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Belk to purchase Parisian


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I see nothing "frivolous" about the lawsuit. An investor is looking out for his best interest. Belk will not be able to perform at the level of Parisian in most of the locations it just agreed to purchase. I mentioned in some earlier post (either here or in the ATL one) that Belk marred its perception and image by not doing something special at Riverchase. If you live in a mansion then you certainly don't want to be surrounded by trailer trash. And you can try to blow the Southpark and Crabtree smoke up people's asses all day long but as you have read time and time again.... no one believes that Belk can pull this off.

Live on Parisian - lol.

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I see nothing "frivolous" about the lawsuit. An investor is looking out for his best interest. Belk will not be able to perform at the level of Parisian in most of the locations it just agreed to purchase.
That's opinon and not fact. Nobody knows how those stores will perform as Belk...period.

This lawsuit is based on assumption, and as such, has no merit.

I mentioned in some earlier post (either here or in the ATL one) that Belk marred its perception and image by not doing something special at Riverchase.
Belk inherited an underperforming Proffitt's, which was a Saks, Incorporated store, and nothing special overall. With all the key vendor agreements staked out in the mall by other Saks divisons and Federated, and no proven positive sales history from Proffitt's, Belk was stuck.

If you live in a mansion then you certainly don't want to be surrounded by trailer trash. And you can try to blow the Southpark and Crabtree smoke up people's asses all day long but as you have read time and time again.... no one believes that Belk can pull this off.

Live on Parisian - lol.

Southpark and Crabtree smoke? Belk has pulled it off at those malls and dozens of others.

Face it. Parisian is gone.

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That's opinon and not fact. Nobody knows how those stores will perform as Belk...period.

This lawsuit is based on assumption, and as such, has no merit.

Belk inherited an underperforming Proffitt's, which was a Saks, Incorporated store, and nothing special overall. With all the key vendor agreements staked out in the mall by other Saks divisons and Federated, and no proven positive sales history from Proffitt's, Belk was stuck.

Southpark and Crabtree smoke? Belk has pulled it off at those malls and dozens of others.

Face it. Parisian is gone.

Steven, It's not about Parisian rather it is maintaining a "first-class" retailer in the space, and that's not what Bayer Properties sees in Belk even after visiting the SouthPark store. They work in retail, whereas you are a retailer enthusaist, so they most likely have a lot more experience, knowledge, and foresight with the Birmingham retail market. They have been doing this with this retail center successfully since 1997, so it gives them a lot more reputable standing than what you are saying and what you saw in Charlotte. You may think you know, but until you come to Birmingham in person and actually live here and study the area's demographics, you can only assume you know. With that I must agree with Bayer, their reasoning are legit, and the have a right to protect their investment. The space is more suitable to be replaced with a Nordstrom or Dillards rather than a Dillard's. Like I said on the Charlotte forum, Birmingham is not Charlotte or Raleigh, and it will never will be. The type of reputation Belk has in Birmingham (outside of the Riverchase) is still not to highly looked upon.

Here's the story from The Birmingham News:

Summit sues Belk to block retailer

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Steven, It's not about Parisian rather it is maintaining a "first-class" retailer in the space, and that's not what Bayer Properties sees in Belk even after visiting the SouthPark store. They work in retail, whereas you are a retailer enthusaist, so they most likely have a lot more experience, knowledge, and foresight with the Birmingham retail market. They have been doing this with this retail center successfully since 1997, so it gives them a lot more reputable standing than what you are saying and what you saw in Charlotte. You may think you know, but until you come to Birmingham in person and actually live here and study the area's demographics, you can only assume you know. With that I must agree with Bayer, their reasoning are legit, and the have a right to protect their investment. The space is more suitable to be replaced with a Nordstrom or Dillards rather than a Dillard's. Like I said on the Charlotte forum, Birmingham is not Charlotte or Raleigh, and it will never will be. The type of reputation Belk has in Birmingham (outside of the Riverchase) is still not to highly looked upon.

Here's the story from The Birmingham News:

Summit sues Belk to block retailer

All this hearsay of who's better and more first class is ridiculous. I've been in the Saks at the Summit and I can tell you, I've seen Saks stores that are 10 times better and more upscale. I've also seen Parisian stores that look like crap compared to the Summit. It's all opinion. Bayer "thinks" Belk isn't as first-class as Parisian. Has Bayer looked at some of the Parisian stores out there (i.e. Gadsden, AL). It was a remodeled McRae's and hardly anything to be proud of in the Parisian chain. I think (and again, this is MY opinion) that if Belk has to "step-up" their game to compete on the level of the first-class store mix at the Summit, then they will do that. Everyone knows that department stores have certain "levels" or "classes" of stores that cater to the specific demographic of the location. Obviously, a Saks in Birmingham isn't going to sell quite the same mix of merchandise as a Saks in say, Beverly Hills or New York City. They offer different clientele's. Same goes for Belk. They cater to the location of the store. I'm from Guntersville, AL and the new Belk there is nothing compared to the Galleria Belk (which is apparently nothing compared to Southpark).

