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February 19, 1999
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The Dealmakers Issue Number 6 for the week of February 19, 1999. Retailers Expanding in The Rocky Mountain Region Granite Furniture Company operates four units in UT. The furniture
stores occupy spaces of 131,000 sq.ft. in freestanding facilities. Growth opportunities
are sought in ID, NV and UT. Preferred demographics include a population of 500,000 within
50 miles earning $30,000 as the average income. Leases running 20 years are typical. Harmon’s City, Inc. trades as Harmon’s City Markets
at eight locations in UT. The supermarkets occupy spaces of 65,000 sq.ft. to 70,000 sq.ft.
in freestanding facilities and strip centers. Plans call for one opening in the coming 18
months. Expansion will take place in the existing market. Jolene Company, Inc. trades as Jolene Children’s Outlet
at four locations in UT. The stores, selling children’s apparel at off-price points,
occupy spaces of 3,000 sq.ft. to 3,500 sq.ft. in outlet and strip centers. Growth
opportunities are sought in the existing market. Book & Game Co., Inc. trades as Book & Game, Aunties
Bookstore, Merlin’s Science Fiction Store, The Paper Garden and Uncle’s
Games, Puzzles Etc. at eight locations in ID, OR and WA. The stores, selling games and
books, occupy spaces of 2,500 sq.ft. to 12,500 sq.ft. in regional malls. Growth
opportunities are sought in ID and WA. Preferred demographics include a population of
30,000 within three miles earning $30,000 as the average income. Leases running 10 years
are typical. Monotag Corp. does business as Signs First at 37 locations
in AL, AR, CO, IN, LA, MS, TN and TX. The stores, selling computer generated signs,
banners and vehicle lettering, occupy spaces of 1,000 sq.ft. to 2,000 sq.ft. in strip
centers. Preferred co-tenants include Office Depot, OfficeMax and Staples. Growth
opportunities are sought in Denver, CO and Huntsville, AL. Preferred demographics include
a population of 100,000 within 75 miles earning $75,000 as the average income. Leases
running five years are typical and the company is franchising. Who’s Opening and Where A&P (201-930-8442) recently opened a 45,000 sq.ft. Sav-A-Center grocery store and a 48,000 sq.ft. Sav-A-Center grocery store at a former Kroger location in Gulfport, MS. The stores will be open 24-hours-a-day. The company is also planning to open three Sav-A-Center stores in the New Orleans, LA market. The Rockport Co. (617-341-7705) plans to open a 6,000 sq.ft. store at 465 West Broadway in the SoHo section of New York City this month. The store will contain SoHo-esque design elements, including a massage area and complimentary honey-ginger New Comfort tea. Videos and a spa-like feeling in the women’s area will add to the overall experience. The company plans to open 10 concept stores nationwide this year. In the works are stores for Newbury Street in Boston, MA and Third Street in Santa Monica, CA, both expected to open next month. A store will open at The Venetian Hotel in Las Vegas, NV during April. Last December, the company opened stores in Thailand, Prague, Jakarta and Hong Kong and is planning to open a store in Tokyo later this year. IKEA (610-834-0180) recently opened a new prototype concept store in Schaumburg, IL. The 400,000 sq.ft. store, the chain’s largest store outside of the Scandinavian countries, features a number of unique merchandising techniques, all designed to make the consumers’ shopping experience easier. The store is double the size of the average IKEA store and unlike other stores, this one has an octagonal shape to accommodate all of the fixtures and to improve the flow. Shoppers can choose from more than 10,000 items and the store is expected to generate $60 million in sales in its first nine months. The company currently operates 147 stores worldwide, including 13 in the U.S. Additional stores are planned for the U.S. including a store in San Francisco’s East Bay area which is expected to open during Spring 2000. Best Buy (612-995-7049) is planning to open as many as 250 stores in the coming five years, which should bring its total sales to close to $20 billion. Some of the planned stores will be smaller units running 29,000 sq.ft., which will be opened in small markets serving 150,000 to 200,000 people. The company is looking to roll-out its smaller format with four stores next year. The company also announces that it plans to open a 45,000 sq.ft. store at Frederick Crossing Shopping Center in Frederick, MD during Summer. It will be the company’s fourth store in the Washington, D.C. market and the first of 40 planned for 1999. Walgreens (847-940-2500) plans to open a 15,120 sq.ft. drug store at Hamptons Plaza in North Lauderdale, FL during August. In addition, the company is anticipating opening at least 12 stores in AZ this year. Currently, the company operates 137 stores in AZ. The company is planning to develop a 13,905 sq.ft. pharmacy with a drive-thru on Main Street in Tewksbury, MA. Von Maur (319-388-2200), the family-owned upscale fashion department store chain based in Davenport, IA, has been in discussions about three locations, one at 21st Street and Maize Road, one at 21st Street and Webb Road and the third at Bradley Fair Shopping Center in Wichita, KS as a possible site for a store. Currently, the closest store to Wichita is located in Omaha, NE. Von Maur stores, decorated with antique furniture and fabric-covered walls, carry men’s, women’s and children’s apparel, shoes, cosmetics, accessories and gifts. The stores carry brands such as Ralph Lauren, Tommy Hilfiger, Calvin Klein and Polo. The stores also feature a pianist at a grand piano who plays popular music. They also offer an interest-free charge account, free gift wrapping and free United Parcel Service delivery anywhere in the U.S. The privately held, 125-year-old company, operates 14 stores, which range in size from 40,000 sq.ft. to 200,000 sq.ft., in IA, NE, IL and IN. The company is preparing to open its 15th store in Lincoln, NE during August. CSK Auto Corporation (602-265-9200), which operates three chains--Checker Auto Parts, Schuck’s Auto Supply and Kragen Auto Parts, plans to open 105 new stores and relocate 45 others this year. The openings will include eight in AK, the company’s initial entry into the state. Burger King (305-378-7890) is developing a new prototype restaurant in Omaha, NE. The store is expected to open next month. The new prototype features a larger restaurant, more parking and an indoor playground area. The 4,248 sq.ft. restaurant, which is being built adjacent to a smaller unit previously occupied by Hot ‘N Now, will have a seating capacity of 144, approximately 60% larger the current store model. Forty of the seats will be in the playground area. In addition, the new store will have an updated, more efficient kitchen and an alternating drive-through window with two menu boards, allowing two vehicles to place orders simultaneously. The construction cost is estimated at $500,000. The franchisee plans to open three more of the new prototype restaurants near Highway 370 at 42nd Street in Sarpy County, at the Irvington exit off Interstate 680 and in Des Moines, IA. Acme Markets, Inc. (610-768-0707) recently opened a newly enlarged and remodeled Acme Superstores in Newtown Square, PA and in Lincroft, NJ, its first superstore in the northern NJ market. The Newtown Square store measures 62,000 sq.ft., while the Lincroft store occupies 53,000 sq.ft. Both stores feature expanded grocery, meat, produce, seafood, deli, bakery and dairy sections. Both stores are open 24 hours a day, seven days a week, and new departments and food