Even before Short Pump Town Center and Stony Point Fashion Park opened within two weeks of each other in September 2003, there had been cross-town competition between the malls’ developers.
In 1999, when both projects were still on the drawing table, discussions centered around whether the region could support or needed two brand-new malls.
Commercial real estate broker Lee Warfield predicted back then that only one of the malls would be successful if both were built as planned. After all, only two new regional malls opened in the United States in 2003 — and both of them were in the Richmond region.
“One has thrived and one has floundered,” Warfield said last week, reflecting on the retail rivalry between the two malls.
“You can look at one thing, and that’s location,” said Warfield, now president and CEO of Henrico County-based Cushman & Wakefield | Thalhimer.
“One mall has a great location for retail and one is inferior. Even though Short Pump is way out on the western edge of town, it’s an identifiable shopping hub. You have a variety of choices and options up and down Broad Street that draw you there,” he said.
The two giant shopping centers — Short Pump in western Henrico County and Stony Point in South Richmond — brought dozens of new stores and restaurants, many new to the region, including Nordstrom, Saks Fifth Avenue, Crate & Barrel, Restoration Hardware and P.F. Chang’s China Bistro.
While Short Pump has excelled over the years, Stony Point hasn’t performed as well. It has struggled to attract customers and keep some of its high-brow tenants.
But the battle between these two malls over the past 15-plus years comes as all U.S. shopping centers are taking a hit. Consumers have changed their habits and are shopping online more.
Many tried-and-true mall tenants such as The Limited, Coldwater Creek or Wet Seal have closed stores or filed for bankruptcy in recent years. And an increasing number of shopping centers are losing traditional anchor tenants such as Macy’s, J.C. Penney and Sears.
Stony Point Fashion Park, located off Chippenham Parkway in South Richmond, is on a landlocked parcel that hampers its vibrancy, some experts said.
The mall, surrounded by affluent suburbs and a medical office park, was envisioned by developer Robert S. Taubman of Taubman Centers Inc. as an upscale mall drawing shoppers from across the region attracted to brands such as Saks Fifth Avenue, Louis Vuitton, Tiffany & Co. and Brooks Brothers.
Michigan-based Taubman Centers sold Stony Point Fashion Park and six other shopping centers, including MacArthur Center in downtown Norfolk, to private equity firm Starwood Capital Group in 2014. The malls are operated by the company’s Chicago-based Starwood Retail Partners division.
Stony Point Fashion Park had about 90 tenants when it opened. Now there are about 60.
The mall’s tenant mix has changed. Saks Fifth Avenue, Tiffany & Co. and Brooks Brothers remain, but Louis Vuitton, Betsey Johnson, Cole Haan and Mikasa are gone. Anchor tenant Dick’s Sporting Goods is closing its 84,000-square-foot store there on Sept. 16.
“We know that retail is constantly evolving, and it’s a little bit challenging right now,” said Vince Mistretta, Stony Point Fashion Park’s general manager. “What drives us is paying attention to how our shoppers, diners and visitors want to experience Stony Point.”
The mall’s new owners in 2015 announced plans for $50 million in phased renovation of the mall.
Phase one was completed in fall 2016 and added new seating areas, a new children’s play area, a dog park and a grassy open space that in the winter is converted into an ice skating rink.
Planned future renovations — if they happen — call for demolishing part of the buildings near Dillard’s and CineBistro to create pedestrian cut-throughs to the parking lots. Tenants that occupied some of the spaces were relocated in the mall in preparation for the work on the cut-throughs.
But after some initial signs of construction last year when barricades blocked off areas of the mall, there’s not been sign of that work. Mistretta would not comment on the status of the renovations.
In marketing materials posted online this spring, Starwood Retail Partners describes changes underway at Stony Point to offer a “food hall experience wrapped in southern hospitality” and a “boutique market with fresh produce, seafood, wines, cheeses, fresh-baked breads and pastries, a deli, a social craft beer experience, and distinctive retail.”
“We continue our focus on community,” Mistretta said. “We have new locally owned restaurants and shops.”
A new Latitude Seafood Co. restaurant is moving into space that formerly had been used by Uncle Julio’s Rio Grande restaurant, an original tenant that closed in early 2007 and whose space has been vacant ever since. La Hacienda restaurant will open in space where Chipotle Mexican Grill had been before moving out in January.
AR Workshop, a wine and do-it-yourself project concept, and Gnome & Raven, an immersive play experiences venue, are expected to open in October. Bravo Rocco Italian Café coffee shop and a Cscrubs with Love Uniform Boutique shop opened recently.
The new coffee shop replaces the Starbucks that left the mall in February 2014.
Tom Arnold, a professor of finance at the Robins School of Business at the University of Richmond, called Starbucks’ departure a bellwether moment for the mall.
“That was an entity that attracts and brings in a lot of traffic. If Starbucks decided it’s not working, that is not a good sign,” Arnold said.
“I think what you have right now there is too much retail space and that will shrink to an optimal size. I don’t think [the mall] will go away. It’s never going to be Short Pump but ultimately Stony Point has to figure out its identity and then have a size appropriate to that identity. I would say given all the empty storefronts and all of the medical facilities around it, maybe those two pieces have to merge somehow,” Arnold said.
