Sioux City General Business News

[Suxcity]

Gateway sale leads to uncertainty in North Sioux
11:40 AM
By Dave Dreeszen Journal business editor
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Gateway Inc., which has agreed to be acquired by Taiwain-based computer maker Acer Inc., might not be done dealing.

Irvine, Calif.-based Gateway this morning said talks are under way to sell off its professional division to an undisclosed third party. Details of those discussions were not released.

That follows the blockbuster announcement earlier this morning that Acer plans to buy Gateway in a $710 million deal that would create the world's third largest PC company.

Gateway's professional business, focused on education, government and business customers, is based in North Sioux City. Combined, the professional division and the direct division, which focuses on direct sales to consumers over the phone and online, account for the majority of jobs at Gateway's cow-spotted complex, which employs about 850.

In a conference call announcing the deal, Acer said it plans to keep the Gateway brand. Acer officials also said Gateway employees would be critical to its success in expanding the brand to new markets. But it's uncertain how many Gateway employees will be retained, and what, if any, role North Sioux City will play in the new combined operation.

Some of those questions could be answered later today. In an e-mail this morning to employees announcing the sale to Acer, Gateway employees were told that more information could be provided later this afternoon.

"We're cautionsly optimistic until we hear more details," said Kory Menken, executive director of the North Sioux City Economic Development Corp. ''Hopefully it won’t have any negative ramifications."

In a statement, Acer said combining the two companies would create "significant revenue and cost synergies."

Retired Gateway CEO and chairman Ted Waitt and his friend, Mike Hammond, founded then-Gateway 2000 in a farmhouse at the Waitt family farm near Sioux City in 1985. Five years later ,the startup company moved its headquarters across the Big Sioux River to North Sioux City, where nearly 6,000 people worked at its peak in the late 1990s.

The company, which moved its corporate offices to southern California in 1998, over the past decade has struggled with declining sales, senior management upheaval and an ill-fated move to operate its own retail stores.

Shares of Gateway stock, which hit an all-time high of $84 in November 1999, have dropped 99 pecent since then.

To acquire Gateway, Acer will pay $1.90 per share, a 57 percent preimum over Friday's closing price of $1.21. Shares soared nearly 50 percent in the opening minutes of trading on the New York Stock Exchange today.

The $710 million deal, which has been unanimously approved by the boards of directors of both Gateway and Acer, will push the combined firm past China's Lenovo Group as the world's third largest vendor of personal computers.

The deal will create a multi-branded computer company with more than $15 billion in revenues and shipments in excess of 20 million units per year.

"This strategic transaction is an important milestone in Acer's long history," said J.T. Wang, Acer's chairman, in the statement. "This will be an excellent addition to Acer's already strong positions in Europe and Asia."

Ed Coleman, chief executive of Gateway, welcomed the buyout.

"Joining with Acer will enable us to bring even more value to the consumer segments we serve and capitalize on Acer's highly regarded supply chain operations and global reach," he said in the statement.

The Associated Press contributed to this story.

[Better Life dude]

That's not good news at all for the Siouxland. Look for consolidation and job losses. Probably was inevitable the way Gateway has been stumbling around these past few years.

[siouxperland]

That's not good news at all for the Siouxland. Look for consolidation and job losses. Probably was inevitable the way Gateway has been stumbling around these past few years.

On the other hand, most of Acer is based in Taiwan without a large US presence like Gateway, North Sioux could GAIN from this.

[Mastermind]

I was kinda thinking along the same lines, see Aviva in DSM. The difference is Amerus was the HQ whereas the HQ for Gateway is in Cali.

[Better Life dude]

I don't know what the Gateway employees do in North Sioux, but if it's assembling computers, that could be outsourced overseas, especially with their new Asian ownership.

[Suxcity]

I believe North Sioux is alot of sales and customer service.

[Suxcity]

This could also be great for the Gateway name. This could greatly increase revenue internationally. I also kinda wonder if this will effect the naming rights to Tyson Events Center- Gateway Arena.

[Suxcity]

Wholesaler will locate in former stock yards
9:50 AM
By Dave Dreeszen Journal business editor

A national wholesaler of heating, cooling and ventilation equipment and supplies plans to open a location in Sioux City.