services include a health food department, expanded organic and exotic produce, a sushi bar, service meat and seafood counters and a European-style cafe with coffee bar. Other amenities include a bank branch, video rentals, floral department, pet services, Western Union money orders, UPS service, stamps and a copy machine. Acme wants to build more superstores in these areas and its growth could quicken once Albertson’s finishes its deal to purchase Acme’s parent company, American Stores Co. The deal, which would create the largest supermarket company in the country, was approved by shareholders of the two companies in November and may receive FTC approval early this year. Nike (503-641-6453) recently opened a 28,900 sq.ft. NikeTown store at The Shops at Sunset Place in Coral Gables, FL. It is the company’s 12th unit. A final NikeTown store is expected to open in Denver, CO during August. Overseas, the company is planning to open NikeTown stores in Berlin, Germany during April and London, England during July. Domestically, the company plans to open additional outlet stores, which more low-key than NikeTowns. Select Comfort Corporation (612-551-7007) which designs, manufactures and markets a line of patented air beds, as well as foundations and sleep accessories under the Select Comfort brand at 265 Select Comfort retail stores, plans to open 75 additional stores in 1999 and is currently building its third manufacturing and distribution facility in Salt Lake City, UT which will open in 1999. The company’s other facilities are located at its headquarters in Minneapolis, MN and in Columbia, SC. Hastings Entertainment, Inc. (806-351-2300) plans to open a 24,750 sq.ft. store in Normal, IL during Spring. It will be the company’s first location in IL. Celebrating its 30th year in entertainment retailing, Hastings currently operates 129 superstores in 18 states, with more than 2.7 million sq.ft. of retail space. It has steadily and profitably built its base of superstores, which average 21,200 sq.ft., since developing and implementing the entertainment superstore format in 1991. Bakersfield, CA will soon be home to a new Home Depot (770-433-8211), the company’s second store in the market; a Ralph’s Supermarket (310-884-2875) and a Save Mart (209-577-1600) at Stockdale Village. Osco Drug (801-961-5767), which operates 72 stores in AZ, is planning to add nine stores throughout the state this year. The stores will average 15,000 sq.ft. Polo Ralph Lauren (212-318-7688) plans to open a 45,000 sq.ft. site, 24,000 sq.ft. of which will be retail, on New Bond Street in London, England during April. Kohl’s Department Stores (414-703-7000) has filed a plan to develop an 86,584 sq.ft. store on 14.2 acres of land located at the northeast corner of US 377 and Bursey Road in Keller, TX. The company is reportedly looking to open as many as 10 Metroplex locations during October. The company has already purchased sites in Arlington and North Richland Hills. Discount Auto Parts (941-687-9226) recently opened its 500th store and is planning to open as many as 110 new stores across the Southeastern region during its upcoming fiscal year. Sandbox Sandwich Cafe (212-713-1558), which currently operates three restaurants in New York City, is planning to be operating 25 throughout Manhattan by 2000. The stores average 900 sq.ft. and are dominated by a wall-length reach-in refrigerator. A staffed counter features soups, stews, coffees and fresh juices. The stainless steel, interior lighting of the refrigeration units, and glass and blond wood accents create a streamlined environment. Each store has 15 seats, but 95% of customers prefer to grab-and-go. Twenty percent of sales are breakfast and coffee items, making lunch the primary daypart. Sandbox is developing a dinner menu with Chef Motee that will debut next month. The company is negotiating $3 million in private funding to support the development of 22 stores in the next 18 months. Long-term plans include expansion to other major metropolitan areas. Albertson’s (208-385-6200) recently had its request to build a 60,000 sq.ft. supermarket that would have been open 24-hours-a-day in Old East Dallas, TX denied by the City Plan Commission. The commissioners felt that the project would have created more traffic than the area could handle. Footaction USA (214-501-5000) is testing a new store design at Town East Mall in Mesquite, TX. The 18,000 sq.ft. store, the company’s largest, will test the company’s new displays, graphics, fixtures and footwear presentation for possible future locations, though more stores as large and all-inclusive as the Mesquite site are not planned. The industrial metal and athletic themed store, the company’s 565th, includes a 11,000 sq.ft. sales floor with more than 50 television monitors. The store also includes a centrally-located area called "The Block" which features video games, music CDS, television monitors and two pay phones. The company tested some 10,000 sq.ft. to 12,000 sq.ft. stores earlier this decade, but the results were disappointing. Michaels Arts & Crafts (214-409-1477) plans to open a 25,000 sq.ft. store in a portion of a former Best Products store, that has been vacant since December 1996, in Tacoma, WA during April. The center will be renamed Micahels Plaza and a tenant will be sought for the additional 25,000 sq.ft. of space. Goody’s Family Clothing (423-966-2000) plans to relocate is 12-year-old store at Village Plaza Center to a new 40,000 sq.ft. location at Augusta Exchange in Augusta, GA and it nine-year-old store at Colony Plaza Center to a 22,500 sq.ft. location on Georgetown Drive in Augusta, GA during August. The store at Augusta Exchange will be larger than the chain’s average size. Most stores range from 25,000 sq.ft. to 35,000 sq.ft. It will also be located close to department stores such as Target. The Augusta Exchange is a rapidly expanding shopping center with department stores, restaurants and a grocery store. A 20-screen movie theater is expected to open there later this year. Goody’s has upgraded more than half of its 257 stores in the past two years with new racks and a more elegant, updated look. Pride Auto Sales/Service (508-336-7880) plans to open a 13,000 sq.ft. automotive service center featuring a parts department, service department and car wash on Draper Avenue in North Attleboro, MA. Jewel-Osco (708-531-6511) recently opened a 70,000 sq.ft. supermarket/drug store at the intersection of US Route 41 and Deerfield Road in Highland Park, IL. The store replaces a 33,000 sq.ft. store located on Central Street that the company had operated since 1962. Ranch*1 (212-956-1111), which operates 35 restaurants in New York City, NJ, CT and the Washington, D.C./Baltimore, MD areas recently signed a deal to open 35 franchised units in Taiwan in the coming five years. Domestically, the company is planning to open 20 stores before the end of May with the goal of operating 500 restaurants within five years. The Sport Shoe (770-279-7494) plans to open a 14,400 sq.ft. store in Macon, GA during June and a 15,000 sq.ft. store in Buford, GA, across from the Mall of Georgia, during July. Both Expo superstores will feature indoor running tracks. Currently, the company operates 25 stores in five Southeastern states. New Construction Florida Property Investment Partners, Inc. recently broke ground on
phase I of Hamptons Plaza, located at the intersection of McNab Road and Rock
Island Road in North Lauderdale, FL. The project will be anchored by a 15,120 sq.ft. Walgreens
Drug Store with a drive-through. The store is expected to open during August. The
project is the 11th Walgreens unit developed by Florida Property Investment Partners.
