Herberger's likely to fill Southdale anchor hole

  • Article by: JENNIFER BJORHUS , Star Tribune
  • Updated: January 4, 2011 - 5:53 AM

The parties aren't talking, but a marketing brochure lists the "proposed" store for this fall.

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Southdale Mall has been looking for ways to fill the vacant Mervyn's store.

Photo: Glen Stubbe, Star Tribune

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A new Herberger's store may finally plug the empty anchor hole that has dogged Edina's Southdale Center since Mervyn's left years ago.

No one will comment on the deal, but a leasing brochure the mall's owner has circulated says plans to renovate Southdale include a 133,000-square-foot Herberger's, scheduled for this fall. A map shows the department store in the former two-story Mervyn's building, which has been vacant for more than five years.

Filling that anchor spot has been seen as critical to reviving the aging mall. Southdale was a pioneer when it opened in 1956 as the nation's first multilevel indoor mall and served for years as a town center for the well-off suburb. But despite a multimillion-dollar expansion in the early 2000s that added a 16-screen movie theater as well as trendy national restaurants such as Cheesecake Factory and P.F. Chang's, the mall has struggled.

The depressed economy as well as competition from other shopping centers such as the nearby upscale Galleria have taken a toll. Design problems haven't helped. Many of the shop spaces are too deep with narrow fronts -- call it the bowling alley effect -- and there also are issues with old lighting, lower ceilings and outdated common areas, said Dick Grones, a retail veteran and principal at Cambridge Commercial Realty.

Southdale's vacancy rate is nearly 13 percent, compared with 4.5 percent for all regional malls in the Twin Cities, according to Cushman & Wakefield.

The leasing brochure refers to the Herberger's store as "proposed." Southdale's renovation plans also include a new second-level food court near J.C. Penney with indoor and outdoor seating, it said. The mall's current anchors are Macy's and Marshalls.

Southdale is owned by Indianapolis-based Simon Property Group Inc., the nation's No. 1 mall owner, which bought it in 2007 but later delayed redevelopment plans. Simon spokesman Les Morris said the company doesn't announce new tenants until a lease has been fully executed, "and we don't have one yet in this situation."

Executives at Bon-Ton Stores Inc., the York, Pa.-based owner of Herberger's, also wouldn't comment.

Cary Teague, city planner for Edina, welcomed the proposed Herberger's but said Simon has yet to approach the city with plans for the old Mervyn's spot.

"It sounds as if the building is in somewhat tough shape, so they're going to need to do some work in there," Teague said.

Grones described Herberger's as a middle-market retailer with a niche that's a notch below Macy's in terms of target customers, and a notch above Kohl's. He said it will be "a great replacement" for Mervyn's at Southdale, noting there is no Kohl's at the mall.

"I think they're going to enjoy a nice position over there," Grones said.

Herberger's has another store just a few miles south in the Southtown Shopping Center off Interstate 494 and Penn Avenue S. in Bloomington, but Grones said he's not worried about the store cannibalizing its own sales because the highway acts as a bit of a barrier and because Southdale pulls customers mostly from the north.

"This is the first real news out of Southdale for some time," he said.

Jennifer Bjorhus • 612-673-4683

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