The Belz Report, Summer 1999

1999, Volume 2PAGE 2

The Future of Factory Outlet Malls: Bigger, Better and More Popular than Ever
Outlet shopping malls are fast becoming a major tourist attraction for U.S. travelers, with nearly 40 percent of all leisure and business travelers saying they visited a factory outlet mall in the past year, according to the TIA Travel Poll conducted by the Travel Industry Association of America.

One in 10 factory outlet mall travelers cited the shopping experience as the primary reason for their trip.

This is not news to Andrew J. Groveman, president of Belz Enterprises' Factory Outlet Division, and John Ellis, vice president of leasing. Under their stewardship, Belz's Factory Outlet Division had combined sales of more than $500 million in 1998. The division is responsible for the development and leasing of more than 2.6 million square feet of leasable space.

"As pioneers in the industry, everyone knows us," Ellis said. "As a result of our solid reputation and the personal relationships we have developed with key executives over the years, close to 70 percent of the tenants we lease to in a new mall are already signed with us at another location. The best source of new business is existing business."

In addition to repeat business, Ellis attributes the success of the Factory Outlet Division to a good product and a great site. He explains that selecting a mall site can be the most important component to the success of the project. Geography, visibility and accessibility of the site all are essential ingredients to making the project work. The division also tries to select a site that is populated by at least 500,000 people in the surrounding area.

"No matter how good the tenant mix is, it's the traffic that makes or breaks you," Groveman said.

The Factory Outlet Division's determined efforts have clearly paid off as Belz enjoyed its biggest attendance year ever in 1998. A record 33.8 million people visited the five U.S.-based Belz Factory Outlet Malls last year – up 8 percent from 1997.

The Factory Outlet Division is staffed by a team of seasoned leasing agents including Ron Simkin, Jay Tillman and Ed Woods. Sandra Huskins, office manager for the Factory Outlet Division, works closely with Vicki Boykin, Melissa Counce and Doris Evans to help meet the division’s goals.

"Our division is very team-oriented," Ellis said. "Although we may assign one person to be primarily responsible for leasing an individual project, they will interact with team members to ensure the ultimate success of a project.”

One of the newest projects in the pipeline of the Factory Outlet Division is an outlet mall in St. Augustine, Florida. The enclosed, climate-controlled mall, which will offer 252,000 gross leaseable square feet in Phase I, is expected to open by August of this year. Remington Factory Outlet Store, Samsonite, Vitamin World, Hush Puppies, Adidas Company Store, Black & Decker, Nike, Easy Spirit, Danskin and Perfumania are among the prestigious and highly-recognizable retailers to sign on as Belz Factory Outlet World – St. Augustine's initial tenants. The mall is expected to open 90 percent leased, Groveman said.

Belz also is developing the first enclosed factory outlet mall ever built in Puerto Rico. Phase I of the much anticipated project, which will encompass 350,000 square feet, is expected to open by fall 2000. Belz Factory Outlet World–Canovanas will be comprised of five connected buildings, each with a different mood and streetscape depicting Old San Juan. The center's food court will feature a rain forest/entertainment theme with rockscapes and waterfalls. The project's initial phase will have approximately 80 tenants.

"Puerto Rico’s retail mix will closely resemble the mix in our Orlando and Las Vegas factory outlet developments," Groveman said. "This development will characterize a design that will represent an environment for the next century."

As the popularity of outlet shopping continues to grow, Groveman and Ellis are confident that the outlet shopping experience will hold a secure place in the business mix of the new millennium.

Photos (from top to bottom):

  1. Belz Factory Outlet World construction site – St. Augustine, Florida
  2. John Ellis and Andrew J. Groveman
  3. Factory Outlet Division support staff: (clockwise) Vicki Boykin, Doris Evans, Sandra Huskins, Kim Thomas. Not pictured: Melissa Counce
  4. Factory Outlet Division leasing team: Ron Simkin, Jay Tillman and Ed Woods

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