Accompanying Walgreens will be a phase II development of retail and restaurant space up to
11,700 sq.ft. and office/professional space in three separate buildings totaling 22,800
sq.ft. North American Properties Southeast recently broke ground on a
shopping center in East Manatee, FL. The 16-acre site will be anchored by a 51,420 sq.ft. Publix
Supermarket, two restaurants, a beauty salon, a jewelry store and a combination
coffee/pizza shop. In all, there are 20 spaces to fill at the 16-acre project. Zelman Dadeland, L.P., an entity of Zelman Retail Partners, Inc.,
recently closed on the first of two tracts of land they have assembled across from Dadeland
Mall on Kendall Drive in Dade County, FL. The 2.1 acre tract of land was acquired from
First Union National Bank for $5 million. Next month, the company is expected to
close on the adjoining 5.4 acre Sun Chevrolet property and commence construction of
their planned 104,000 sq.ft., $30 million specialty retail power center. The new Shoppes
at Dadeland will include the first The Container Store in FL, a two-story Linens
‘N Things, an Old Navy Clothing Co. and a Just For Feet store. The
project is expected to open during November. Buyers & Sellers Simon Property Group has put 15 of its smaller malls up for sale.
Included are three projects in MD; two in TX and two in OH. The Feil Organization recently acquired a portfolio of 13 net
leased properties nationwide, as well as commercial and retail properties in New York
City, totaling over 1.3 million sq.ft. The net leased property transaction included 11
retail and two industrial properties representing approximately 700,000 sq.ft. Net lease
tenants include Kmart, Rite Aid, Flemming Companies, Mercantile/Dillards, Walgreen’s
and Consolidated Stores. The properties are located in CT, FL, IL, IN, MO, PA, TN and TX.
The company also acquired Concourse Plaza Shopping Center, located on the Grand Concourse
in the Bronx, NY. The 250,000 sq.ft. project was purchased as a joint venture with Kimco
Realty and is anchored by Super Waldbaum’s, Foot Locker, Kids Town, National
Amusements Multiplex Theater and an enclosed 30,000 sq.ft. food court. Westport Commercial Realty, Ltd. has the listing to sell a net
leased Home Base in Seattle, WA. The 114,000 sq.ft. project has a projected delivery date
of October 2000. The asking price is based on a 9.5% cap rate. Crossover Commercial Group, Inc. has the listing to sell a 17,760
sq.ft. strip center in Palm Bay, FL. The project contains three buildings with 24 units,
23 of which are currently occupied. Projected NOI is $90,312. The asking price is
$900,000. The Keyes Company has the listing to sell a newly constructed
Eckerd Drug store in GA. The project has a 20-year NNN lease. The asking price is $2.316
million. The company has the listing to sell four ground leases in FL. The projects has
NNN leases with increases every five years. The company also has the listing to sell a
Hollywood Video store in Charleston, SC. The newly constructed project has a 15-year NNN
lease. The asking price is $969,000. West Side Property Group, LLC represents clients in the market to
acquire shopping center portfolios with Kmart, Wal*Marts and supermarkets nationwide. The
company also represents clients in the market to acquire shopping centers which have dark
anchors or are completely vacant. Sperry Van Ness has the listing to sell a Chevron gas station with
convenience store and drive thru in Cathedral City, CA. The project has a 20-year NNN
lease with rent increases of 10% every five years. The asking price is $1.125 million. The
company also has the listing to sell a Jack In The Box restaurant and gas station in Palm
Desert, CA. The tenant has a 20-year NNN leases with 12% increases every five years.
