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Published: Tuesday, 8/28/2007

Anchor's departure raises questions for Southwyck

BY GARY T. PAKULSKI
BLADE BUSINESS WRITER
The department store is to leave in for the new Shops at Fallen Timbers in Maumee. The department store is to leave in for the new Shops at Fallen Timbers in Maumee.
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Decorated Christmas trees beckon from inside the Christmas Craft Village at Southwyck Shopping Center, and a sign taped to the window promises it will open in less than two months.

But shoppers interviewed at the ailing Toledo mall yesterday questioned how long the mammoth retail center in southwest corner of the city can survive.

An 80-year-old retiree chuckled about the promised October opening. "It's not going to be here," he said of the mall.

Speculation about Southwyck surfaced anew yesterday after Dillard's, the only remaining anchor at the nearly empty center, informed its employees over the weekend that it will decamp in October for a new shopping center five miles away in Maumee.

Four of Southwyck's 16 other remaining tenants also will have stores at the Shops at Fallen Timbers when it opens Oct. 3, according to the development's Web site. But it is unclear if they will close their Southwyck stores.

The suburban Maumee "lifestyle center" will be operated by mall giant General Growth Properties Inc., of Chicago.

A spokesman for Dillard's Inc., in Little Rock, Ark., said the Southwyck stores will close in mid to late October. The store has 150 employees. Many will be offered jobs at the new store or at the chain's Westfield Franklin Park location. But the spokesman was unable to say how many.

The spokesman, Julie Bull, otherwise declined to comment on the situation.

Retail expert Joseph Belinske, of Toledo's Michael Realty Co., agreed that the Dillard's closing will raise new questions about the mall's survival.

"It's definitely going to hurt foot traffic for the rest of the tenants," he said. "I don't know how they're going to survive."

Glen Anderson, mall manager, declined to comment on whether the center on South Reynolds Road at Glendale Avenue will remain open.

Local developer Larry Dillin is working with a suburban Kansas City family that co-owns the mall with Dillard's to redevelop the property into a $125 million outdoor shopping center in a village-like setting. A third party owns one of the stores in the center.

But those plans have been stalled in a dispute with Dillard's. Real estate industry sources say the key issue involves a disagreement about the value of Dillard's 50 percent stake in Southwyck.

Mr. Dillin said that he has submitted a bid that is higher than an appraisal commissioned by the city of Toledo. He declined to otherwise discuss his bid or Dillard's position on the matter.

Mr. Dillin said he hopes negotiations will accelerate now that the department-store chain will no longer have a presence in Southwyck.

But Dillard's officials have proven to be tough negotiators. Redevelopment of Toledo's Westgate Village Shopping Center was delayed for nearly four years because of the price the retail chain was demanding for a former store there, commercial real-estate experts said.

Mayor Carty Finkbeiner has discussed having the city take possession of Southwyck through eminent domain.

A plan presented yesterday to Toledo City Council could provide the legal basis.

The administration has proposed building a road through the center of the shopping center to connect Cheyenne and Brownstone boulevards, at a cost of $1.9 million.

Todd Davies, commissioner of economic development, said the mall's decline is taking the surrounding Southwyck-Reynolds Road area into a blighted condition.

But city officials would have to obtain court approval for taking over Southwyck.

Mr. Dillin is not surprised by the Dillard's closing.

Despite talk this year that the chain might stay in Southwyck for four more years, the developer said executives told him late last year that the Toledo market wasn't large enough to support three Dillard's stores.

Steve Serchuk, a retail specialist in the Toledo office of Signature Associates, predicted that the closing will speed redevelopment of the mall. "This is good for Southwyck," he said.

Still, the fate of remaining retailers there is unclear.

"I'm just hanging in here and waiting to see what's going to happen," said Alan Prior, an airbrush artist with a store in Southwyck. Traffic is so slow some days that he has no customers.

The manager of a Deb Shops outlet said the women's clothing store is a "destination" spot that continues to do well. "They had to kick us out of North Towne [Square mall]," Crystal Lutz said. "We will stay until the mall is closed."

Melissa Gormley, who was shopping yesterday, said that day appears to be at hand. With the impending departure of Dillard's, there is little to draw shoppers.

"It's the last big-ticket thing people came here for," she said.

Blade staff writer Tom Troy contributed to this report.

Contact Gary Pakulski at:

gpakulski@theblade.com

or 419-724-6082.



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