Wednesday, September 13, 2017

Two Big Businesses Go Bust in Buckhead

Buckhead's Lenox Marketplace shopping center will lose two of its anchors in the coming months.  Pirch, an award winning, interactive kitchen and bath appliance showroom, which opened in the center in late 2014, will close its 27,243 square foot Buckhead store effective September 30th.  The store, while cool and different, never really caught on in the Atlanta market the way it has in the chain's home territory of southern California.  Store sources indicate that the showroom will cease operations September 30th but that the store will continue to accept and deliver orders from its regional distribution center through November 30.  As of now, there is no word on if/when there will be any sale of the showroom's demo appliances and fixtures. 
The Lenox Marketplace store will be just one of the stores Pirch plans to shutter as it overhauls operations according to Bloomberg, which first reported the news.  The company, known for its in-store chefs, coffee shops and try-before-you-buy ethos, is refocusing its efforts on its four profitable stores on its home turf of southern California.  Private equity firm L Catterton, which was formed in January of 2016,  by "Catterton, the leading consumer-focused private equity firm, LVMH, the world leader in high-quality products, and Groupe Arnault, the family holding company of Bernard Arnault," is the primary backer of the Pirch concept.  

The company has already closed its showroom in Austin, Texas, just a few months after its May opening.  The company has also closed its stores in Paramus, New Jersey and in New York's SoHo neighborhood.  Pirch locations in Dallas and Chicago are currently scheduled to follow a similar timeline as the Atlanta store and are planned to close September 30th.  Last Fall, Pirch claimed its stores averaged an estimated $3,000 in annual sales per square foot, which is hard to believe but still a far cry from Apple's estimated $5,500 sales per square foot.  The company stated, “We remain confident that our unique business model will be successful on a more focused scale, and we are committed to delivering on our founding mission of providing customers exciting new ways to shop for the home through our innovative multibrand immersion experience.
This grand staircase was one of many costly features at the Pirch showroom in Buckhead
Pirch's neighbor, Neiman Marcus Last Call Studio, which also opened in the center in late 2014, will close in January, likely in hopes of selling merchandise at higher prices leading up to the holiday shopping season.  The 14,343 square foot store, which was an extension of the "Last Call" concept, stocked nearly 100% merchandise exclusively produced for outlet sale and not merchandise that might have ever come from a full-line Neiman Marcus department store.  Shoppers were not impressed with the faux outlet concept and its closure comes as little surprise.  The store had only ten reviews on Yelp.com with an overall 2 star rating.  

Neiman Marcus is in the midst of a restructuring that led to layoffs of 225 employees in July, including at least one executive level manager at their Lenox Square store.  The company also said in July that it would be "assessing the future" of its Last Call division.  In addition to the Last Call Studio closure in Atlanta, the company confirmed yesterday that it will close eight other Last Call stores: Philadelphia Premium Outlets, Potomac Mills (Virginia), Arizona Mills, Gurnee Mills (Illinois), Livermore Premium (California), Arundel Mills (Maryland), Philadelphia Mills and Great Lakes Crossing (Michigan) and Horchow Finale in Plano, Texas.  The closures represent about 25% of the company's outlet stores.

The closings will leave Neiman Marcus with 28 Last Call locations including one at Sugarloaf Mills in Lawrenceville.  The company will also continue to operate 42 full-line department stores including their lone Atlanta area store at Lenox Square in Buckhead. In comparison, Nordstrom, seen by many as the "best in class" when it comes to department store outlets, operates more than 220 Rack stores while Saks has more than 120 Off Fifth locations. Bloomingdale's, the upscale division of Macy's, entered the outlet game with Bloomingdale's "The Outlet" in 2010.  The company has since expanded the concept to a total of  18 locations, none thus far in Georgia.  The Last Call closures could present an opportunity for Bloomingdale's to cherry pick locations like Atlanta where they are without a presence. 
Lenox Marketplace has been plagued by issues even before its 1999 opening.  Located near the corner of Roxboro Road and Peachtree Road, across from Phipps Plaza, Lenox Marketplace was developed in 1998/1999 by The Sembler Company for Jamestown.  In 1997, plans for the project included a giant IMAX movie theater and potentially a 30,000 square foot Virgin Megastore.  Despite the IMAX theater being reportedly confirmed and the Virgin store "close," neither ever opened in the project.  

Norcross based Uptons, a department store,  was later announced to be one the center's anchors, joining Publix, Galyan's and Target.  All Uptons closed in 1999 and the Buckhead store as well as stores planned for Mall of Georgia Crossing in Gwinnett County, Arbor Place Mall in Douglasville and Fayette Pavillion in Fayetteville all become dekor, a new home appliances and furnishings store started by former Home Depot employees.  Dekor opened in late 2000 in Buckhead but closed in late 2001 amidst company wide cash flow problems and a Chapter 7 bankruptcy filing.  A Peachtree facing Starbucks Coffee that was essentially an amenity of the dekor store closed when the appliance store closed. 

Subsequent anchors have not fared much better. 