Johnstone Supply wants to build a $2 million office, showroom and warehouse at the site of the former Needham Packing plant. The city plans to sell the roughly five acres of bare land at 1401 Cunningham Drive to the company for a dollar. Because the land is in the city's Combined Floyd Valley Urban Renewal Area, the city, by law, must seek other offers for 30 days.

At Monday's meeting, the City Council approved setting a hearing on the land sale after the 30-day period.

The site in the former stock yards is visible to motorists traveling on Interstate 29.

"It's going to be an improvement to the entrance of Sioux City," City Economic Development Director Marty Dougherty told the Downtown Rotary Club earlier Monday.

Dougherty said city staff first contacted the company about a year ago. Johnstone, founded in Portland, Ore., in 1953, is a leading distributor in the HVACR industry, with more than 300 locally owned and operated stores nationwide.

Sioux Falls-based Johnstone Supply will own and operate the new Sioux City outlet. The company hopes to begin construction on the 28,000-square-foot building later this year, with completion set for next spring. The project is expected to create 16 new jobs within three years.

The city plans to loan Johnstone $250,000 to help finance the project. Of that amount, $150,000 will be forgiven if the company creates the new jobs, and the remaining $100,000 will carry a 4 percent interest rate over five years.

As part of the development agreement, Johnstone also is expected to qualify for $235,000 in state enterprise zone tax credits and $92,000 in credits from the state's new Targeted Jobs program.

Johnstone is the latest new or expanding business seeking assistance from the Targeted Jobs, a pilot project state lawmakers approved last year for Sioux City and three other border cities. "Essentially, what it allows us to do is invest in state income tax dollars to invest in projects in Sioux City," Dougherty told the Rotarians.

On Monday the council approved a request to apply for Targeted Jobs tax credits for two more projects -- $233,000 over 10 years for Northwest Airlines' new 330-employee reservation call center in the former JCPenney building; and $49,000 for the 31 new jobs Fed-Ex plans to create at its new ground transportation center near Sioux Gateway Airport.

Since its adoption, Doughety said the Targeted Jobs program has created 266 new jobs, retained another 436 and leveraged $16.2 million in investment.

"This is a good new program that we have," he said. "We think we just scratched the surface in terms of using that tool."

[siouxperland]

If the city/state DOT/Feds could get together and agree on an exit from I-29 into the "Yards" district, it would flourish. I think that access is the main reason it's not doing as well as planned.

[Suxcity]

Asia trip pays off for South Sioux
Japanese manufacturer considers locating in Siouxland
By Dave Dreeszen Journal business editor

Nebraska Gov. Dan Heineman's trade mission to Asia could help bring new jobs and foreign investment to South Sioux City.

While in Japan last Saturday, Heineman met with the CEO of an unidentified high-tech manufacturer that is considering locating in South Sioux City, said Dan McNamara, the city's economic development director.

McNamara and Gene Leman, an economic development consultant for the city, joined Heineman at a dinner with the CEO in Tokyo.

By all accounts, McNamara said the meeting was successful. He said the governor and Japanese business leader seemed to hit it off, chatting about everything from Nebraska's business climate to Cornhusker football for about 2 1/2 hours.

"I don't think it could have gone any better," McNamara said in an interview Tuesday.

McNamara praised Heineman for rearranging his official schedule at the last minute to meet with the CEO. Arranging a meeting with someone of the governor's stature is seen as a sign of great respect in the Japanese culture, he said.

"Dan and I could have gone and not accomplished much," Leman said. "It took the governor to be there for this guy to realize we are really interested and we will do everything we can from the governor on down to make their entry into the area as smooth and painless as possible."

State and local leaders have been courting the Japanese firm for some time, Chris McGowan, executive vice president of the Siouxland Initiative, said Tuesday. The CEO has visited the metro area previously, as have other representatives of his company.

McGowan said negotiations are beyond the preliminary stage, and local leaders are "cautiously optimistic about the potential" of the manufacturer making a major investment in Siouxland.

McNamara and Leman were among the 65 business, education and government leaders invited to accompany Heineman on the Asian trade mission. Other area delegates included Harry Knobbe and Herb Albers, livestock producers from West Point and Wisner, Neb., respectively.