Annual NOI is $189,000. The asking price is $2.35 million. Commercial Real Estate Specialists, Inc. has the listing to sell
West Broadview Centre in Cape Girardeau, MO. The asking price is $400,000. W.F. Chesley Real Estate, Inc. has the listing to sell an eight
acre shopping center site and a 1.4 acre pad in Prince George’s County, MD. The
project will be anchored by Aldi, Inc., a national grocery retailer that averages 700 to
1,000 customers a day. Up to 85,000 sq.ft. of retail space could be built on the
undeveloped site with a five-mile population of 329,423 earning $47,296 as the average
family income. The asking price is $6 psf. Financial News The Good Guys! (650-615-5000) reported that its net earnings for its first fiscal quarter fell to $1.7 million from $2.4 million during its first quarter last year. Sales for the quarter increased one percent to $294.1 million from $290.3 million last year with comparable store sales down two percent. The company currently operates 79 consumer electronics stores in CA, NV, OR and WA. Winn-Dixie Stores, Inc. (904-783-5000) reported that its second quarter sales increased 2.7% to $4.3 billion from $4.2 billion during its second quarter last year. Comparable store sales were flat. Net earnings fell to $52.4 million from $56.1 million last year. During the second half of last year, the company opened 43 stores, averaging 50,800 sq.ft., closed 32 stores averaging 33,500 sq.ft., enlarged 16 stores and remodeled 20 stores. By the end of its current fiscal year, the company plans to have opened 84 new stores and enlarged or remodeled 74 existing stores. The company currently operates 1,179 supermarkets. Garden Fresh Restaurant Corp. (619-675-1600), operator of the Souplantation and Sweet Tomatoes restaurants, reported that net sales for its first fiscal quarter increased 18.8% to $28.4 million from $23.9 million during its first quarter last year. Comparable store sales increased 5.3% for the quarter. Net income increased 43.5% to $841,000 from $586,000 last year. The company currently operates 58 salad buffet restaurants in AZ, CA, FL, GA, NV, NM, OR, TX, UT and WA. Au Bon Pain Co., Inc. (617-423-2100) reported a third quarter net loss of $18.2 million, compared to net income of $1.5 million during the third quarter last year. For its fourth quarter, the company now expects to report comparable restaurant sales of approximately 2.7% for the Saint Louis Bread Co. business unit and 2.3% for the Au Bon Pain business unit. Ron Shaich, ceo and co-chairman commented that "the restatement of third quarter earnings merely reflects an early recognition of the one-time non-cash writedown associated with the sale of the Au Bon Pain Business Unit. Furthermore, in late December, the buyer informed the company that although its original proposed lender had withdrawn its financing commitment relative to the acquisition of the Au Bon Pain Division, the buyer had obtained sufficient financing commitments from new lenders to consummate the transaction. The buyer’s financing is now under commitment and the SEC review process is now complete. As a result, we anticipate the Au Bon Pain transaction will close after the shareholders’ meeting scheduled for late this month. This will enable the restructured company to focus its capital and human resources entirely on Saint Louis Bread Co. We believe that Saint Louis Bread concept offer an extraordinary opportunity for our investors long-term, and we look forward to being able to take full advantage of the opportunity starting early in 1999." Musicland Stores Corporation (612-932-7700) reported that its 1998 net earnings increased 172% to $38 million from $14 million during 1997. Total sales increased 4.4% to $1.85 billion from $1.77 billion with comparable store sales up 6.7% for the year. During the fiscal year, the company opened 14 stores (five Sam Goody stores, two Suncoast Motion Picture Company stores, one Media Play and six On Cue stores) and closed 31 stores (22 Sam Goody/Musicland stores, six Suncoast stores, one On Cue store and two United Kingdom stores). Currently, the company operates 1,346 stores (696 Sam Goody/Musicland stores, 405 Suncoast stores, 69 Media Play stores, 162 On Cue stores and 14 United Kingdom stores) in 49 states, Puerto Rico, the Virgin Islands and the United Kingdom. Ryan’s Family Steak Houses, Inc. (864-879-1000) reported that its 1998 restaurants sales increased to $637 million from $599.2 million last year. Net earnings for the year increased to $40.3 million from $39.2 million last year. The company currently operates and franchises 306 restaurants. Starbucks Corporation (206-447-7954, www.starbucks.com) reported that consolidated net revenues for its first quarter increased 26% to $406 million from $321 million during its first quarter last year. Retail sales for the quarter increased 25% to $343 million and specialty sales increased 36% to $63 million. Comparable store sales increased three percent for the quarter. Net earnings increased 28% to $26.7 million from $21 million last year. The company operates more than 2,000 retail locations throughout North America, the United Kingdom and the Pacific Rim. The Grand Union Co. (201-890-6000) reported that its third quarter net loss was $26.7 million, compared to a net loss of $47.9 million last year. Sales remained flat at $527.7 million. However, the company reported that its cash flow, profit before operating expenses, was up 14.9% to $30.1 million, the second consecutive quarterly increase. The company, which operates 222 supermarkets, emerged from bankruptcy protection six months ago. The Dress Barn, Inc. (914-369-4600) reported that its second quarter sales increased one percent to $146.2 million from $144.2 million last year with comparable store sales down four percent. The company currently operates 673 stores in 42 states. Lead Sheet Haggar Direct Apparel The 60-unit chain operates locations nationwide. The men’s apparel stores occupy spaces of 2,700 sq.ft. in outlet centers. Plans call for 15 openings in the coming 18 months. Expansion will take place nationwide. Preferred demographics include a population of 100,000 within 10 miles earning $50,000 as the average household income. Leases running five years, with a five-year option, are typical. S&K Famous Brands Apparel The 211-unit chain operates locations in 30 states. The men’s apparel stores occupy spaces of 3,000 sq.ft. to 6,000 sq.ft. in freestanding facilities, regional malls, outlet, power and strip centers. Preferred co-tenants include T.J. Maxx, department stores, women’s apparel stores, shoe stores and sporting goods stores. Plans call for 50 openings in the coming 18 months. Expansion will take place in the eastern two-thirds of the country. Preferred demographics include a population of 150,000 within 10 miles earning $40,000 as the average household income. Leases running five