A Recipe for Retail Success

When Susan Falco meets her friends for dinner, they often converge on Ridge Hill, the outdoor shopping center in Yonkers. “Everyone loves the Yard House,” she raves. That isn’t the only reason you’ll find her driving the 15 minutes from her home in New Rochelle to the mall, tucked between the Sprain Brook Parkway and New York State Thruway.

There’s the Apple store, a frequent destination for Falco and one of her grown daughters. Sometimes she’ll peek into the Vera Bradley shop, to check out the colorful cotton handbags and accessories. Falco also likes iFly, the indoor-skydiving hub, where she spent one Easter with her two daughters and son-in-law for fun. 

That’s not to mention conveniences like the nearby office of WESTMED Medical Group, where she once had to see a doctor during off-hours. “It was very nice, very upscale,” she says, adding about Ridge Hill overall: “You’d have no worries walking around late at night or in the early morning.”

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Falco — along with many other Westchester residents — is doing just what Forest City Ratner, the Brooklyn-based developer of Ridge Hill, wants her to do: keep finding new reasons to visit the mall. By offering plenty of options for dining, shopping, and entertainment that consumers can’t typically find under one roof in Westchester, the developers hope to make that easy.

Open for business since 2011, Ridge Hill is part of a growing national trend toward outdoor malls. With traditional malls facing challenges such as competition from e-commerce, overbuilt retail, and consumers who simply aren’t as jazzed as they once were about hanging out at the mall, more developers are turning to outdoor town centers, filled with draws that go far beyond Memorial Day sales.

“You have to create an experience that people can’t get on their phones or on their computers.”

 — Meghann Miraglia, Director of Marketing for Ridge Hill 

“It’s about the experience,” says Meghann Miraglia, director of marketing for Ridge Hill and vice president of marketing for Forest City Ratner, which not only runs Ridge Hill but was also the force behind other high-profile projects, such as the New York Times building in Manhattan and Barclays Center, the sports-and-entertainment arena in Brooklyn. “You have to create an experience that people can’t get on their phones or on their computers.”

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Although Ridge Hill is designed to mimic the Main Street vibe of Westchester’s small towns and villages, the 1.3 million sq ft mixed-use development aims to bring together lures you won’t find in a quaint downtown — or at another mall in the county. In addition to mainstays such as Lord & Taylor and the Gap, Ridge Hill includes specialty stores, such as Uniqlo and L.L. Bean; activity-oriented destinations, like LEGOLAND Discovery Center and Rockin’ Jump trampoline park; and convenient upscale extras, such as a Whole Foods and an LA Fitness health club. There’s also a Showcase Cinema de Lux movie theater. Seasonal events, such as Octoberfest and outdoor summer concerts, add to the mix.

Next door to the 70 retail shops, eateries, and experiential tenants is the separately owned office complex, with 150,000 square feet of space, where WESTMED is located, and 162 luxury condos at Monarch at Ridge Hill, available to rent or buy. (Rents for 1,232 sq ft, two-bedroom condos are listed online at $3,620 per month or more.) Meanwhile, developers are trying to finalize a deal to add a 152-unit hotel.

“It’s become a destination,” says Daniel Casiero, vice president of retail development at Forest City Ratner. “You can come work, shop, dine and go to a movie theater. I like to say we’ve created a new downtown in Yonkers.”

Shoppers are flocking. Traffic at Ridge Hill was up 6 percent last year, with the mall hosting more than 7.3 million visitors. Sales, too, rose 5 percent in 2016. 

Although the mall hit some recession-related construction delays after it broke ground in 2007, those challenges are now in the rearview mirror. With more than 80 percent of its space leased, Ridge Hill currently generates $700 per square foot in revenue, Casiero says. Nationally, malls average $467 per square foot.

