The Oaks Renovation on Hiatus After Fed, May Merger
One reaction to the merger of Federated Department Stores Inc. and May Department Stores Co. is to wait until the dust settles.
The Macerich Company decided to put its estimated $150 million renovation and expansion of The Oaks shopping center on hiatus until it has a clearer view on the direction of the merger, according to Scott Mitnick, assistant city manager of the City of Thousand Oaks, Calif., where The Oaks is located.
One of the planned anchors for the renovation was to be a 250,000-square-foot Robinsons-May flagship store. The merger has made the future of this department store uncertain, and many retail analysts expect Robinsons-May to be shuttered or converted to other nameplates within Federated’s portfolio.
Upon hearing that the merger was confirmed, Scott Brant, project manager for the Santa Monica, Calif.–based Macerich, called Mitnick on Feb. 28 to cancel scheduled municipal hearings on the renovation plans. Brant did not reply to interview requests.
Macerich is reviewing different options on what other retailers it can put in in place of Robinsons-May. Mitnick said Macerich has not dropped the project. “There is a lot of uncertainty in the air,” Mitnick said. “But the demographics of this community are so strong, and the local economy is so solid, we’re confident the mall will be renovated.”
So far, the merger has not sent a similar chill through the rest of the industry, according to Malachy Kavanaugh, a representative of the New York–based International Council of Shopping Centers. “The mall industry has survived through bankruptcies, mergers and acquisitions,” Kavanaugh said. “They’ve always re-tenanted.” —Andrew Asch