years, with a 15-year option, are typical. TVI Inc. Apparel The 185-unit chain operates locations in AK, AZ, CA, CO, FL, HI, ID, MA, MI, MN, NE, NV, NM, NY, OH, OR, RI, SD, TX, UT, WA, WI and Canada. The stores, selling new and used apparel, as well as furniture and household items, occupy spaces of 18,000 sq.ft. to 22,000 sq.ft. in freestanding facilities, power and strip centers. Plans call for 15 openings during 1999. Expansion will take place throughout North America and Australia. Leases running 10 years, with four options of five years each, are typical. Hancock Fabrics, Inc. Arts/Crafts/Fabrics The 486-unit chain operates locations nationwide. The stores, selling arts, crafts and fabrics, occupy spaces of 13,000 sq.ft. to 20,000 sq.ft. in freestanding facilities, power, specialty and strip centers. Preferred co-tenants include drug stores, discount stores and supermarkets. Plans call for 40 openings in the coming 18 months. Expansion will take place nationwide. Preferred demographics include a population of 60,000 within three miles earning $25,000 as the average income. Leases running 10 years are typical. Oliver & Winston, Inc. Automotive The 190-unit chain operates locations in AZ and CA. The stores, offering automotive and tire services, occupy spaces of 5,300 sq.ft. in freestanding facilities. Growth opportunities are sought in the Western region. Preferred demographics include a population of 100,000 within three miles earning $50,000 as the average income. Leases running 10 years are typical. Gas America Services, Inc. Convenience Store The 56-unit chain operates locations in OH and IN. The convenience stores occupy spaces of 2,500 sq.ft. in freestanding facilities. Preferred co-tenants include fast food restaurants. Plans call for five openings in the coming 18 months. Expansion will take place in the existing markets. Kangaroo, Inc. Convenience Store The 47-unit chain operates locations in GA. The convenience stores occupy spaces of 3,800 sq.ft. in freestanding facilities. Plans call for 15 openings in the coming 18 months. Expansion will take place in the existing market. Ashland Petroleum LLC Convenience Store The 2,400-unit chain operates locations in AL, FL, GA, IL, IN, KY, LA, MI, MN, MS, ND, NC, OH, SC, SD, TN, WI and WV. The convenience stores occupy freestanding facilities on one acre of land. Plans call for 10 openings in the coming 18 months. Expansion will take place in FL, Minneapolis, MN; Chicago metro area, IL and New Orleans, LA. Genovese Drug Stores, Inc. Drug Store The 127-unit chain operates locations in CT, NJ and NY. The drug stores occupy spaces of 12,000 sq.ft. in freestanding facilities and strip centers. Plans call for 10 openings in the coming 18 months. Expansion will take place in the existing markets. Leases running 20 years are typical. Hirshfield’s, Inc. Home Furnishings The 22-unit chain operates locations in MN. The home furnishing stores occupy spaces of 3,000 sq.ft. to 6,000 sq.ft. in freestanding facilities and strip centers. Plans call for two openings in the coming 18 months. Expansion will take place in IA. Preferred demographics include a population of 60,000 within five miles earning $80,000 as the average income. The company prefers a vanilla shell. Westco Group, Inc. Home Furnishings The 45-unit chain operates locations in IN, KS, KY, MO, OH and TN. The stores, selling bedding, occupy spaces of 7,000 sq.ft. to 10,000 sq.ft. in freestanding facilities, regional malls, power and strip centers. Preferred anchors include bog box retailers. Plans call for as many as eight openings in the coming 18 months. Expansion will take place in KS and MO. Preferred demographics include a population of 100,000 within five miles earning $50,000 as the average income. Leases running five years are typical. Crown Hardware, Inc. Home Improvement The nine-unit chain operates locations in Orange County, CA. The stores, selling tools and hardware, occupy spaces of 10,000 sq.ft. to 15,000 sq.ft. in power and strip centers. Plans call for as many as two openings in the coming 18 months. Expansion will take place in the existing market. Leases running 10 years, with options, are typical. Grimes Ace Hardware Co., Inc. Home Improvement The eight-unit chain operates locations in OH. The hardware stores occupy spaces of 15,000 sq.ft. to 17,500 sq.ft. in freestanding facilities and strip centers. Preferred co-tenants include big box retailers. Plans call for as many as two openings in the coming 18 months. Expansion will take place in the existing market. Leases running 10 years, with options, are typical. Scotty’s, Inc. Home Improvement The 150-unit chain operates locations in AL, FL and GA. The home improvement stores occupy spaces of 8,000 sq.ft. to 40,000 sq.ft. in freestanding facilities and strip centers. Preferred anchors include big box users and supermarkets. Plans call for as many as 10 openings in the coming 18 months. Expansion will take place in the existing markets. Preferred demographics includes a population of 30,000 within five miles earning $25,000 as the average income. Leases running five years are typical and the company prefers a vanilla shell. Window Works International, Inc. Home Improvement The 12-unit chain operates locations in CO, IL, IN, MA, MI, MN, OH and TX. The stores, selling window treatments and accessories, occupy spaces of 1,000 sq.ft. to 1,500 sq.ft. in strip centers. Growth opportunities are sought in the existing markets. Preferred demographics include a population of 100,000 within 10 miles earning $40,000 as the average income. Leases running five years are typical. Sterling, Inc. Jewelry The 48-unit chain operates locations nationwide. The fine jewelry stores occupy spaces of 1,200 sq.ft. in regional malls. Growth opportunities are sought nationwide. DC Ventures Music The 30-unit chain operates locations throughout IN. The stores, selling pre-recorded music, occupy spaces of 2,000 sq.ft. to 3,000 sq.ft. in strip centers. Preferred anchors include supermarkets. Plans call for two openings in the coming 18 months. Expansion will take place in the existing market. Leases running four years are typical and the company, which prefers a vanilla shell, is licensing its concept. Value Music Concepts, Inc. Music The 45-unit chain operates locations in 23 states. The stores, selling pre-recorded music, occupy spaces of 3,000 sq.ft. in outlet centers. Plans call for 12 openings in the coming 18 months. Expansion will take place nationwide. Preferred demographics include a population of 50,000 within 10 miles earning $40,000 as the average income. Leases running five years are typical. Cole Vision Corp. Optical The 1,130+-unit chain operates locations nationwide. The optical stores occupy spaces of 1,000 sq.ft. to 1,200 sq.ft. in freestanding facilities, regional malls, power and strip centers. Plans call for 75 openings in the coming 18 months. Expansion