BOSTON — Affluent, stay-at-home moms drop by Grettaluxe in Wellesley, Mass., each day. Part shopping trip and part social call, they admire Chloé jackets, wiggle into Jimmy Choo sandals and pet the store manager Katie Fessler’s pug, Beverly.
The success of Grettaluxe, which pulls in about $2 million in sales annually, is symbolic of resurgent commerce in many town centers in metropolitan Boston and beyond, as boutiques proliferate to serve women who find malls a snore and city shopping inconvenient. The store has helped pave the way for Wellesley, where the average annual income tops $113,000, to become such a hot spot that commercial landlords have waiting lists. Locals have dubbed the town “Newbury Street West” after Boston’s most fashionable retailing boulevard.
“I can’t tell you how many leases I’ve signed for lotions and potions stores, shoe stores and little denim boutiques,” said Annette Born, principal with retail consultant Urban/Born Associates, who has made a specialty of placing retailers into street spaces in town centers. “Retailers who thought they wanted to be on Newbury Street are taking a second look at some of these town centers.”
And some national players are doing the same thing. Despite their growing cachet, town centers are sometimes difficult for national retailers to penetrate because storefronts are built on a smaller scale than those in malls and many are subdivided, which makes it hard for big firms to get enough space to fit their prototypes.
Still, Eileen Fisher, which caters to moneyed Baby Boomers, is opening in Wellesley. Both Fisher and competitor Sigrid Olsen, owned by Liz Claiborne Inc. and seeking to have 100 stores by 2007, have made traditional town centers part of their retail growth strategy.
“The trend of more boutique shopping is very important,” said Gordon Thompson, creative director of accessories, outerwear and footwear brand Cole Haan, which plans to open 40 to 50 stores during the next two years. “It’s happening everywhere…across the country.”
Thompson said he “wouldn’t rule out” retail locations in town centers. “It doesn’t have to be a huge store, but it can be an important store,” he said. “Retail is dramatically changing. Streets that were the cool streets for independents are becoming savvy about marketing themselves to [national retail] brands.”
Related Articles
You May Also Like
If Cole Haan experiments with and prospers in town centers, it might mean other Nike-owned brands such as Converse and surf lifestyle label Hurley venture there, too. Nike considers Cole Haan a case study in learning more about retailing, Thompson said.
As national players begin to examine suburban Boston, independent merchants are creating mini chains by colonizing wealthy towns such as Andover, Cohasset, Concord, Hamilton, Hingham, Marblehead, Newburyport, Newton, Sudbury, Winchester and Wellesley. All of them fall within the Interstate 95 or Interstate 495 corridors, major north-south thoroughfares that create half-moons around Boston.
Several Boston-area boutiques also have opened in Providence; Portland, Maine; Portsmouth, N.H., and Connecticut towns such as Farmington, South Windsor and New Canaan. Among the most successful is Jasmine Sola, which is known for colorful windows and caters primarily to twentysomething women. The retailer’s success in Cambridge and Newton and expansion to other metropolitan Boston towns attracted several suitors, and the company was bought for $22.5 million last July by the $1.1 billion New York & Co.
Jasmine co-founders Luciano and Stacey Manganella also got stock options linked to overseeing a successful national expansion, according to Securities and Exchange Commission filings. They opened a store in Miami’s Aventura Mall in February. The Manganellas’ progress with Jasmine Sola is being watched by enterprising local boutique owners, who consider the couple role models.
“We fight the nationals, but we all want to be one,” said Gilda Tunney, owner of French Lessons, an upscale lingerie and sportswear boutique in Concord, Newburyport and Hamilton, Mass. She plans to open in another town center this year, and one more next year. The competition has become intense enough that she declined to specify her next location or towns she is considering.
Developers also are eyeing the activity with new interest.
Stephen Karp, chairman and chief executive officer of New England Development Co., who developed enclosed malls earlier in his career, has shifted his focus to select town center projects and to lifestyle centers that mimic them.
Karp spent about $38 million last year buying a majority stake in 20 properties in Newburyport, a waterfront village near the New Hampshire border, 40 miles north of Boston. He envisions turning it into the next Nantucket, where he is also a major property owner.
Windover Development, a residential builder based in Manchester, Mass., has begun buying property in North Shore town centers because of empty nesters growing restless in suburban houses.