It's all relative.

And has anyone considered what happens if Bayer actually succeeds in kicking Belk/Parisians out of the Summit? Do they have a verbal committment by any other retailers to enter the market? Do they have any type of non-compete clause with Saks whereas they will not pursue a competing upscale company? And virtually by Bayer's own definition, they would even excluse Macy's because Macy's has become a diluted nationwide brand that isn't exactly considered first-class (at least to me) any longer. Macy's first class counterpart would be Bloomingdales (the sister flag at Federated).

Anyway, just a lot to think about.

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All this hearsay of who's better and more first class is ridiculous. I've been in the Saks at the Summit and I can tell you, I've seen Saks stores that are 10 times better and more upscale. I've also seen Parisian stores that look like crap compared to the Summit. It's all opinion. Bayer "thinks" Belk isn't as first-class as Parisian. Has Bayer looked at some of the Parisian stores out there (i.e. Gadsden, AL). It was a remodeled McRae's and hardly anything to be proud of in the Parisian chain. I think (and again, this is MY opinion) that if Belk has to "step-up" their game to compete on the level of the first-class store mix at the Summit, then they will do that. Everyone knows that department stores have certain "levels" or "classes" of stores that cater to the specific demographic of the location. Obviously, a Saks in Birmingham isn't going to sell quite the same mix of merchandise as a Saks in say, Beverly Hills or New York City. They offer different clientele's. Same goes for Belk. They cater to the location of the store. I'm from Guntersville, AL and the new Belk there is nothing compared to the Galleria Belk (which is apparently nothing compared to Southpark).

It's all relative.

And has anyone considered what happens if Bayer actually succeeds in kicking Belk/Parisians out of the Summit? Do they have a verbal committment by any other retailers to enter the market? Do they have any type of non-compete clause with Saks whereas they will not pursue a competing upscale company? And virtually by Bayer's own definition, they would even excluse Macy's because Macy's has become a diluted nationwide brand that isn't exactly considered first-class (at least to me) any longer. Macy's first class counterpart would be Bloomingdales (the sister flag at Federated).

Anyway, just a lot to think about.

Word has been thrown around that Nordstrom would probably wind up there. They have been looking for a Birmingham location on and off since 2003. However, I've heard about Bloomingdale's also, but I would rule out a top-noch Dillard's either. Bayer has a lot of upper-price to upscale retailers that are still begging to locate at the center in the final part of Phase IV. So believe me when I say, they would have a problem replacing that space with another upscale retailer.

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The Summit has some "upper end" stores (BCBG, Pottery Barn, Harold's, etc, etc) but nothing "upscale" as in Cartier, Hermes, Prada, Gucci, Tiffany, Valentino, etc, etc. The Saks Fifth has had the interior sales floor "shrunken" by walling off sections since it opened due to poor sales (this happened while I worked for Saks Inc).

Additionally, I was The Summit two weeks ago and they DO have Pier 1, Kay Jewelers, Bed Bath & Beyond and Old Navy, all of which are found in every city and mall around the nation. Not upscale players by any means. Seems Bayer has some sour grapes over the loss of Parisian.

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The Summit has some "upper end" stores (BCBG, Pottery Barn, Harold's, etc, etc) but nothing "upscale" as in Cartier, Hermes, Prada, Gucci, Tiffany, Valentino, etc, etc. The Saks Fifth has had the interior sales floor "shrunken" by walling off sections since it opened due to poor sales (this happened while I worked for Saks Inc).

Additionally, I was The Summit two weeks ago and they DO have Pier 1, Kay Jewelers, Bed Bath & Beyond and Old Navy, all of which are found in every city and mall around the nation. Not upscale players by any means. Seems Bayer has some sour grapes over the loss of Parisian.

There's a Tiffany's store inside of the Saks. I've heard some people mention that Prada has thought of entering the market either with a store at The Summit or Brookwood Village back in 2003 or 2004 when Phase IV was still being planned, but did to the economy the turned down the idea. Over time, it is pretty much public knowledge that Bayer is weening out the typical retailers because they are planning on repositioning the center towards those of the upper incomes and young urban professionals.

