Retailers Click To Brick And Are Moving Into The Mall; Outdoor Shops Trading Storefronts For Mall Across Street by Glen Richardson
Seemingly in a downward spiral following the addition of paid parking, the Cherry Creek Shopping Center is making a comeback.
As the New Year was getting underway General Manager Nick LeMasters disclosed that, “every single space in the mall is either occupied, under negotiation or under construction.” Unfazed by e-commerce and aided by developers and contractors choking retailers out of Cherry Creek North, LeMasters now says, “We are effectively full.”
As business stages a comeback, the shopping center is making capital investments to keep the momentum on an upward curve. For starters, the mall is installing solar panels on the roof along its western side. LeMasters says the project is nearly complete and will likely be turned on next month (March). “Because of the predominance of the sun in Denver — 300 days of sunshine — we’re going to be effectively powering half of the common-area energy supply with these solar panels,” he says. “It will reduce our overhead significantly, and it’s the right thing to do,” he points out.
Style Boost: Jewelry chain Alex and Ani has moved into the mall from 2827 E. 3rd Ave. The store is known for its handcrafted expandable bangles, chain necklaces and rings.
Mall Master: Longtime GM Nick LeMasters leads a comeback at the Cherry Creek Shopping Center.
Jumping Into Mall
Biggest news as 2019 got underway is that French luxury brand Hermes will begin construction of a 5,000-sq.-ft. space within the mall early this year. Expected to open in 2020, the mall store will replace the company’s standalone site across the street at 105 Fillmore St.
The upscale retailer will be placed next to similar shops, such as Louis Vuitton, Tiffany & Co. and Tory Burch, according to LeMasters. “Hermes is the personification of luxury, and luxury retailers want to be next to other luxury retailers,” he notes. “To be next to other luxury retailers, there’s spin-off business. They tend to complement each other more than compete with each other.”
Opening in late November, North Face also moved into the mall from its former Cherry Creek North location at 100 Detroit St. The retailer now has 5,000-sq. ft. in the lower level of the mall, near Nordstrom. The space used to be part of the jewelry company Tiffany and Co. that relocated within the mall. The move followed the announcement that the North Face’s central office is moving to Denver from San Francisco as part of parent company VF Corp.’s headquarters relocation.
More Making Leap
Hermes and North Face aren’t the only Cherry Creek North retailers who have recently moved into the shopping center. Jewelry maker Alex and Ani made the jump to the mall from 2827 E. 3rd Ave. Earlier this year women’s apparel store White House Black Market relocated to the mall from Cherry Creek North’s Clayton Lane. Also, Lucy Activewear closed its store on Clayton Lane and was folded into North Face now located in the mall. Plus A Pea in the Pod moved across 1st Ave. into the mall.
Luring Luxury: The world’s largest apparel retailer Zara opened in the shopping center at year-end. The European outfitter has taken up 38,000-sq.-ft., making it the largest non-department store in the mall.
New additions to the Cherry Creek Shopping Center at year’s end included San Francisco- based candy shop Lolli and Pops, as well as several businesses that started as Internet retailers. Companies that started in the mall as popup operations and now have their own stores there include mattress maker Casper and stationary bike company Peloton.
Two major retailers — Macy’s Furniture Gallery and The Container Store — relocated within the shopping center, moving from the west to the east side of the mall. Macy’s Furniture Gallery is now adjacent to Macy’s Department Store. The re-imagined Container Store features an open layout plus a Custom Closet Design Center. The two stores built out in the space previously housing Rite Aid and Safeway.
Luring New Brands
The Shopping Center has recently lured several new brands. The Casper store allows customers to schedule a 30-minute “sleep trial” on a Casper mattress in one of the company’s makeshift bedrooms. Peloton opened a showroom at the mall in 2017 where potential buyers can demo the company’s stationary bikes. And Amazon has a pop-up store at the shopping center, where consumers can play around with its Fire tablets and Alexa smart-home devices.