“We are seeing a trend of people who want to come to town center environments, where they have their shopping and restaurants nearby,” said Windover principal Lee Dellicker. “We’re getting a lot of reads that this is what people want.”
The company is spending $15 million on Beverly Depot, mixed-use retail and housing adjacent to the Beverly, Mass., train station, 23 miles north of Boston. Another $5 million is earmarked for renovation of a crumbling tavern and surrounding buildings for retail and residential units on Main Street in Rowley, Mass., about 30 miles north of Boston. Negotiations also are under way to buy a pair of Main Street addresses in the fishing village of Gloucester, Mass. Dellicker envisions the Main Street projects as being populated by “active adults,” small restaurants and independent retailers, several of whom already have called to inquire about space, he said.
Federal Realty, a Rockville, Md.-based developer with a 17.6 million-square-foot portfolio, opened a Boston office in March 2005 specifically to acquire properties in the city’s “first-ring suburbs,” generally defined as within I-495, said Don Briggs, vice president of development. The company purchased real estate in Assembly Square in Somerville, Mass., about five miles north of downtown Boston, with plans for a mixed-use development of office, residential and retailing.
The national development scene is beginning to look at 19th-century downtowns for ideas on how to mix retail, residential and office spaces to create dynamic, self-sustaining communities, Briggs said, adding that many new housing developments nationwide are created with a “Main Street” zone. In hopes of attracting home buyers, developers strike deals to bring in a grocery store, boutiques and restaurants.
“It’s creating streets and neighborhoods where we can walk, shop, live and work,” Briggs said. “It was how Boston was developed for 200 years, and it’s only been in the last 40 to 50 years that we’ve gotten away from it with malls, power centers and lifestyle malls.”
Main Street “has got something special,” said Jasmine Sola’s Stacey Manganella. “It’s not a gigantic store awash in a sea of merchandise. It’s not going to a mall and being in Anywhere, USA.”
Two Boston-area retail players have made a nonmall Main Street positioning central to their marketing and concept.
Crossing Main, a contemporary preppy boutique, and Beauty and Main, a cosmetics and skin care enterprise, feature photographs of community women, rather than professional model shots, in each of their seven stores.
While the fashion-comes-to-Main Street phenomenon is not exclusive to the Boston region, several factors make it particularly prominent. Many church-steeple downtowns, built around town greens, have remained intact. They are often surrounded by meandering roads descended from paths that date to the horse-and-buggy era and don’t lead conveniently to the city.
As a result, town centers have become what real estate consultant Born described as “terrariums” nurturing independent retailers. These boutiques, which charge higher prices and give fewer discounts than most national apparel chains, are patronized by an affluent population for whom convenience, service and sensibility trumps price.
And there is plenty of money in Boston’s suburbs. The metropolitan area has the highest concentration of millionaires in the U.S. — about one in 20 households, according to industry research analyzed by Chicago-based investment bank Northern Trust, which recently opened an office in Boston. That number is expected to grow 50 percent in the next five years, the data shows.
Wellesley, Hingham and Andover — positioned 12, 15 and 25 miles west, south and north, respectively, of Boston — are the “Holy Trinity” of town centers because of their affluence and vibrant shops, Born said.
Wellesley’s rents top out at $65 a square foot, while Hingham’s hover around $50 and Andover commands $35. Their rents make them comparable with the $40 to $60 a square foot on the blocks of Boston’s Newbury Street, near Massachusetts Avenue.
Perhaps the most sought-after is Wellesley, a dynamic mix of chains and independents.
Liam Hurley, director of business development for Haynes Management, one of the largest commercial property owners in Wellesley, has no vacancies. When Talbots left storage space it no longer needed, Hurley found a willing retail tenant even though the basement space is windowless.
Wellesley, which has a population of 26,000 and is the home of the elite Wellesley College, also is redeveloping Linden Square, a strip mall formerly anchored by a Roche Bros. grocery store, to make way for more retailers. The larger Linden Square will add more than $200,000 in tax revenues annually to town coffers, said municipal planner Meghan Conlon.
Yet some boutique owners in Wellesley have been disappointed.
“People that are coming in are much older than we expected,” said Amy Gubellini, co-owner of Hazel & Grace, which carries Rozae Nichols and other fashion-insider favorites.