Bruce Huhmann, chairman of the department of marketing at the VCU School of Business, said the mall’s operators have created a “wonderful place to walk around” but need more attractions that make the mall a destination.
Short Pump Town Center’s mix of retailers at multiple price points makes it a mall for the masses.
Stores such as Old Navy and H&M appeal to bargain hunters, while there are higher end retailers such as Nordstrom, Kate Spade and Michael Kors for those who want to spend a little more. The 1.3 million-square-foot mall has about 140 stores.
“They have the junior anchors that are really attractive, like the Williams-Sonoma and Pottery Barn, tenants like that which are big draws,” Warfield said.
The mall has racked up gross sales of more than $4.6 billion over its tenure, according to figures provided by the Henrico County Finance Department.
The center has generated more than $103 million in tax revenue — including sales, real estate and property taxes — over the 15 years, said County Manager John Vithoulkas.
“It’s been absolutely phenomenal. Henrico’s retail sales now are the highest per capita in Virginia and number two overall in the state of Virginia, second only to Fairfax County, and Short Pump Town Center is a big reason for that,” Vithoulkas said.
John Wack, Richmond’s finance director, said the city doesn’t track or maintain sales tax information for shopping malls.
The city previously had supplied the figures. A 2013 article in the Richmond Times-Dispatch said Stony Point Fashion Park sales in 2012 totaled $110.56 million, compared with $167.08 million at Chesterfield Towne Center and $352.2 million at Short Pump Town Center.
The number of vacant tenant spaces in the malls also tell a story. A walk through the malls shows empty spaces at both, but with Short Pump’s size, the vacancies have less impact.
Nationally, the retail landscape is changing as people shop differently.
Some experts say brick-and-mortar stores have become showrooms for online retailers. Customers visit stores to look and touch the merchandise but then go online to purchase if products are cheaper and the shipping is free. Or they skip the store visit altogether in favor of the ease of online shopping.
Just about every major mall used to have department stores such as Macy’s, J.C. Penney and Sears as anchor tenants. All three retailers have downsized in recent years, collectively closing hundreds of stores and leaving malls with big empty buildings unless replacement tenants are found.
Macy’s and Sears closed stores at Regency mall in Henrico. Macy’s and Dillard’s closed stores at Virginia Center Commons mall in northern Henrico.
Regency, once owned by Taubman Centers, is undergoing a major renovation under new owners, adding more restaurants and entertainment options, and possibly a residential component in the future.
Virginia Center Commons was sold for $9 million in January 2017 to a New York investment firm that has bought similar distressed malls across the county and run into problems with local officials for not paying taxes and in at least one case, falling behind on the light bill.
Reis Inc., a New York-based commercial real estate market research firm, reported U.S. mall vacancy rates at 8.4 percent in the first quarter of 2018, up slightly from 8.3 percent the previous quarter.
“The shopping part has become a little less of a reason for people to go. Part of that is demographic trends,” VCU’s Huhmann said. As people age they need less stuff to outfit a home or their wardrobes, he said.
One thing that might help physical stores is the recent U.S. Supreme Court ruling that allows states to collect taxes on online sales.
“Maybe the new changes ... will start helping brick and mortar stores to get back on little more of an equal footing. Online retailers for a long time had the upper hand,” Huhmann said.
For Stony Point, the biggest challenge is filling the 84,000-square-foot, two-level Dick’s Sporting Goods space and stabilizing the tenant lineup, said Warfield with Cushman & Wakefield | Thalhimer.
“Their biggest need is that mid-sized anchor tenant. They have been able to get Anthropologie; more tenants like that would help them. Or go entertainment-based to get people out there,” he said.
Stony Point has been doing just that — focusing on offering experiences for consumers.
A summer concert series draws crowds to hear local bands on alternate Thursdays. A junior “idol” contest earlier in the summer had more than 60 children competing for local stardom. The mall’s Live360 program brings in a variety of active lifestyle events, including weekly salsa dance lessons with instructor Angel A. Rodriguez and his dance crew.
An assortment of new tenants — a pet photography studio, a window treatments design business, a cigar shop — are all locally owned.
“Our department stores do well and our restaurants are popular,” Mistretta said. “We just continually are adding retailers, restaurants and experiences based on what our customers are responding to.”
Short Pump Town Center has the right mix figured out already, said retailer Gary Weiner of locally owned and operated Saxon Shoes.
Sixteen years ago when Stony Point and Short Pump were under construction, both malls came calling. He turned down both, deciding that his location then in Ridge Shopping Center on Parham Road near Regency mall was still a good location. At the time, his store had been rebuilt from a fire a few years earlier.
Two years later, Short Pump came knocking again, trying to fill space that had opened up after plans for a Lord & Taylor department store fell through, Weiner said.
“They said, ‘Would you like to be on the front of the mall next to Cheesecake Factory.’ I said, ‘Twist my arm,’ and here are we are 13 years later,” Weiner said last week at his store on the upper level of Short Pump Town Center.
“This is where people are doing shopping. Anybody who’s trying to do larger business, this is where the bulk of the traffic is. People are buying and shopping all over town, and a lot of stores are doing very well all over town, but most shopping is being done in Short Pump Town Center, and that’s where we want to be,” Weiner said.