their heads out of their whatevers and return to the strategy that made Circle Centre successful. Create reasons to shop downtown for metro and regional shoppers. Not create a mall for visitors and the small downtown residential crowd only.
The latter is a prescription for downtown and Indianapolis disaster!
What I’m hearing
in the streets
New data released by the 2010 Census continues to show an extremely complex and complicated Indianapolis/Marion County.
Drastic change has occurred in the composition of Indianapolis’ households. Nationally, married couple families are now a minority of American households, just 48.4 percent. Statewide, just 49.6 percent of Hoosier households are married ones. But slightly more than a third of Indianapolis/Marion County’s 366,166 households, 36.9 percent are married households; the lowest percentage of Indiana’s 92 counties.
Of the state’s 92 counties, Indianapolis/Marion County has the second highest percentage of single female-headed households, right behind Lake County. Indy also has the state’s third highest percentage of non-family households (40.4 percent) and of households living alone (32 percent).
Homeownership also declined in Indianapolis during the century’s first decade. The number of households owning their homes dropped 1,976 or 0.9 percent.
Homeowners declined in Center (-20.1 percent), Warren (-3.7 percent), Washington (-4.4 percent) and Wayne (-10.8 percent) townships.
In weeks, the Census will release detailed data on our African-American that will answer questions about the depth of change Indianapolis is undergoing.
See ‘ya next week.