Leman and McNamara left Sept. 2 on an eight-day trip that included stops in Shanghai, China, Hong Kong and Tokyo. They returned home late Monday night, skipping the last leg of the Heineman-led trip to Taiwan.

While in Tokyo, McNamara and Leman also courted the leader of an unidentified manufacturing firm that is interested in opening a beef plant in South Sioux City. To reduce shipping costs, the firm wants to fabricate beef in the U.S., and then send the smaller cuts to Japan, where it operates a number of restaurants and meat markets.

Leman, a retired Tyson Fresh Meats executive, said he talked to the company about the potential for Tyson's Dakota City beef plant to supply the raw materials. Though the Japanese firm is interested in South Sioux City, the deal likely will hinge on whether Japan opens up its market to more U.S. beef imports, he said.

Japan, once the largest buyer of U.S. beef, currently limits imports to meat from animals aged 20 months or younger. The country imposed restrictions following the discovery of the first case of mad cow disease. Some beef industry officials are urging Japan to increase the age limit to 30 months, Leman said, while the U.S. Department of Agriculture wants no restrictions, he said.

The trade mission gave Leman an opportunity to renew old contacts he had developed in China and Japan during his long career with Dakota City-based Tyson Fresh Meats and its predecessor, IBP inc. It was his first trip back to the region in eight years.

"It was a good chance for me to renew my thought process about how the marketplace worked and what kind of products they wanted," he noted. "Bottom line is we accomplished what we set out to do, learned a lot and met a lot new people."

[Suxcity]

Asia trip pays off for South Sioux
Japanese manufacturer considers locating in Siouxland
By Dave Dreeszen Journal business editor

Nebraska Gov. Dan Heineman's trade mission to Asia could help bring new jobs and foreign investment to South Sioux City.

While in Japan last Saturday, Heineman met with the CEO of an unidentified high-tech manufacturer that is considering locating in South Sioux City, said Dan McNamara, the city's economic development director.

McNamara and Gene Leman, an economic development consultant for the city, joined Heineman at a dinner with the CEO in Tokyo.

By all accounts, McNamara said the meeting was successful. He said the governor and Japanese business leader seemed to hit it off, chatting about everything from Nebraska's business climate to Cornhusker football for about 2 1/2 hours.

"I don't think it could have gone any better," McNamara said in an interview Tuesday.

McNamara praised Heineman for rearranging his official schedule at the last minute to meet with the CEO. Arranging a meeting with someone of the governor's stature is seen as a sign of great respect in the Japanese culture, he said.

"Dan and I could have gone and not accomplished much," Leman said. "It took the governor to be there for this guy to realize we are really interested and we will do everything we can from the governor on down to make their entry into the area as smooth and painless as possible."

State and local leaders have been courting the Japanese firm for some time, Chris McGowan, executive vice president of the Siouxland Initiative, said Tuesday. The CEO has visited the metro area previously, as have other representatives of his company.

McGowan said negotiations are beyond the preliminary stage, and local leaders are "cautiously optimistic about the potential" of the manufacturer making a major investment in Siouxland.

McNamara and Leman were among the 65 business, education and government leaders invited to accompany Heineman on the Asian trade mission. Other area delegates included Harry Knobbe and Herb Albers, livestock producers from West Point and Wisner, Neb., respectively.

Leman and McNamara left Sept. 2 on an eight-day trip that included stops in Shanghai, China, Hong Kong and Tokyo. They returned home late Monday night, skipping the last leg of the Heineman-led trip to Taiwan.

While in Tokyo, McNamara and Leman also courted the leader of an unidentified manufacturing firm that is interested in opening a beef plant in South Sioux City. To reduce shipping costs, the firm wants to fabricate beef in the U.S., and then send the smaller cuts to Japan, where it operates a number of restaurants and meat markets.

Leman, a retired Tyson Fresh Meats executive, said he talked to the company about the potential for Tyson's Dakota City beef plant to supply the raw materials. Though the Japanese firm is interested in South Sioux City, the deal likely will hinge on whether Japan opens up its market to more U.S. beef imports, he said.