will take place nationwide. Packaging and Shipping Specialist Service The 447-unit chain operates locations nationwide. The stores, offering US Mail and UPS shopping services, color copying services, fax services and mail box rentals, occupy spaces of 1,000 sq.ft. to 1,500 sq.ft. in outlet, power and strip centers. Plans call for 75 openings in the coming 18 months. Expansion will take place nationwide. Spirit Halloween Superstore Specialty The 50-unit chain operates locations in AZ, CA, LA, MN, NM, NY, TX, WA and WI. The stores, selling Halloween costumes and accessories, occupy spaces of 5,000 sq.ft. to 30,000 sq.ft. in regional malls and strip centers. Growth opportunities are sought in the Midwestern region. Leases running three months are typical. The Grand Union Co. Supermarket The 222-unit chain operates locations in CT, MA, NH, NJ, NY, PA and VT. The supermarkets occupy spaces of 30,000 sq.ft. to 65,000 sq.ft. in downtown store fronts, freestanding facilities and strip centers. Growth opportunities are sought in NJ and NY. Wakefern Food Corp. Supermarket The 189-unit chain operates locations in CT, DE, NJ, NY and PA. The supermarkets occupy spaces of 55,000 sq.ft. to 70,000 sq.ft. in downtown store fronts, freestanding facilities, power and strip centers. Preferred co-tenants include Home Depot and Lowe’s. Growth opportunities are sought in the existing markets. Preferred demographics include a population of 40,000 to 60,000 within three to five miles earning $20,000 as the average income. Leases running 20 years are typical. Bankruptcy News Barney’s Inc. (212-450-8699) recently emerged from two years of bankruptcy protection. Barney’s received $62.5 million in equity from its former creditors. The company’s primary plan investors, Bay Harbour Management and Whippoorwill Associates, Inc., now collectively own 70% of Barney’s outstanding common stock issued in accordance with the plan. The company filed for bankruptcy court protection in January 1996 in a dispute with Japan’s Isetan Co., which had financed the company extensive expansion. Fall Leather Gallery (305-621-0888) recently filed for Chapter 11 protection after suffering from a cash flow problem caused by expanding too rapidly. The company has been trying to position itself as the regional leader in the sale of leather furniture, expanding from one store to 10 in the past nine years. The company was preparing to add another five stores over the next several years. However, that strategy proved too ambitious for the family-owned company which has a bulk of its capital tied up in adding new stores. The company says that all 10 stores are profitable and the company generates about $20 million in annual sales. The retailer’s 10 stores each filed individually with the number of creditors for each store between 200 and 900, with estimated assets between $100,000 and $500,000 and estimated debt between $500,000 and $1 million. The company does not plan to close any stores. The company operates stores on both coasts of FL, including Kendall, Northwest Dade, Fort Lauderdale and Sunrise. The company closed its South Beach store at the end of last year. Solo Serve Corp. (210-662-6262) recently filed for Chapter 11 protection listing assets of $15.2 million and liabilities of $19.1 million. The filed for protection after posting a net loss of $6.6 million for its fiscal year, compared to a net loss of $5.5 million during 1997. As late as last month, the company said that it would be forced to sell all or some of its assets or file for bankruptcy protection if it couldn’t obtain more credit or equity financing. The company’s largest creditor with unsecured claims is Model Imperial, Inc. which is owed $522,551. The filing is the company’s second in the last five years. It filed for Chapter 11 protection in July 1994 and emerged in July 1995. The company operates 30 stores in LA and TX which specialize in selling a wide range of apparel and accessories at low prices. The company plans to close four stores in TX and exit the LA market altogether. A decision on the remaining 20 stores is expected soon. County Seat Stores, Inc. (212-714-4810) and CSS Trade Names, Inc. a wholly-owned subsidiary, recently filed voluntary petitions for reorganization under Chapter 11 of the bankruptcy code. County Seat also announced that it has obtained a $70 million debtor-in-possession financing commitment, including a $50 million sub-limit for letters of credit, from BankBoston Retail Finance Inc. The company has also received an additional $5 million debtor-in-possession financing commitment from BackBay Capital Funding, LLC. Upon court approval, these financings will enable the company to meet future inventory needs and fulfill obligations associated with operating its business, including payroll and the prompt payment for merchandise received subsequent to the filing. The company has been unable to overcome severe liquidity problems relating, in large part, to an approximate 12% decline in same-store sales for the 1998 third quarter. The County Seat is the among the nation’s largest mall-based specialty retailers of casual apparel, operating 418 stores in 41 states, including 375 County Seat stores, 15 Count Seat Outlet Stores, 22 Levi’s Outlet stores and six Old Farmer’s Almanac General Stores. J. Peterman (606-268-0990) recently filed for Chapter 11 protection and obtained $1.96 million loan while it seeks a buyer or new financing. The company listed $40 million in liabilities and $35 million in assets. 1998 sales totaled $50 million, $34 million of which came from its catalog and $16 million from its 13 stores. During 1997, sales totaled $65 million. At one time, the company planned to open 50 stores and 20 catalog outlets. No stores are planned to be closed at this time. Juice Stop (303-316-0797), a national retailer of fresh fruit smoothies, recently filed for Chapter 11 protection. The company plans to keep all of its store open during the reorganization. An overly aggressive growth plan coupled with undercapitalization was blamed for the filing. Bradlees, Inc. (617-380-5863) is looking to sell its leasehold interest in its store at Union Square in New York to Dostra Realty Co., an affiliate of Bradlees. Bradlees’ game plan, which requires bankruptcy court approval, includes holding an auction on March 16 to try to sell the lease interest. Bidding procedures include a minimum initial bid of $12 million, with incremental bids of $100,000. Bradlees has also reserved the right to reject offers. If the lease is not sold, Dostra would enter into a sublease agreement with Bradlees, and the discounter would continue operating its store at the site. Lease Signings The Sembler Company (813-384-6000) leased 1,200 sq.ft. to Pak Mail at Publix at Acworth in Acworth, GA; 4,250 sq.ft. to Dollar Tree Stores at Bayside Bridge Plaza in Clearwater, FL; 6,000 sq.ft. to Sue’s