The entire Galyan's Trading Company chain was sold to Dick's Sporting Goods in 2004 and its Buckhead store was promptly rebranded and stripped of its artsy metal bear logo on Peachtree and the three story climbing wall inside the store.   

Columbia, South Carolina based Edens (then Edens & Avant) purchased the approximately 400,000 square foot center from Jamestown for an undisclosed amount in  late 2004. 

American Signature Furniture opened in a portion of the former dekor space in 2005 but was closed by the end of 2008.  Filene's Basement, then a division of Retail Ventures, which also owned American Signature Furniture, additionally opened in a portion of the former dekor space. The store opened in 2003 but closed in early 2012, after the company liquidated following a Chapter 11 bankruptcy filing.   

Urban Active, a fitness facility backed by Under Armour, was sold to LA Fitness in 2012 and continues to operate but under the LA Fitness branding.  

Other closures in the center include  Ali-Oli, a tapas restaurant, Verizon, which relocated to a Selig's Buckhead Square II, Buffalo Wild Wings, which claimed they were moving to south Buckhead in 2014 but never did, and most recently, Staples.  

Furniture retailer Ethan Allen opened in the former Staples this past July, marking the return of the retailer to Buckhead since it closed in the former Sports Authority shopping center nearby over five years ago.  

Are you surprised by the closures at Lenox Marketplace?  What would you like to see open in place of Neiman Marcus Last Call Studio and Pirch at Lenox Marketplace?  What is your favorite off-price/outlet store?

Please share your thoughts below  

11 comments:

SB said...

That center has such incredible turnover. Good job capturing all of it. Didn't they push out the BWW to make room for the now-closing Neiman? That BWW was always packed. Feels like they need more restaurants in there instead of zero. Should have turned the Staples into 2-3 restaurants? Big boxes aren't destinations anymore. Also, that Target is so great to shop in because it's always empty!

Anonymous said...

Sad. Pirch is a beautiful store.

Anonymous said...

It's a poorly designed complex. There is absolutely zero walking traffic between stores, and no street presence. You could shop at Target everyday, and never know any other stores exist.

RichKnobSales said...

I had not heard about Pirch so I never got a chance to check it out.

As for Faux outlets - meh! I remember the days when the outlets were in the factories and really had off kilter stuff at great prices. For the past 30 years it's been a deteriorating mish mash of bad fabrics sewn poorly and other such crap.

Anonymous said...

Great article!! I too think it is a poorly designed shopping center. I used to shop at the Target but have gotten tired of dealing with the parking deck.

I drive by that center everyday and ironically last night was the first time I even noticed the Pirch store.

Anonymous said...

Great summary. I love this blog. Funny, when I was a child in Atlanta I remember a pharmacy on this property with a real soda fountain inside. Think it was called Northside Pharmacy. Agree with the others about the life-threatening parking situation....especially between the Target and Publix on the first floor where there's a blind corner as the sidewalk ends. Walking our kids there is scary. I don't know what kind of tenant would work best there but north Buckhead is missing destinations for FAMILIES. How often we wish there was just a reasonable casual place for spaghetti dinner or a regular ice cream place to give birthday parties but the rent is so high now it will probably never happen. Still....missed opportunity.

Anonymous said...

This was my old stomping grounds - use to hang out at Oz records and tapes. Miss those days.

Greg said...

I suspect LA Fitness is just riding on the lease on the former Urban Active and will close it.

I agree the development is weird, the parking deck is claustrophobic and confusing. I wonder if the Target and Publix do well compared to more traditional locations with surface lots.

396 said...

I've been in Lenox Marketplace a few hundred times in a dozen years and I'd really like to nominate it for some kind of international award for demonstrating 100 percent indifference to pedestrians. Sidewalks that are half as wide as they should be and seem to start and stop at utter random, crosswalks that run right into huge columns, street-facing doors that are locked and blocked, stairs that go nowhere.

I'd assume that they ignored the pedestrian experience in favor of making it easier and better for drivers but it appears that someone designed the parking deck after a night of heavy drinking as well.

I'm sentimentally attached to that Target although I prefer the way it was back in back in Ye Olde Days, before they added the grocery section. It seems unnecessary, with Publix right next door, but walking there from Target requires trying to avoid getting flattened by someone backing out of a parking space or driving too fast around a corner, so I get why people would appreciate being able to buy milk and cereal while they're in Target.

Anonymous said...

I like the interior parking lot, but it could be much improved by better pedestrian markings and signage. The pedestrian frontage on Peachtree also needs help. The curb cut on Peachtree should be eliminated, or made right in only. And ALL stores with steet frontage should have their doors unlocked and open to the public during business hours.

Attempted Pirch Shopper said...

I am not surprised Pirch is closing. I visited the store several times last year, and was determined to renovate my new house's kitchen with their products. Turns out, the reps for most of the products aren't actually in the store. You have to email them and set up an appt. Rep was ridiculously hard to reach, it took me 6 weeks to get a meeting. After that, rep kept emailing me that cabinetry quote was on its way. It never came. Finally I gave up and bought from elsewhere. Thought to myself then, guess this store is really not in the business of actually selling anything.