Japan, once the largest buyer of U.S. beef, currently limits imports to meat from animals aged 20 months or younger. The country imposed restrictions following the discovery of the first case of mad cow disease. Some beef industry officials are urging Japan to increase the age limit to 30 months, Leman said, while the U.S. Department of Agriculture wants no restrictions, he said.

The trade mission gave Leman an opportunity to renew old contacts he had developed in China and Japan during his long career with Dakota City-based Tyson Fresh Meats and its predecessor, IBP inc. It was his first trip back to the region in eight years.

"It was a good chance for me to renew my thought process about how the marketplace worked and what kind of products they wanted," he noted. "Bottom line is we accomplished what we set out to do, learned a lot and met a lot new people."

[siouxperland]

Hard to keep track of everything South Sioux City has going on with industrial development. First the $400M BPI project (which is in full swing, drive by it sometime), the $100M soy protein project plant and now something like this.

From KCAU.com Sioux City:

Nebraska Governor Dave Heineman’s recent trip to Asia could land help land a major tech manufacturer in South Sioux City.

South Sioux City economic developer, Dan McNamara, who also went on the trip, says the meeting with the unnamed business was successful.

McNamara says the business would bring high paying jobs to the community.

“This is something we don't have, this is something you would see in Silicon Valley, and the company has experienced the fact they don't want to be in Silicon Valley because of land costs. They want to get more in the heartland,” said McNamara.

[trailer]

Hard to keep track of everything South Sioux City has going on with industrial development. First the $400M BPI project (which is in full swing, drive by it sometime), the $100M soy protein project plant and now something like this.

From KCAU.com Sioux City:

Nebraska Governor Dave Heineman’s recent trip to Asia could land help land a major tech manufacturer in South Sioux City.

South Sioux City economic developer, Dan McNamara, who also went on the trip, says the meeting with the unnamed business was successful.

McNamara says the business would bring high paying jobs to the community.

“This is something we don't have, this is something you would see in Silicon Valley, and the company has experienced the fact they don't want to be in Silicon Valley because of land costs. They want to get more in the heartland,” said McNamara.

Nice to see that Nebraska reps South Sioux. I wish Iowa could do the same with SUX.

[siouxperland]

Nice to see that Nebraska reps South Sioux. I wish Iowa could do the same with SUX.

The Gov of SD really works hard for Union County too. Behind Minnehaha, he's called Union the 2nd most important county in SD's future.

IF that $8-10B refinery happens, you'll see a boom in that county/SE South Dakota like nothing else in the state.

[econboy]

Actually, word is, through various municipal and economic insiders, the economic effect of the refinery will spread out as far as 200 miles. Not to mention a new pipeline that is to be built from Canada down through Missouri.

[Mastermind]

IDED spends as much time with SC as any other city in Iowa aside from DSM and CR (at least that is how it was with Blouin). The problem with SC is that they focus on Siouxland and not necessarily Sioux City.

[siouxperland]

SC Museum backing up expected opening date...

Museum move downtown pushed back to 2009
By Bret Hayworth SCJournal staff writer

The Sioux City Public Museum won't be moving downtown into the former JCPenney building until 2009.

The project is slowed by an accompanying move into the site by a Northwest Airlines call center, and because the capital campaign to raise money for the anticipated $8 million museum move has yet to begin.

The annual joint meeting of the Sioux City Council and Museum Board of Trustees yielded some new information, including that the move by the Northwest Airlines call center has impacted the timing of the museum's move.

Board member Denny Bullock said there is "frustration" that the museum, now at 2901 Jackson St., is not moving in 2008 as expected, since the board is eager to begin a fundraising campaign for the project. While museum director Steve Hansen said the Northwest move into the same site "has slowed us down," he said that was a minor inconvenience.

"It isn't a big deal in the grand scheme, because we always knew we would need a neighbor," Hansen said.

"We aren't frustrated at all," board president Ed Lord said a bit later.

"You are getting a new museum," city manager Paul Eckert said.

"How bad can that be?" added Bullock, ending the line of conversation.

Eckert said Northwest will take possession of its portion of the Penney building in October and has six months after that to start up the call center.