Untuckit — a men’s apparel brand that sells shirts designed to wear untucked — is also opening a store in the shopping center, reveals LeMasters. “They’re going to start construction relatively soon,” he adds. “I think we’re going to see them in the first quarter of 2019.” Launched in 2011, its shirts are shorter than the typical men’s dress shirt. After four years as an entirely online retailer, the brand’s first brick-and-mortar store opened in 2015 in New York’s SoHo district.
Crowds Come Back: Shoppers are returning to the Cherry Creek Shopping Center as new retailers are filling once empty spaces. The mall’s free hour parking beats construction hampered metered parking or $4-5 per hour in Cherry Creek North garages.
“It’s interesting to see this trend that’s emerging with these native online brands that are recognizing the importance of brick-and-mortars,” LeMasters observes. “These brands were thought to be a threat to brick-and-mortar retail, but they’re clearly going to have the opposite effect.”
Stores, Theatre Updating
To encourage tenants to update their looks, LeMasters says the shopping center now offers leases shorter than the 10-year industry standard and builds “midterm remodel” language into its leases.
Eastside Rebuild: Macy’s Furniture Gallery and The Container Store have relocated to the mall’s east side. The two stores built out in previous Rite Aid and Safeway spaces.
“We’ve found that a lot of retailers want to renovate,” LeMasters said. “They’re rolling out stores all the time and as they do so, they evolve their concept and their presentation.” Pandora is an example of a store in the midst of a midterm remodel.
More: AMC Theatres — an original tenant of the mall — is upgrading its look in 2019, which LeMasters called overdue. “Today’s moviegoer expects an upscale experience,” he says. “Our customers love the convenience of this particular theater, but it hasn’t kept pace with others in the market. It will have a completely new and upscale feel to it.”
Space Shuffle, New Stores
Stores are also getting moved around in the mall in the hopes of boosting sales. For example, LensCrafters soon will move to a different storefront in the mall, and a new retailer — which LeMasters declined to disclose — will take its place.
Casper Caper: Mattress online brand Casper has opened a brick and mortar store in the mall. Customers can schedule a “sleep trial” in one of the store’s “bedrooms.”
The year-end addition of Zara, a popular European outfitter, also required rearranging, so Brooks Brothers and Express both moved into different mall locations. Zara has taken up 38,000-sq. ft., making it the largest non-department store in the mall.
LeMasters says the mall will continue to look for emerging retail categories to bring in, such as e-commerce brands adding brick-and-mortar stores and not just selling online. Casper, Peloton and Amazon are examples of such businesses now in the Cherry Creek Shopping Center.
Making Mall Leap: The standalone Hermes store at 1st and Fillmore in Cherry Creek North will begin construction of a 5,000-sq.-ft. space in the Shopping Center early this year. The French luxury brand expects to open the mall store in 2020 to replace the site across the street.
Rug Merchants Latest Gambit Against Glendale Fails by Glen Richardson
The owners of Authentic Persian & Oriental Rugs on Colorado Boulevard (Mohammad Ali Kheirkhahi and his relatives through M.A.K. Investment Group LLC) suffered their latest defeat in their war against the City of Glendale, its residents and officials, in Denver District Court. M.A.K. wants to build a massive high-rise at the corner of Colorado Boulevard and East Virginia dubbed the “Iranian Death Star” by residents. Glendale residents have opposed it and the City Council has indicated that it will not scrap its Master Plan and Zoning Code to allow it.
Legal Victory: Judge Edward D. Bronfin issued a permanent injunction against the IEC claim of jurisdiction over Mayor Mike Dunafon and the City of Glendale.
In order to force the City and its residents to bend to its will, M.A.K. had brought a half dozen lawsuits in federal and state courts orchestrated by Russell Kemp of the Denver law firm of Ireland, Stapleton, Pryor & Pascoe, which have cost the rug merchants and the city millions of dollars in legal fees. The rug merchants hired a top public relations firm and held marches and protests with threats issued against the Mayor and City Council of Glendale. They also, it is alleged, got the FBI to unsuccessfully attempt to bribe various City officials. An undercover FBI agent, Charles Johnson, was arrested in Glendale after harassing Glendale officials and citizens who had spoken out against the M.A.K. project.
