Pop-ups are cropping up for the holidays

  • Article by: JACKIE CROSBY , Star Tribune
  • Updated: December 18, 2010 - 10:10 PM

The recession has given rise to more temporary stores, which give retailers flexibility to try new things and hungry landlords a tenant.

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At Ragstock’s Christmas store, U of M students Lauren Schnack and Sara Swanson shopped – successfully – for Christmas apparel for Schnack’s theme party.

Photo: Richard Tsong-Taatarii, Star Tribune

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The Museum of Russian Art has been on the lookout for another retail outpost for its popular gift shop for some time. The Mall of America in Bloomington was high on the list because of its tourist draw, but the small nonprofit balked over signing a 10-year lease.

So when a temporary space next to Nordstrom suddenly became available for the holidays, the Minneapolis museum pounced.

"It was a last-minute thing, and we said, 'Let's go!'" said Melanie Brooks, buyer and director of the Izba gift store. "We're tickled to be here. This is our first foray outside the museum, so we really have to weigh it carefully."

With the recession clearing out mall space and retailers wary of taking risks, temporary stores have been a boon to merchants and landlords alike. Landlords get short-term tenants, and merchants can try out new concepts.

Old chestnuts such as Hickory Farms, calendar stores and ornament shops still come around each year. But high-end concepts such as Izba show that the humble pop-up store has come along way.

"Pop-ups are a great strategy for holidays," said Tina Wilcox, CEO of the Minneapolis retail brand agency Black. "Especially when retailers can pop up inexpensively in locations where they don't have a presence, and they know there's a robust consumer there. All they have to do it put up a few racks and turn the lights on."

Independent toy store Hub Hobby, with stores in Richfield and Little Canada, branched outside the metro area this year to open a temporary store in Hutchinson.

Even the American Red Cross has gotten into the act, opening seasonal stores at malls in Minnetonka, Las Vegas and Phoenix where gift buyers can make donations for disaster relief.

National retailers have fanned out like never before.

Toys 'R' Us opened 90 pop-up stores last Christmas. This year, it rocketed its "Express" stores into 600 locations, in part to leverage its acquisition of FAO Schwarz.

Borders, which has taken a back seat to Amazon and Barnes & Noble in e-reader sales, opened 25 temporary stores after testing out five last year.

Twin Cities mall managers say temporary stores have helped boost occupancy. At Burnsville Center, temporary stores now make up 18 to 20 percent of leased space, said general manager Robbin Hahn. Most are year-round stores with short leases.

Mall of America spokeswoman Erica Dao said about 22 percent of retailers have temporary stores, carts or kiosks. That's more than in previous years, "because entrepreneurs are becoming more confident and seeing that people are indeed shopping again," she said.

Ragstock took over space occupied by a church and put in a holiday store piled with Christmas sweaters, lamé tights and winter garb, originally priced from about $5 to $50.

"It's hard to find men's ugly sweaters," said Melinda Eggleston, as she plowed through the Ragstock holiday racks recently with colleague Jeffrey Larson. "We started at the store upstairs and came here for more variety."

Eggleston was suiting up for an annual family Christmas gathering at a barn in Evansville, Wis.

Larson, meanwhile, was planning a 1950s happy hour party in his basement "rumpus room" to celebrate his 50th birthday.

"All the pop-up stores and kiosks at the mall this year have been cool," said Larson, who works with Eggleston at Macy's.

Veteran seasonal store operator Laurie Swiler said times have changed. Her Christmas Corner stores have been operating for nearly two decades and sell personalized ornaments and Made in USA gifts that Swiler buys mostly from Minnesota artisans.

She once had a near-permanent location every year in City Center in downtown Minneapolis. Now, days after shuttering her holiday store, she goes to a buyers' market to order goods for next season filled with uncertainty.

"You're at the bottom of the rung in terms of what you get," she said. "I close my stores around Jan. 8, and go to market on the 13th having no idea what kind of space I'll get next year."

Three weekend snow and ice storms this year have taken a toll on her stores at Gaviidae Commons, Southdale Center and Burnsville Center, as have early discounts from big boxes.

"We don't mark it up to put it on sale, the way they do," she said.

But Swiler said she thrives on the temporary nature of the business, and the satisfaction of giving 16 people jobs for the holidays.

It's likely Swiler will be around to see times change again. The plethora of pop-ups may be a shortlived phenomenon.

"Right now, pop-up stores are cheap. Very cheap," said Sherif Mityas, a partner in the retail practice at A.T. Kearney in Chicago. "As the economy starts to recover and as more sites get taken by longer-term tenants, locations are going to be more difficult to find. That's going to make it harder for retailers to broaden their reach with holiday pop-ups in the future."

For the Russian Art Museum's Izba store, the opportunity may be a foot in the door to something permanent. At least 10 stores at the Mall of America started out as temps, including Goldy's Locker Room and See's Candies. Designer Len Druskin has a history of using pop-up stores to try out concepts that become permanent, notably in Galleria and Southdale.

Izba opened at the Mall of America Oct. 16 and has the space through the end of January. The store also is considering a kiosk, or a store at the Minneapolis-St. Paul International Airport.

"If things go well, we hope we can renegotiate," Brooks said. "It's great way to build awareness about the museum."

Jackie Crosby • 612-673-7335

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