Councilman Dave Ferris said "everyone recognizes" the importance of the 350 Northwest Airlines call center jobs. Ferris described serving on a confidential committee last year as Northwest spoke with city officials about a possible move, even as he knew it might impact the museum plans that were also moving forward.

Even with Northwest locating on the top floor of the three-story building at 607 Fourth St., there is plenty of space for the museum, Hansen said. The museum will spread out over 55,000 square feet on the main floor and roughly 17,000 feet of the second floor, providing four times the space as the existing museum.

"It will more than meet our current needs and allow us to grow," Hansen said. "You don't have to fill it up all at once."

The larger museum would allow the numerous off-site museum collections at Pearl Street Research Center, 407 Pearl St., to move into the museum.

Surrounded by sacred pipe and flaked stone tool exhibits, the city councilmen and board members met on the third floor of the museum, where Hansen told of some of the exhibits being readied for the move. A second floor exhibit of stuffed wild animals had been at the same site for at least 35 years, he said.

"It gave new meaning to the term 'permanent exhibit,'" Hansen said.

Hansen said things will begin to move ahead within 60 days, when conceptual museum plans are due back from Neumann Monson Wictor of Sioux City and Bahr Vermeer Haecker Architects of Lincoln. Once those are done, the museum should be moved within 18 months, placing the move at mid-2009.

Hansen said the early projection is that the fundraising amount will be $8 million, although he said he didn't want to set that in stone. The city's current Capital Improvements Program is to devote $1.5 million to the project, so the majority of the museum move cost will be paid through fundraising. Hansen said a "quiet phase" of fundraising will soon begin, with the public fundraising likely to launch in 2008.

Board member Ray Krigsten said he's ready to get the museum fundraising under way. Krigsten said he is too frequently reading the obituaries of people he anticipated asking for donations.

The museum being vacated is known as the historic Peirce Mansion. It will be converted back into a period home to be operated by the Sioux City Historical Association, and will have strong appeal for visitors, Hansen said.

JCPenney, the downtown's largest retailer at the time, moved to Southern Hills Mall in 2004. Larry Book, one of the owners of the Penney building, did not immediately return a call Wednesday.

Bret Hayworth may be reached at (712) 293.4203 or brethayworth@siouxcityjournal.com

[DMRyan]

Good to hear the Pierce Mansion will be kept as a restored historic home museum.

[Suxcity]

Next Door Move Puts A "Gap" In Siouxland Mall

A next door move is leaving a "gap" in Sioux City's Southern Hills Mall.

After hearing its plans to open a new outlet store across the street at Lakeport Commons, the Southern Hills Mall has given the "Gap" its 2 week notice to get out.

"Gap" officials says it planned to stay in the mall until early next year, but is being forced to close its doors on Monday.

The "Gap's" new outlet store at Lakeport Commons is expected to be open by sometime in March.

[Ingersoll1978]

Why would SHM do that? Is the GAP currently there an outlet?

[siouxperland]

Why would SHM do that? Is the GAP currently there an outlet?

No, it's a regular Gap/Gap Kids/Gap Baby store. I don't know why Gap would do this, the rent at Lakeport Commons is higher. They lease 10,300sf in SHM right now, I don't know how much or where they'd go in Lakeport Commons, there's no 10,300sf continuous space available. Old Navy is over there and that's part of the Gap family. Maurices left a big chunk empty in SHM when it moved to LC a few months ago. The Gap move will leave about 45,000sf of space total in the mall available. Not real bad for a 800Ksf mall but space not making rent.

Actually, the outlets are combo GAP stores and GAP outlets, you'll find the new stuff and clearance of older stuff at the same time. They also do NOT sell 2nds merchandise, so no mis-stitched clothing, irregulars, etc. It's no secret that the GAP is having money troubles right now. Underperforming Old Navy & Banana Republic stores are also biting the dust. From GAP's site, 80 GAP's will close while 30 will open, a net loss of 50. About 115 Old Navy's will open but 65 will close. BR, 45 opening, 20 closing.