All of the lawsuits have been dismissed and the public relations efforts ended badly. But the latest gambit by the rug merchants was to file a myriad ethics charges against Glendale Mayor Mike Dunafon and other officials. The charges were dismissed as frivolous in hearings in the City of Glendale, but another attorney at the Ireland Stapleton law firm, Bernie Buescher, had a novel concept of filing them with the state Independent Ethics Commission (IEC) to which he had close ties.
Collusion: It has long been suspected by some that Glendale rug merchants were possibly in cahoots with the local FBI to force the City of Glendale to allow the building of a massive apartment complex on Colorado Boulevard and East Virginia. Such suspicions would appear to be supported by the above picture taken on October 6, 2015 at Panera Bread on Colorado Boulevard north of Yale and just recently provided to the Chronicle . At the back of the booth, left to right, are FBI Special Agent Kimberly Milka, and FBI Special Agent Jonathan Grusing; at the front of the booth, left to right, are the owners of Authentic Persian & Oriental Rugs, Nasrin Kholghy, Mohammad Ali Kheirkhahi, and Saeed Kholghy.
The hearings on the M.A.K. claims before the IEC have taken years to adjudicate. When the IEC finally declared it had jurisdiction over the matters, suit was brought in Denver District Court before Judge Edward D. Bronfin asking that a Temporary Restraining Order (TRO) be issued preventing the IEC from proceeding.
Judge Bronfin took the unusual step of skipping the TRO process and went directly to issuing a permanent injunction against the IEC declaring: “any decision made by the IEC [regarding Mayor Dunafon] is deemed null and void and is vacated. Any and all pending and further IEC investigations as about the the complaints against Mayor Dunafon are permanently enjoined.”
The ruling was closely watched and celebrated by various municipalities throughout Colorado. The IEC is viewed by many as an out of control entity which is attempting to expand its power in all directions. Much of the criticism is directed at Matt Smith who lives in Grand Junction, and William Leone who resides in New York City, who periodically shift off the IEC chairman role. Smith and Leone have asserted that the IEC is not subject to term limits or most of the state ethical rules. Smith has been on the IEC since its inception in 2007 and Leone since 2013. The two dominate the proceedings and try to cajole or, if necessary, bully the three other commissioners resulting in regular turnover at the other three spots.
Glendale Mayor Mike Dunafon
Smith and Leone also have regularly claimed that IEC is not subject to the Colorado Open Records Act which is being challenged in a separate lawsuit before Judge Bronfin. Most of the IEC work is held in executive sessions away from the public. If the recordings of those sessions are made public some believe they will be highly embarrassing to Smith and Leone, or worse.
Matt Smith
The exact question before Judge Bronfin was could IEC assert jurisdiction over ethics complaints involving home rule cities that had their own ethical standards of conduct like Glendale, Denver, Colorado Springs, and many other Colorado cities. Amendment 41 to the State Constitution, which brought the IEC into existence, expressly states that Amendment 41 does “not apply to home municipalities that have adopted charters and codes” relating to ethics. Smith and Leone have long claimed that the expressed plain language should not apply if the IEC does not believe that any charter or code is not the same or more stringent in virtually all aspects to Amendment 41. Judge Bronfin ruled the language in the Amendment was “clear” and moreover the intent of the drafters was the same and the IEC did not have jurisdiction.
Embarrassed by the ruling Smith and Leone convinced one more commissioner in a 3 to 2 vote to appeal the court ruling up to the Colorado Court of Appeals. In the Colorado legislature Leone has alienated many state legislators by personally yelling and screaming at them concerning past legislative attempts to rein in the IEC. It is expected that new legislative attempts will be made this year at the State Capitol especially since the new governor, Jared Polis, was the progenitor of Amendment 41 and may believe that Smith and Leone have not conducted themselves in an ethical manner or in a manner intended by the language of Amendment 41.