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Steven, It's not about Parisian rather it is maintaining a "first-class" retailer in the space, and that's not what Bayer Properties sees in Belk even after visiting the SouthPark store. They work in retail, whereas you are a retailer enthusaist, so they most likely have a lot more experience, knowledge, and foresight with the Birmingham retail market. They have been doing this with this retail center successfully since 1997, so it gives them a lot more reputable standing than what you are saying and what you saw in Charlotte. You may think you know, but until you come to Birmingham in person and actually live here and study the area's demographics, you can only assume you know. With that I must agree with Bayer, their reasoning are legit, and the have a right to protect their investment. The space is more suitable to be replaced with a Nordstrom or Dillards rather than a Dillard's. Like I said on the Charlotte forum, Birmingham is not Charlotte or Raleigh, and it will never will be. The type of reputation Belk has in Birmingham (outside of the Riverchase) is still not to highly looked upon.

Here's the story from The Birmingham News:

Summit sues Belk to block retailer

I read that story, and I still think it's a stupid lawsuit based on assumptions.

Leonard, I hate to break it to you, but a lot of people who are in retail, even high-end retail, have no passion for it. This is even more common in retail real estate. The people at Bayer may be armed with demographic reports and MBAs, but I can guarantee you that I'm just about as good a judge at these sorts of things as anyone in the industry, a fact echoed by people in the industry that I've met and talked to.

The problem Belk has is that it's taking the place of a well-thought of regional store in an upscale mall. That's their only problem. Belk deals with all the same vendors and operates stores of a similar if not identical class level. Bayer's reaction is a kneejerk one because they think if they advertise Belk at the Summit, no one will come. Which is bollocks, but I'm tired of trying to prove this to the unconvertable.

My guess is that if they sucessfuly kick Belk out, which is doubtful given the nature of the lawsuit, they won't land the higher-end stores they think they will. Neiman Marcus is not coming to Birmingham anytime soon, and neither is Barneys. Saks is already there (and apparently shrinking), and Nordstrom is tied up in its own heavily loaded expansion schedule. Macy's isn't exactly flourishing in the market either.

Their only recourse without Belk in place is to leave a dead anchor for several years until the market catches up to the desired demographics for the retailers they want or to divide or demolish the store for a series of smaller retailers.

Either action comes with a lot bigger risks than letting Belk occupy the store and letting the market decide if it wants it there. Their best hustle is to let this stupid suit subside and let people who shop at The Summit vote with their wallets.

I've heard some people mention that Prada has thought of entering the market either with a store at The Summit or Brookwood Village back in 2003 or 2004 when Phase IV was still being planned, but did to the economy the turned down the idea.
Prada's not coming to any mall I know of. They don't do malls generally. They design eccentric stores that aren't really condusive to mall leasing plans.
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With all due respect, I disagree about the lawsuit. As a lawyer, my first reaction to the lawsuit was that it was bunk and that Bayer had absolutely no chance of winning, as a requirement in a lease that a retailer operate a "first-class" store typically means just that it has to operate a decent name-brand store (i.e., not an off-price or run-down store). I would assume that Belk also did enough due diligence to ensure that Parisian stores could be transferred to it.

But the fact that Bradley Arant is representing Bayer speaks volumes. That is a first-tier law firm in Birmingham and is not full of slimy slip-and-fall lawyers. The firm would probably counsel Bayer to back off if the suit had no merit. I also saw a few references in the current Birmingham Business Journal about the lease; it could be tightly crafted enough to block Belk from replacing Parisian. The firm could be doing the suit just as a favor for a good client, but no reputable law firm would damage its reputation by pursuing a frivolous lawsuit.

I still think that Bayer has an uphill battle ahead, but now I think that the suit has more merit than I initially did.

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What kinds of legal precedents does it set for the retail industry if Bayer wins?

That parties to contracts must follow them.

Based on the Birmingham Business Journal article, apparently Parisian has to operate a store called "Parisian" at the Summit. If that's what Parisian and Bayer agreed years ago, without a legal way of getting out of its agreement (e.g., fraud, duress, breach by Bayer, etc.), then Parisian is bound to operate a store called "Parisian", and successors would generally be bound by that agreement.

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Steven, Dillard's could easily placed in the spot. Dillard's tends to have a better reputation than Belk in Alabama. They also have a decent reputation nationally with its locations in higher end malls like Scottsdale Fashion Square, Perimeter Mall and many others. It does have class B and C stores like all chains, but Dillard's just has a better rep with Alabamians in general. It also seems to have a target demographic very similar to a typical Parisian. So in other words, they wouldn't have a big problem finding somebody to replace the store.