2007 Expected Store Activity (As of August 4, 2007)
Brand/Division Expected Openings Expected Closings Expected Net Openings/(Closures)

Gap North America* about 30 about 80 (about 50)

Old Navy about 115 about 65 about 50

Banana Republic about 45 about 20 about 25

Forth & Towne 0 19 19

Gap Inc. Total about 230 about 200 about 30

[DMRyan]

Now that's the kind of stuff we like seeing on here Siouxperland. Pretty dramatic transformation from the old Iowa downtown of the 1980's to what's going on all over the state currently. Jimmy John's would be nice land for downtown. Your bigger cousins in DSM don't have that yet.

It's amazing what appears under the 1960's and 1970's ugly cladding. Just when you think a building is destined for the trash heap, you get to see that the building has real bones behind the schlocky cladding.

[Mastermind]

this should be a hit with the bar crowd as well!

[tmunson]

I like what has been done to this building, so don't get me wrong when I say this building should not have been rehabilitated.

The building itself only dates back to the late 30s or early 40s and is just a plain concrete block building built to warehouse car parts. What is really interesting though, is that below the exterior walls, there is no foundation. The concrete blocks are just sitting on the dirt a couple of inches below grade. The same was true of the old poured concrete floor. In some places it was several inches think, in some areas the old floor didn't even cover the dirt below.

The building was not meant to stand for more than a couple of decades. In addition, in the rehabilitation, no one addressed the structural shortcomings. I know the architect on this project well, and he does great work, but this redevelopment occured ahead of far-worthier projects.

[siouxperland]

The long white building to the north (or left in the photo) is also owned by the developer and will also eventually be re-habbed. No time table on that but here is a sketch:

[Mastermind]

That's not good news at all for the Siouxland. Look for consolidation and job losses. Probably was inevitable the way Gateway has been stumbling around these past few years.

On the other hand, most of Acer is based in Taiwan without a large US presence like Gateway, North Sioux could GAIN from this.

Acer cuts North Sioux work force
Up to 80 laid off; tech support center will close
By Dave Dreeszen Journal business editor

NORTH SIOUX CITY -- Acer-owned Gateway laid off dozens of workers in North Sioux City on Wednesday as it prepared to close a once-touted tech support center.

The so-called "best practices" center, which opened in late 2006, employed about 80 people. According to local economic development officials, most, if not all, of those workers were given pink slips Wednesday.

Matt O'Kane, one of the workers let go, said the decision came without warning.

"Nobody knew it was going to happen." O'Kane said. "Everybody came into work today and they basically said, 'We'll give you two months' pay, and get out the door.'"

A Gateway spokeswoman could not immediately confirm the layoffs or tech support center closing. But the Journal obtained a copy of a memo Gateway's human resources department sent Wednesday to affected workers.

According to the memo, the company has developed plans for a "mass" layoff at both the North Sioux Center campus and Gateway's former headquarters in Irvine, Calif.

To comply with federal law, the company gave affected workers at least 60 days' notice of the layoffs, which are set to take effect on or about March 30. The memo said affected workers would continue to receive their regular wages and benefits through their termination date. They also would be eligible for a "financial separation package." Details of the package were not disclosed.

The state of South Dakota, the North Sioux City Economic Development Corp. and The Siouxland Initiative put together an incentive package to bring the best-practices tech support center here. At a July 2006 news conference, South Dakota Gov. Mike Rounds and other state and local leaders hailed the center as a healthy sign that the North Sioux City campus had reversed a string of job losses.

The center, part of Gateway's overall strategy to return overseas phone jobs to the U.S. and reduce reliance on third-party partners, once employed more than 100 people, including tech support agents, engineers, technical writers and managers. By handling most support calls internally, Gateway said it hoped to better understand customer complaints, which the company believed would result in better products and stronger customer loyalty in the long run.

Less than a year after the center opened, Gateway agreed to be acquired by Taiwan-based Acer Inc. The $710 million deal created the world's third-largest manufacturer of personal computers. Gateway later sold its professional division to Nampa, Idaho-based MPC Corp.

The two sales effectively split Gateway's work force in North Sioux City in two. The consumer business, now an Acer division, reportedly employed about 400 before Wednesday's layoffs. MPC has about 425 employees in its new North Sioux offices on the second floor of Gateway's former Argentina building.