The average shopper is 40 to 60 years old and is not buying the slim-fitting, hip-slung Antik and Taverniti So jeans Gubellini and partner Jennifer Ginn stocked. “We ended up bringing in a higher-rise denim line, Christopher Blue, which we are not crazy about, but which is selling,” Gubellini said. “Our dilemma is how to buy for [the future]. We don’t want to become a store we didn’t set out to be.”
Cindy Stead, buyer for Betsys, a seven-store chain based in Marblehead, Mass., said she is concerned about the frenzy over town centers.
“It’s getting very competitive,” she said. “I think some areas are even over-retailed.” Ambitious merchants are out driving around looking for “undiscovered” town centers, she said, where there might be a good restaurant or two, perhaps a book or toy store, but no fashion.
Yet many independents talk more about cooperation than competition. The end game is keeping customers in town and away from the mall.
“We all kind of act like miniconcierges, recommending each other if we don’t have what a customer is looking for,” said Amy Finegold, owner of Dresscode in Andover, Mass., who worked at Jasmine Sola and Louis Boston. “I would much rather do that than send a customer to the mall.”
In order to compete with the big chains at holiday, Grettaluxe hosted a men-only night in November, during which husbands were plied with beer and pizza while they selected gifts for wives, said manager Fessler.
Savvy boutique owners also capitalize on shoppers’ desires to keep their dollars circulating within the community, nourishing school systems and public works through tax revenue.
“We are also seeing a political statement in people wanting to shop locally, where they know where their money is going,” said Betsys’ Stead. Her Winchester, Mass., store regularly has customers leaning out the car window to do what she jokes is “drive-by” shopping.
“They’ll holler in, ‘I’ll be back,’ as they are dropping a carload of kids somewhere,” she said, adding that the sales staff will ready a few outfits in the dressing room.
People “want a sense of place, they want to connect to a vibrant downtown where they can get a cup of coffee and a newspaper,” said Ann Lagasse, principal in Piper Properties, the dominant landlord in Newburyport and now a partner of developer Karp. “They want someplace where they feel comfortable letting their teenager hang out.”
Newburyport’s thriving independent retail scene has been studied by city planners in Plymouth, Salem, Hyannis and other Massachusetts towns hoping to duplicate their success, Lagasse said.
She said cultivating a dynamic scene has meant legwork and taking chances on mom-and-pop operators.
“We’d look at our retail mix and, if we didn’t have what we needed, like a good shoe store or something, we’d go find them,” she said. “It’s challenging when you’re not dealing with Starbucks, who you know will pay the rent. We’re not always 100 percent successful.”
French Lessons owner Tunney is one example of an independent that made good in Newburyport.
A self-financed operation like many independents, Tunney parlayed revenues generated in Newburyport into openings in Concord and Hamilton, Mass.
She chose towns with expensive housing, but no fashion boutiques or national chains, and ate lots of lunches in her car checking out how women running errands were dressed.
French Lessons has done for Concord what Grettaluxe did for Wellesley. Once jokingly called Ye Olde Concord for its Revolutionary War sites and frumpy Yankee sensibility, the town has seen four well-edited fashion independents open within 18 months of French Lessons, carrying $200 denim and $500 cocktail frocks.
Some communities actively resist bigger stores through size ordinances. Wellesley requires special approval for stores of more than 50,000 square feet. Andover blocked a Gap a few years ago.
Yet these towns are generating enough business so that developers are becoming creative about getting in.
Seeing overflowing demand in the Hingham town center, which houses a Crossing Main, among other shops, Chestnut Hill, Mass.-based developer S.R. Weiner plunked Derby Street Shoppes about three miles away. The development mimics a streetscape with drive-up parking, sidewalks and separate facades for each retailer. The Crate & Barrel, for instance, has an industrial, loft-like exterior, while the Whole Foods is a yellow clapboard affair with a quasi-Martha’s Vineyard flavor.
Kelly Gifford, a working mother from Cohasset, a neighboring town of waterfront mansions, said she was “thrilled” when she found out Derby Street was opening. “This meant I would never have to go to the mall again,” she said. “You get your staples, like Ann Taylor and Banana Republic, but then you have wonderful little boutiques where you can get something really special and different.”