The developer of a planned outlet center in Eagan has finalized the purchase of land for the $100 million complex, which will include more than 100 shops when it opens late next year.
Baltimore-based Paragon Outlet Partners paid $5.8 million for 29 acres of city-owned land associated with the project, part of an overall $14.7 million deal with Eagan that includes the relocation of streets and utility lines, as well as a contribution toward a parking garage near the mall, said Jon Hohenstein, Eagan’s director of community development.
Paragon plans to construct a six-building, open-air retail complex spanning more than 400,000 square feet at the southeast quadrant of Hwy. 77 and Hwy. 13, part of the city’s redevelopment of the Cedar Grove area, according to Brian Pankratz, a broker with CBRE Minneapolis Land Services Group, which represented the developer in the deal.
Paragon has confirmed that a 28,000-square-foot Saks Fifth Avenue Off 5th department store would anchor the complex. This week, Mid-America Real Estate Minnesota said that a Gap Outlet would lease 11,500 square feet in the center and that a Banana Republic Factory store signed a lease for 7,500 square feet there, as well.
“It’s interesting that Gap and Banana Republic signed on because they’re also at the [nearby] Mall of America, but obviously they’re looking to capture a different customer with the outlet stores,” said Jim McComb, a retail consultant with Minneapolis-based McComb Group Ltd. “Retail store brands have taken to opening outlet stores to increase their sales volume.”
McComb said the days when outlet malls were in out-of-the-way locations are long gone.
“Department stores in metro markets used to protect their turf, but now outlet malls with major brands are moving into metro areas,” he said.
(Other outlet malls in Minnesota are in Medford, Albertville and North Branch.)
As the department store sector has declined in the past decade, other types of retailers have horned in on their turf.
Paragon, whose executives hail from outlet operator Prime Retail, is developing two other properties, in addition to Eagan — in the Bronx borough of New York and in Orlando, Fla.
In 2009, mall giant Simon Property Group, the owner of Southdale Center, Maplewood Mall and the Albertville outlet mall, bought Prime Retail’s portfolio for $2.3 billion.
In marketing materials, the firm boasts of Eagan’s rich demographics and strategic location, noting that the new mall “will be outlet shopping at its finest and attract customers who have a passion for savings on designer and brand-name fashion. A beautiful state-of-the-art racetrack design will feature global brands offering great value.”
The materials don’t specifically note that the nation’s biggest shopping mall — Bloomington’s Mall of America — is fewer than 10 miles away.
The firm has partnerships with Barneys New York, Brooks Brothers, Columbia Sportswear, Calvin Klein, Coach, Cole Haan, Dooney & Bourke, J.Crew, Michael Kors and other retailers.