Hallmark at Causeway Shopping Center in Melbourne, FL; 9,688 sq.ft. to BuddyFreddy’s and 2,343 sq.ft. to Radio Shack at Clearwater Collection in Clearwater, FL; 1,280 sq.ft. to Subway at Deltona Landings in Deltona, FL; 1,227 sq.ft. to Subway at Home Depot Plaza in Port Richey, FL; 4,673 sq.ft. to Dollar Tree Stores at Sheridan Square in Dania, FL and 2,675 sq.ft. to Payless ShoeSource, 2,150 sq.ft. to Pearle Vision Center; 2,150 sq.ft. to Subway at Juncos Plaza in Juncos, Puerto Rico; 25,600 sq.ft. to Beall’s Outlet at Westgate Plaza in St. Cloud, FL and 3,000 sq.ft. to Dollar Discount and 1,600 sq.ft. to Sally Beauty Supply at Willow Bend Towne Centre in Land O’Lakes, FL. R.E.D. Capital Management (602-947-7772) leased space to Banana Republic and Talbots at SouthPointe Pavilions in Lincoln, NE. The two retailers will join Von Maur, Old Navy, Barnes & Noble and Bed Bath & Beyond. A grand opening celebration is expected to take place August, following completion of Von Maur’s store. Metro Commercial Real Estate, Inc. (609-866-1900) leased 3,747 sq.ft. to Kay Bee Toys at Gallery II in Philadelphia, PA and 1,535 sq.ft. to GNC at Manchester Plaza in Manchester, NJ. CCR McCaffery Developments (312-944-3777) leased space to General Cinemas for a seven-screen movie theater at Mazza Gallerie in Washington, D.C. The theater will join anchor Nieman Marcus. Trammell Crow Company (561-394-3388) leased 9,693 sq.ft. to Noodle Kidoodle at Plantation Crossing in Plantation, FL. Noodle Kidoodle, which also recently completed a lease transaction for a Miami location, plans to open its Plantation store this month or next. The company has more than 42 stores throughout the nation and is currently expanding throughout FL. Trammell Crow represents Noodle Kidoodle in all of the company’s FL real estate transactions. Real Estate Professionals Making The News Brinker International, Inc. (972-980-9917) announces the election of Ron McDougall to vice chairman, a post he will add to his duties as chief executive officer. As vice chairman and CEO, McDougall will continue to guide and direct the long-term direction of the company. He is credited with spearheading the turnaround at the company during the past three years by adding on-trend, high potential concepts and divesting non-strategic assets. The company also announces the promotion of Doug Brooks to president and chief operating officer. Brooks will continue overseeing the operations of the company’s nine concepts. Claire’s Stores, Inc. (847-765-1100) announces that Eileen Bonnie Schaefer has been named vice chairman. Schaefer joined the company in 1990 and most recently served as vice president-real estate. She also has been involved in store operations and has carried responsibility for development of the company’s southeastern and Puerto Rican operations. She was elected to Claire’s board of directors in June 1998. Claire’s, the world’s leading mall-based retailer of popular-priced accessories and costume jewelry for teenagers, currently operates more than 2,000 Claire’s Accessories and The Icing Stores in the U.S., Canada, the Caribbean, Japan, United Kingdom, Switzerland, Austria and Germany. Dayton Hudson Corporation (612-370-6948) announces the appointment of Brigid Bonner to the new post of vice president, e-commerce, technology and strategy. In her new role, Bonner will be responsible for coordinating the company’s diverse electronic retailing initiatives. Most recently, Bonner was vice president of network and computer services for Dayton Hudson Information Services. She joined the company in March 1994 as director, planning, information management and emerging technologies. Neiman Marcus (214-741-6911) announces that H.W. Mullins has been promoted to vice-chairman, a new position at the chain that broadens his role by giving him supervision over the stores’ organization. Mullins, formerly executive vice-president, will continue to head merchandising and sales promotion and oversee the fashion office. Bed Bath & Beyond Inc. (908-688-0888) announces the following promotions: Arthur Stark to senior vice president-merchandising; Matthew Fiorilli to senior vice president-stores; Martin Lynch to vice president of stores-Midwest and Western region; William Onksen to vice president of stores-Mid-Atlantic region; Edward Kopil to vice president of stores-Southern region; Martin Eisenberg to vice president of stores-Northeast region; P. Timothy Brewster to vice president of stores-New York City and Long Island; Allan Rauch to vice president legal and general counsel and Alan Jacobson to senior regional-Western region. Since the beginning of its current fiscal year on March 1, 1998, the company has opened 44 stores and currently operates 185 stores in 34 states. The company expects to open one additional store before the end of its fiscal year on February 27. During fiscal 1999, which ends on February 26, 2000, the company expects to open approximately 50 stores. The Cheesecake Factory (818-880-9323) announces that Michael Nahkunst, executive vice president and chief operating officer, has left the company to pursue other opportunities. A search is underway for a seasoned and creative executive to fill this position. The company operates 27 upscale, casual dining restaurants with an extensive menu offering more than 200 items. Restaurants are located in Southern CA (8), Washington, D.C. (2), Southern FL (5), Chicago, IL (2), Atlanta, GA; Baltimore, MD; Boston, MA (2); Dallas, TX; Denver, CO; Houston, TX; Kansas City, MO; Las Vegas, NV and Westbury, NY. CKE Restaurants, Inc. (714-778-7136) announces that Jim Sill has been promoted to regional vice president for Carl’s Jr.’s newly created region 10. He will oversee operations for 52 Carl’s Jr. restaurants in a territory that includes Simi Valley, Santa Barbara, Bakersfield and CA’s central coast. The company announces the promotion of Connie Codon to director, franchise administration. She will oversee franchise contracts for all Carl’s Jr. and Hardee’s franchise development in the U.S. and Mexico. The company also announces that Colleen Ford-McDonough has been named director, real estate asset management. In her new position, Ford-McDonough will oversee the management of more than 1,000 real estate assets for all subsidiaries of CKE Restaurants, Inc. and Santa Barbara Restaurant Group including the negotiation and restructuring of maturing leases, excess property disposition and property acquisitions. CKE Restaurants, Inc., through its subsidiaries and its franchisees and licensees, operates 783 Carl’s Jr. restaurants in AZ, CA, NV, OR and Mexico; 2,880 Hardee’s restaurants in 34 states and 11 foreign countries; 111 Taco Bueno units in OK and TX and 26 Rally’s restaurants in AZ and CA. Space Place Colorado Aurora- Hoffman Heights Center is anchored by Ace Hardware, Brunswick Recreation Center and Video Buffs. The 240,000 sq.ft. project