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That puts Ridge Hill among a fortunate group of malls. While the Class B and C malls that are home to moderately priced stores like JC Penney are faltering, higher-end malls catering to affluent consumers are by many accounts still showing growth — mirroring the growing economic gap between middle-class consumers and those at the higher end of the income scale. (Westchester’s average household income, estimated at $135,000 in 2016 — 8 percent higher than Manhattan’s — contributes to high retail spending, and by extension, retail rents, according to a retail market report published by Admiral Real Estate Services in November.)

Nonetheless, all mall operators have to stay on their toes in the current environment. In Westchester, several malls — including The Galleria and City Center in White Plains — have been sold within the past two years, according to Admiral’s report. Meanwhile, The Galleria and City Center, along with The Westchester, are also undergoing major renovations.

It’s not likely the county will see many more traditional malls opening up anytime soon. Nationwide, the barriers to entry for indoor malls — such as the need to acquire giant parcels of land — are too high, especially for larger projects. “There probably aren’t a whole lot more of those big, ground-up, super-regional centers — the Roosevelt Fields of the world — that are going to happen,” says Matt Billerbeck, senior vice president at CallisonRTKL, a global architecture-and-design firm that designed Roosevelt Field on Long Island and Tysons Corner Center in Virginia. 

Those still interested in developing malls often find that building an outdoor, mixed-use destination is less onerous. “It’s an easier investment,” says Billerbeck. But to survive, mall owners need to deliver a much more varied experience than many traditional malls offer. People need a compelling reason to keep showing up, even when The Weather Channel forecasts rain, snow, or ice. 

“It’s not just shopping they want,” Billerbeck says. “It’s this whole social thing, with friends and families. It takes the place culturally of what public squares and downtown Main Street did. It is that traditional gathering place of the community.”

Tenants like Rockin’ Jump ­— which has leased 25,000 square feet of space at Ridge Hill since November — can attest to that. So far, business at Rockin’ Jump has been “very strong,” according to Alex Byall, senior vice president of Amphibious Holdings, which owns the Rockin’ Jump franchise in Ridge Hill Mall, as well as four other existing locations and two under construction. 

Both its location at the mall — with its many attractions — and the way Ridge Hill is run have contributed to the store’s success, Byall believes.

“They run the mall as a very tight ship,” he says. “You don’t see any trash lying around. Everything is clean. The people who run themall come through the space on a regular basis. There’s a real sense of ownership there.”

To insulate itself from the overall turmoil in retail, Ridge Hill tries to stick with tenants that are doing well. But it’s not an exact science. “It’s not something you can foresee and say, ‘This chain is going to be successful moving forward,’” Casiero says. 

Another huge draw for many malls around the US is food. Given the large number of high-quality dining choices in Westchester, restaurants situated in malls have a high bar to hurdle. Both Bonefish Grill and BRIO Tuscan Grille closed after opening locations at Ridge Hill. In cases like that, when things start going south for a tenant, Forest City Ratner moves quickly to prevent vacancies.

“Our job is to continually monitor the sales of our shopping centers, as well as each individual tenant,” says Casiero. “Sometimes we’ll have a warning or idea a tenant is struggling. We try to get ahead of the curve. If we see someone struggling, we may recapture the space. We try to stay on top of it and re-lease it to another tenant.”

That means constantly keeping an eye out for exciting new enticements to add to the mall mix. To that end, the first Lowe’s Home Improvement store in Westchester is scheduled to open by this summer. “We continue to add new stores and new restaurants every year,” says Miraglia. 

Of course, that’s not always possible. In the meantime, Forest City Ratner is hoping it will benefit from new trends, such as retailers who get a fitting room ready with clothing a shopper has preselected online, or enticing consumers to pick up online purchases at a local mall store.

Whether a higher level of service will continue to win over shoppers and insulate Ridge Hill from the threats facing so many mall retailers remains to be seen.   

Elaine Pofeldt is a freelance journalist who writes about entrepreneurship and careers. She is a former senior editor at Fortune Small Business.

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