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Steven, Dillard's could easily placed in the spot. Dillard's tends to have a better reputation than Belk in Alabama. They also have a decent reputation nationally with its locations in higher end malls like Scottsdale Fashion Square, Perimeter Mall and many others. It does have class B and C stores like all chains, but Dillard's just has a better rep with Alabamians in general. It also seems to have a target demographic very similar to a typical Parisian. So in other words, they wouldn't have a big problem finding somebody to replace the store.

I don't know what everyone on this board finds so appealing about Dillard's. I have never noticed a dimes worth of difference between Belk and Dillard's. If the Summit is aiming towards upscale, to me Dillard's is heading in the wrong direction. The only stores I see working would be Neiman Marcus, Lord and Taylor, Bloomingdales, or Nordstrom.

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Now that's it's been brought up... I don't know how Bayer can refer to the Summit as upscale with the likes of Old Navy, BBB, Pier 1 and others. You would be hard pressed to find a store that discounts their clothing more than Old Navy (and the entire Gap chain for that fact) over the span of a single season. And if they're going to upscale, they should really think about forcing Carmike to either remodel and update or get out of the theatre space. They are much nicer and more respectable theatre chains opporating in my opinion than Carmike.

And let's move on down the row, Bruno's... They're hardly an upper level grocer any longer with the likes of Publix and Whole Foods showing up in Birmingham. Is Bayer going to attempt to kick them out soon as well.

I mean, an argument could be made for just about any of the stores in at the Summit and whether they are upscale or upper class or first-rate.

Bayer should just let Belk take over the store, stock it the way they want and if people don't like the store, they won't buy. As someone else said, let them vote with their dollars.

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That parties to contracts must follow them.

Based on the Birmingham Business Journal article, apparently Parisian has to operate a store called "Parisian" at the Summit. If that's what Parisian and Bayer agreed years ago, without a legal way of getting out of its agreement (e.g., fraud, duress, breach by Bayer, etc.), then Parisian is bound to operate a store called "Parisian", and successors would generally be bound by that agreement.

That's the dumbest thing I've ever heard! What relevance does the name have in any of this, and why would Saks sign a contract that would even agree to that?

If this notion of the name was truly a lawsuit-inducing sticking point, then nobody who bought this store as a continuing operation could change the name to anything else. Store names and concepts change so much that it's nearly impossible to guarantee any store will remain the exact same for more than a few seasons. Even if they kept the store, if Saks themselves wanted to alter the store name, it legally could not according to their operating agreement as stated, which makes no sense.

Belk's lawyers could easily and successfully argue that their responsibility is to maintain the space in a manner appropriate to its location. Further, Bayer has no legally proveable data that would suggest Belk would operate anything less than an equivilent store in that location.

Trying to argue that the name must stay for reasons unbeknowst to anybody other than Bayer is just wasting the judge's time. Maintianing a single store as a seperate nameplate to make one developer happy makes no sense.

The real reason behind this lawsuit is that Bayer is trying to force Belk out. The name argument is just a legal ruse to base it on.

I don't know what everyone on this board finds so appealing about Dillard's. I have never noticed a dimes worth of difference between Belk and Dillard's. If the Summit is aiming towards upscale, to me Dillard's is heading in the wrong direction. The only stores I see working would be Neiman Marcus, Lord and Taylor, Bloomingdales, or Nordstrom.
None of which are headed to Birmingham any time soon.

Steven, Dillard's could easily placed in the spot. Dillard's tends to have a better reputation than Belk in Alabama...So in other words, they wouldn't have a big problem finding somebody to replace the store.
Throwing out Belk to put in a Dillard's is preposterous. I'm very familar with both chains and the differences between them are so small they're practically invisible.
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That's the dumbest thing I've ever heard! What relevance does the name have in any of this, and why would Saks sign a contract that would even agree to that?

If this notion of the name was truly a lawsuit-inducing sticking point, then nobody who bought this store as a continuing operation could change the name to anything else. Store names and concepts change so much that it's nearly impossible to guarantee any store will remain the exact same for more than a few seasons. Even if they kept the store, if Saks themselves wanted to alter the store name, it legally could not according to their operating agreement as stated, which makes no sense.

Belk's lawyers could easily and successfully argue that their responsibility is to maintain the space in a manner appropriate to its location. Further, Bayer has no legally proveable data that would suggest Belk would operate anything less than an equivilent store in that location.