has spaces of 672 sq.ft., 1,200 sq.ft. and 4,800 sq.ft. available for lease. Demographics include a three-mile population of 150,000 earning $45,000 as the average income. The site is located near King Super, McFrugals and Family Dollar. For details, contact Lyle Shelor of AAMS Corp. at (800-544-8585), Fax (847-674-8157). Iowa Denison- Denison Plaza is anchored by Dollar General. The 35,000 sq.ft. project has a 26,600 sq.ft. space, which is divisible, available for lease. Demographics include a three-mile population of 3,111 earning $30,820 as the average income. In Grinnell- Grinnell Plaza, a 32,200 sq.ft. project, has 26,600 sq.ft. available for lease. Tenants being sought include service and home furnishing tenants. Demographics include a city population of 8,729 earning $59,536 as the average income. In Storm Lake- Storm Lake Plaza is a 56,564 sq.ft. project with 18,560 sq.ft. available for lease. Tenants being sought include hardware and home improvement tenants. Demographics include a three-mile population of 9,780 earning $33,544 as the average income. For details, contact Susan Coyan at Noddle Development Company at (402-496-1616), Fax (496-6250). Kansas Topeka- Barrington Village has spaces of 1,270 sq.ft., 1,748 sq.ft. and 5,541 sq.ft. available for lease. Also in Topeka- A 107,400 sq.ft. former Builders Square store is available for lease. The site is located near Westridge Mall, Hobby Lobby and Kmart. Demographics include a three-mile population of 48,302 earning $60,474 as the average income. Also in Topeka- A 109,000 sq.ft. former Venture Store is available for lease at Fairlawn Plaza Shopping Center. Anchor tenants at the site include OfficeMax and Walgreens. Demographics include a three-mile population of 66,609 earning $56,812 as the average income. Also in Topeka- A 15,000 sq.ft. space is available for lease fronting Wanamaker Road. The project is anchored by adjacent to Office Depot and directly across from Westridge Mall. Demographics include a three-mile population of 48,302 earning $60,474 as the average income. For details, contact Ken Schmanke of KS Commercial Real Estate Services, Inc. at (785-228-5305), e-mail (ken@kscommercial.com), home page (www.kscommercial.com). Virginia Chester- Bermuda Crossroads Plaza, which is under development, will be anchored by OfficeMax, a supermarket and a multi-screen theater. The 145,000 sq.ft. project has spaces from 2,000 sq.ft. to 60,000 sq.ft., as well as outparcels, available for lease. For details, contact Tred Spratley of Sigma National at (804-320-6100), Fax (320-6660). Mergers & Acquisitions The CML Group (978-264-4155), which is operating under Chapter 11 protection, plans to sell its last remaining asset Smith & Hawken, which generated a net profit of $2.8 million on $88 million in revenue. CML Group is the former owner of NordicTrack, but sold that division to Icon Health & Fitness for $12 million in November. Lowe’s Companies, Inc. (336-658-4223) and Eagle Hardware & Garden, Inc. recently announced that the waiting period for action by the Federal Trade Commission on the Hart-Scott-Rodino Antitrust Improvements Act filing covering Lowe’s acquisition of Eagle has expired. The expiration clears the way for consummation of the transaction under federal antitrust laws. The deal is expected to be completed during the first quarter. Eagles Hardware & Garden operates 36 warehouse home improvement stores in 10 Western states and Lowe’s operates 474 home improvement stores in 26 states. Aaron Rents, Inc. (404-231-0011) recently acquired seven franchised Aaron’s Rental Purchase stores from ACI Investments, Inc. Three of the stores are located in VA, three in MD and one in NJ. The stores currently generate approximately $7.2 million in annual revenues. Aaron Rents purchased the assets of the franchise business for approximately $5.5 million in cash. The current franchisees plans to use the proceeds to open new franchised stores in other markets. Aaron Rents currently operates and franchises 429 stores in 32 states. Nathan’s Famous (516-338-8500) recently increased its bid to acquire Kenny Rogers Roasters from $1 million to $1.25 million. Before increasing its bid, Nathan’s and Franchise Management International were both tied at $1 million bids. Nathan’s currently operates 26 company-owned restaurants, 166 franchised units and more than 400 smaller units. Franchise Management International operates 20 Juicy Lucy’s hamburger restaurants in southwest FL. U.S. Restaurant Properties, Inc. (972-387-1487) recently completed the acquisition of a total of 22 fee simple restaurant properties from Spaghetti Warehouse in a $27.75 million transaction. The acquisition included the purchase of 19 restaurant properties located throughout the U.S. and three parking lots associated with the respective restaurant operations. U.S. Restaurant Properties acquired these properties in conjunction with Consolidated Restaurant Companies’ $62 million acquisition of Spaghetti Warehouse. CRC will retain and maintain all restaurant operations. CRC currently owns and operates 113 franchise or joint venture full service or casual dining restaurants. U.S. Restaurant Properties is a fully integrated, self-advised REIT. The company owns or manages 865 properties in 48 states on which Burger King, Arby’s, Chili’s and other fast food/casual dining restaurants and selected service stations are operates. Convenience USA LLC (919-477-4200) recently acquired the nine-unit McCracken Express convenience store chain of NC. The acquisition give Convenience USA 130 stores in FL, GA and NC. Convenience USA trades as Holiday Markets, Kwik Shop, Nugget Store and McCracken Express. NPC International, Inc. (316-231-3390), the world’s largest Pizza Hut franchisee, plans to buy 99 more Pizza Hut restaurants and delivery/carry-out units bringing the number of stores it operates to 742. NPC signed a letter of intent to buy the units, located in AL, FL and GA, for $31 million. The deal is expected to close this month. The company, which was founded in 1962, has been in a growth mode having acquired nearly 300 units from Pizza Hut and other franchisees in the past two years. Those acquisitions nearly doubled the size of the company. The company is interested in continuing to grow its market share through acquisitions. NPC International has an agreement with Pizza Hut that it can operate up to 1,300 units. In April, NPC announced that it was selling the majority of its interest in a chain of Tony Roma’s restaurants. NPC, through its subsidiary, Romacorp, Inc., operated 45 restaurants, with 147 more operated by franchisees. Sentinel Capital Partners bought Romacorp for $121.5 million. In another move, NPC is consolidating, relocating or updating its restaurants and delivery/carry out units. It is consolidating and moving 53 units to 45 new locations and will close 31 underperforming locations. |