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Alabama outlets keeping up with changing trends

BIRMINGHAM (AP) — Outlet shopping centers across Alabama are changing as much as the fashions they sell, with some adding traditional retailers to replace factory-direct stores.

Tom Kirwan, senior editor of Value Retail News, which tracks outlet centers, said there are 225 outlet centers across the nation. That’s a 32 percent drop from the high of 329 in 1996, The Birmingham News reported.

To be counted as an outlet center, half or more of the shops in a development must be manufacturer-direct stores. Alabama has five shopping centers that fit that description: Tanger Outlet Center in Foley, WaterMark Place in Bessemer, and Tanger Outlet Center, Fashion Outlets and Factory Stores of America in Boaz.

Rural areas struggle

Some outlet centers not located in metropolitan or tourist areas have had a tough time in recent years. At Factory Stores of America in Boaz, more than half of the storefronts are vacant.

Graham and Janis Sisson, who have been visiting the outlet stores in Boaz for 24 years, said their pre-Christmas trip to the Factory Stores outlet center didn’t take as long as it once did.

“The quality that’s here is good,” Janis Sisson said. “There’s just not enough.”

Some centers, even in rural areas, are keeping their tenants. Tanger’s 79,000-square-foot outlet in Boaz has 100 percent occupancy, said Sara Holderfield, manager of that center.

“From our perspective, the industry is still quite strong,” Holderfield said. Tanger, because it is a national group, has more leverage to keep large manufacturer outlets in its centers, she said.

A few Alabama centers have changed their focus away from outlets to survive. One is 313,000-square-foot Boaz Outlet Center, which got new owners going bankrupt in the late 1990s. It still has one of the city’s biggest outlet stores — Westpoint Pepperell — but among the businesses that have moved into empty storefronts are bowling lanes, a theater, college bookstore and pet shop.

Shifting tenant mix

Amy Clem, property manager for Boaz Outlet Center, said 84 percent of the center is leased. The focus has been getting stores with value-priced goods and catering to families “as opposed to trying to restore the outlet ... that we think is on the decline,” Clem told The Birmingham News.

Another shopping center that has shifted its tenant mix is the 110,000-square-foot USA Town Center in Opelika.

Of the 28 or 29 spaces in the center, four or five are occupied by factory-direct stores, and eight to 10 are vacant, said Victor Vance of Lease America in Auburn.

He and several partners bought the center last year.

Vance said the owners are trying to maintain as many outlet tenants as they can and blend in local stores.

“The days of mom and pop (outlet) centers built on vacant land just because it’s on the interstate are over,” Vance said.

Fewer stores offered

Also, fewer manufacturers are offering factory-direct stores. The number of outlet chains was 329 in 2004, down from a high of 543 in 1995, according to Value Retail News.

WaterMark Place, a 185,000- square-foot outlet center that opened in 2000 next to what is now called Alabama Adventure theme park in Bessemer, is doing better after struggling, at first, to find tenants.

“The center has been doing extremely well in the last year,” said Lisa Wagner, president of Quier Marketing, a Maryland marketing consulting firm that works for WaterMark.

In 2005, the lender on the project, CapitalSource Finance LLC, began running it, Wagner said.

Sales are up 20 percent this year from last year, she said. The center is 16 percent vacant, but it has added stores including Lenox and Petite Sophisticate in the past year.

Early next year, a Bessemer Police Department substation is moving in, she said.

The center, however, has not been able to get tenants for its food court.

It’s a problem Wagner said is shared by centers that have light traffic during the week.

Not all outlet center woes can be blamed on shoppers’ habits, manufacturers or an overbuilt market.

Sales at the 557,000-square-foot Tanger Outlet Center in Foley suffered after Hurricane Ivan damaged the coast in 2004, said Foley Mayor John Koniar. But they seem to have bounced back, he said.

The center has added high-end stores including Talbots, Coldwater Creek and Starbucks.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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