At a public presentation earlier this month, Kory Menken, executive director of North Sioux City Economic Development Corp., hinted that more layoffs were imminent at the Acer-owned Gateway facilities. About 50 workers were laid off in December.

"While we are disappointed to see additional layoffs at Gateway/Acer, today's events do not come as a complete surprise," Menken said. "This is the exact reason North Sioux City has worked so diligently to diversify and thus stabilize our economic base."

Menken noted that other local employers are adding workers, including Alorica's contract call center, which shares the former Argentina building with MPC. Alorica, North Sioux City's largest employer with about 950 workers, recently announced plans to add 300 new jobs. The displaced Gateway workers have skills and experience that the expanding Alorica center would welcome, local director Mike Freeman said.

"We have clients who want to expand their services here in North Sioux City," Freeman said. "We have plenty of job opportunities available for those who are interested."

http://www.siouxcityjournal.com/articles/2008/01/31/news_business/local/e455000dc77640a9862573e100073372.txt

[siouxperland]

Southern Hills Mall is still fighting & swinging and apparently attracting retailers. Iowa's 2nd Charlotte Russe store (the other is in Valley West in WDM) will open in Southern Hills Mall this summer. Last week Hollister Co. opened a new 5800sf store. The mall is also in the process of assembling & consolidating space on the south side of the west end in hopes of attracting a single user of space that will need 25-30,000 square feet. I'm betting on Bed,Bath & Beyond to take it. Two weeks ago Scheels signed on to acquire another 15,000 square feet inside the mall on the east end near Sears. Maybe some life in the old girl yet and the amazing thing is, it has it's competition Lakeport Commons to the east probably to thank. The additional traffic it's bringing to the area has helped the mall to achieve double digit traffic increases each of the 2 years LC has been open. The GAP opens in Lakeport Commons tomorrow.

Apparel store plans Friday opening at mall

SIOUX CITY -- Hollister Co., a lifestyle brand of Abercrombie & Fitch, will open its new Southern Hills Mall store at 10 a.m. Friday.

The 5,808-square-foot Hollister store is next to Champs Sports, between Center Court and the Sears Wing.

According to its Web site, Hollister Co. specializes in California surfer style apparel for teens and young adults ages 13 through 20.

Though it was started in 2000, Hollister adopted 1922 as the date of its establishment. The number 22 and a flying seagull logo appears on many of its items.


Young women's clothier coming to Southern Hills
12:34 PM

SIOUX CITY -- Charlotte Russe, a national apparel retailer that targets young women, plans to open a store at Southern Hills Mall in May.

The 6,780-square-foot store will occupy two spaces between Center Court and the Sears wing, just west of a new Holister store that opened last week.

Mall officials today announced it had signed a lease with Charlotte Russe Holdings Inc., which operates 430 stores nationwide.

"Charlotte Russe is an exciting fashion apparel store that our customers have been asking for and we're so pleased to be able to bring this store to Sioux City," Kris Walter, senior marketing manager for Southern Hills, said in a statement.

The retailer offers fashionable, value-priced clothing targeting young women in their teens and 20s. In addition to a wide selection of apparel, the stores carry a full range of accessories and footwear.

For a more complete story, read the Journal in print and online Friday.

From Friday's Sioux City Journal
"Southern Hills also has scheduled a 10 a.m. news conference on Feb. 27 to announce the arrival of another "major new store,'' which is set to open this fall. The unidentified tenant has signed a lease for about 30,000 square feet in the JCPenney wing. "

[trailer]

Southern Hills Mall is still fighting & swinging and apparently attracting retailers. Iowa's 2nd Charlotte Russe store (the other is in Valley West in WDM) will open in Southern Hills Mall this summer. Last week Hollister Co. opened a new 5800sf store. The mall is also in the process of assembling & consolidating space on the south side of the west end in hopes of attracting a single user of space that will need 25-30,000 square feet. I'm betting on Bed,Bath & Beyond to take it. Two weeks ago Scheels signed on to acquire another 15,000 square feet inside the mall on the east end near Sears. Maybe some life in the old girl yet and the amazing thing is, it has it's competition Lakeport Commons to the east probably to thank. The additional traffic it's bringing to the area has helped the mall to achieve double digit traffic increases each of the 2 years LC has been open. The GAP opens in Lakeport Commons tomorrow.