Trying to argue that the name must stay for reasons unbeknowst to anybody other than Bayer is just wasting the judge's time. Maintianing a single store as a seperate nameplate to make one developer happy makes no sense.

The real reason behind this lawsuit is that Bayer is trying to force Belk out. The name argument is just a legal ruse to base it on.

None of which are headed to Birmingham any time soon.

Throwing out Belk to put in a Dillard's is preposterous. I'm very familar with both chains and the differences between them are so small they're practically invisible.

Uh Steve, contrary to what you say. Dillard's and Nordstrom are both eyeballing the market and have been for awhile now there was a story in the Birmingham News discussing this.

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That's the dumbest thing I've ever heard! What relevance does the name have in any of this, and why would Saks sign a contract that would even agree to that?

If this notion of the name was truly a lawsuit-inducing sticking point, then nobody who bought this store as a continuing operation could change the name to anything else. Store names and concepts change so much that it's nearly impossible to guarantee any store will remain the exact same for more than a few seasons. Even if they kept the store, if Saks themselves wanted to alter the store name, it legally could not according to their operating agreement as stated, which makes no sense.

Belk's lawyers could easily and successfully argue that their responsibility is to maintain the space in a manner appropriate to its location. Further, Bayer has no legally proveable data that would suggest Belk would operate anything less than an equivilent store in that location.

Trying to argue that the name must stay for reasons unbeknowst to anybody other than Bayer is just wasting the judge's time. Maintianing a single store as a seperate nameplate to make one developer happy makes no sense.

The real reason behind this lawsuit is that Bayer is trying to force Belk out. The name argument is just a legal ruse to base it on.

None of which are headed to Birmingham any time soon.

Throwing out Belk to put in a Dillard's is preposterous. I'm very familar with both chains and the differences between them are so small they're practically invisible.

I checked with some of my lawyer friends who specialize in shopping center leases for their feedback to back up my thoughts.

Typically, a lease would require that a tenant operate store X in a space for Y number of years, although the tenant could change to operating store Z with the consent of the landlord. The precise wording of this would depend on how much leverage each party had during the negotiations. Landlords want to ensure that retailers operate stores that fit the tenant mix the landlords want in their centers. This is a common feature of contracts in other areas as well; parties can be switched out of the contract often only with the consent of the other parties. Sometimes the consent can be withheld for any reason (in which case a landlord can often do something such as extract higher rent or more favorable lease terms in exchange for allowing nameplate switching); sometimes a retailer can require that the landlord refuse to consent only reasonably.

In the mid-1990s, let's recall, Parisian was still an independent chain so switching nameplates probably wasn't something that Parisian negotiators were extremely concerned with. Parisian might have wanted to ensure its dominance in Birmingham and land a spot in a high-end shopping center so I'd guess that the Summit developer could get Parisian to agree to landlord-friendly terms.

There was an article about leverage in lease negotiations in the ICSC website news section a few months ago; Target and other in-demand big-box stores can basically force landlords to agree to tenant-friendly leases, while less-desirable retailers have much less leverage.

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Uh Steve, contrary to what you say. Dillard's and Nordstrom are both eyeballing the market and have been for awhile now there was a story in the Birmingham News discussing this.
Uh Leonard, I read the same article and it's the typical "We're scouting sites and we really like the market" article. This really means next to nothing without signed leases. Many times retailers will evaluate potential markets, but it doesn't always mean there's a strong interest.

For Dillard's part, they're more interested than Nordstrom, because they're going to be taking over a couple of Parisian spots in Birmingham. Nordstrom, however, is still looking, and may ultimately pass because of lack of suitable locations.

In the mid-1990s, let's recall, Parisian was still an independent chain so switching nameplates probably wasn't something that Parisian negotiators were extremely concerned with. Parisian might have wanted to ensure its dominance in Birmingham and land a spot in a high-end shopping center so I'd guess that the Summit developer could get Parisian to agree to landlord-friendly terms.

There was an article about leverage in lease negotiations in the ICSC website news section a few months ago; Target and other in-demand big-box stores can basically force landlords to agree to tenant-friendly leases, while less-desirable retailers have much less leverage.

Still, Bayer is enforcing this portion of the lease because it's a Belk store going in. If Parisian had sold to Lord & Taylor, or Nordstrom, or even Dillard's, this portion of the operating agreement wouldn't have gone to the lawsuit level. As I've said before, this lawsuit is based on assumptions and Bayer's desire to enforce a techincality to force Belk to close thir store. It's full of crap.
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