New Outlet Collection owner promises ‘hands-on’ management
Even before the COVID-19 pandemic ended New Orleans’ tourism industry in 2020, prompting 10 tenants to leave The Outlet Collection at Riverwalk, longtime owner The Howard Hughes Corporation was looking for a buyer.
RockStep Capital Chairman Andy Weiner said he didn’t want to miss the opportunity. His Houston-based real estate investment firm acquired the waterfront mall this summer for an undisclosed price.
“We saw an opportunity to buy a major asset in a dynamic market, where we would do hands-on leasing and creative management with a city and community that wanted to see this property excel and do something that would create positive energy. “, says Weiner.
Opportunity comes with significant challenges. The mall has relied on tourists to survive since it was converted from vacant warehouse space after the World’s Fair in the mid-1980s, and those numbers haven’t fully returned since 2020.
It currently has over 75 retailers and restaurants, including high-end brands such as Coach, Kate Spade and Polo Ralph Lauren. That wasn’t enough to sustain long-term success, however, according to Louisiana Commercial Realty agent and broker Robert Hand.
“The challenge with this mall is that it never got to take advantage of its location and the stores weren’t able to attract enough customers to make money,” Hand said. “Which is such a shame as the location is great and in any other city a mall on a waterway with a great view would be the top choice for shopping. But they couldn’t take advantage of it. »
Rockstep Capital executive vice president of leasing Michelle Waak, who previously worked for The Howard Hughes Corporation, said the property, formerly known as Riverwalk Marketplace, looked dark and dated at the time of its acquired from General Growth Properties in 2011. It reopened in 2014 after an $84 million renovation.
“We opened at 95-96% occupancy,” Waak said. “It was great. The retailers jumped on the bandwagon, got the deals done, and we opened really strong.”
Renamed The Outlet Collection at Riverwalk, it was fully let from 2016 until the pandemic, she said. Meanwhile, he touted the opening of Nordstrom Rack, one of two in Louisiana.
The recent loss of tenants, which left 40,000 feet of empty space, is partly due to online shopping and the inability of retailers to adapt, according to Hand.
“We’re going to outgrow COVID and start having a lot of conventions like we used to and that will bring in more business,” he added. “If they can replace those lost tenants with really interesting and unique tenants that offer special products that will attract shoppers, that will keep people coming back to shop.”
Weiner said the mall “needs hands-on creative management to bring it to its full potential.” He said the goal is full occupancy in 24 to 36 months.
“We will be able to do that, and the tenants who come will be better off than the tenants who left because of COVID,” he said. “We have signed a letter of intent with a large luxury house. There are three other luxury tenants we are negotiating with who have said they want to be in the property. He declined to name the tenants.
RockStep plans to make improvements over the next three to four years to the adjacent Spanish Plaza to make it “a major destination for food, entertainment, and one of the main gateways to the Riverwalk itself.”
“We think the current energy level, the current spiciness, is just very low and we would like to reinvigorate Spanish Plaza with a series of quality high end restaurants with covered outdoor seating as well as some kind of public stage so that we can showcase culture-carriers on a regular basis,” Weiner said. “Plus, we’d like the fountain to be more fun, more entertaining, and more artistic.”
Hand said the key to attracting business would be giving customers a reason to visit.
“The challenge for someone who owns a mall is to discriminate in a way that the stores have synergy with each other,” he said. “You can’t have stores there that they also have in Lakeside or Clearview.”