Apparel store plans Friday opening at mall

SIOUX CITY -- Hollister Co., a lifestyle brand of Abercrombie & Fitch, will open its new Southern Hills Mall store at 10 a.m. Friday.

The 5,808-square-foot Hollister store is next to Champs Sports, between Center Court and the Sears Wing.

According to its Web site, Hollister Co. specializes in California surfer style apparel for teens and young adults ages 13 through 20.

Though it was started in 2000, Hollister adopted 1922 as the date of its establishment. The number 22 and a flying seagull logo appears on many of its items.


Young women's clothier coming to Southern Hills
12:34 PM

SIOUX CITY -- Charlotte Russe, a national apparel retailer that targets young women, plans to open a store at Southern Hills Mall in May.

The 6,780-square-foot store will occupy two spaces between Center Court and the Sears wing, just west of a new Holister store that opened last week.

Mall officials today announced it had signed a lease with Charlotte Russe Holdings Inc., which operates 430 stores nationwide.

"Charlotte Russe is an exciting fashion apparel store that our customers have been asking for and we're so pleased to be able to bring this store to Sioux City," Kris Walter, senior marketing manager for Southern Hills, said in a statement.

The retailer offers fashionable, value-priced clothing targeting young women in their teens and 20s. In addition to a wide selection of apparel, the stores carry a full range of accessories and footwear.

For a more complete story, read the Journal in print and online Friday.

From Friday's Sioux City Journal
"Southern Hills also has scheduled a 10 a.m. news conference on Feb. 27 to announce the arrival of another "major new store,'' which is set to open this fall. The unidentified tenant has signed a lease for about 30,000 square feet in the JCPenney wing. "

If SHM invested in cosmetic changes 10-15 years ago, they wouldn't need to bring in so many big box tenants. The new store by JCPenney is eating up like 15 existing storefronts.

Is 30,000 sq. feet too small for a Steve & Barry's?

[siouxperland]

If SHM invested in cosmetic changes 10-15 years ago, they wouldn't need to bring in so many big box tenants. The new store by JCPenney is eating up like 15 existing storefronts.

Is 30,000 sq. feet too small for a Steve & Barry's?

Big box in malls seems to be a trend and it's not just Sioux City doing it. It helps keep the mall traffic up which in turn drives up sales per foot which in turn keeps up the quality of the tenants which in turn generates more traffic and so on and so on. Scheels adding 15,000 is an indicator of their traffic alone. One clue is that the Catherine's store in back of the mall by the mall office is part of this project which will allow an outside entrance to the store. The plot thickens. Steve & Barry's can have the old Wal-Mart space on Gordon, a perfect fit for a tenant if there ever was one but their stores range from 50 to 100,000, so this space is probably too small to be a S&Bs. A 30,000 is almost exactly what the average size is for a Borders, Bed Bath & Beyond, Office Depot, Cost Plus World Market, TJMaxx. Borders? Probably not, head to head with B&N is a low margin fight. Bed Bath & Beyond? Could be, they've started to put stores in traditional malls as a way to break into markets. They've been on the board trying to get a SC store for 3-4 years now. Office Depot? Same as BB&B, trying to get a store. Both were slated for a new mall on Sunnybrook but since TJMaxx backed out, that's probably on hold or dead. Cost Plus wanted a store in Lakeport but got nudged out by that craphole Gordmans. Why does one mall need a Gordmans AND a Kohls for 30% of their space? TJMaxx. Hmmm.... since they closed the store in Mayfair and said they were leaving town but not saying they'd never return, this could be a dark horse but unlikely, it'd be higher rent than what they just left plus they could have the old Toys R Us store for half of what they paid in Mayfair. Whoever it is, they're paying to move the existing tenants out into their own new space so the consolidation can happen and that AIN'T cheap. It's someone with some pockets.

[CJG]

So the drama is over ... it is going to be a Steve & Barry's. Great news for Southern Hills Mall and the people in the SC shopping region.

http://www.siouxcityjournal.com/articles/2008/02/27/news_business/local/faca0fd0e701ad86862573fb0077d718.txt