The RoomPlace plans Dayton expansion

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LOMBARD, Ill. — The RoomPlace will enter the Dayton, Ohio, market next year, part of a three-store expansion plan that builds on the early success of its first mall store opened in Peoria, Ill., this spring.

The Top 100 company will open two stores in Dayton, starting with a 51,000-square-foot showroom in the 1.4 million-square-foot Dayton Mall near interstates 75 and 675. It’s tentatively slated to open in late summer 2019.

Also, a 57,000-square-foot store is expected to open in the fall of 2019 in The Mall at Fairfield Commons in the Dayton suburb of Beavercreek, Ohio, where RoomPlace will take the upper level of a Sears space.

In addition, before either store opens, The RoomPlace plans to take 82,000 square feet for a showroom and clearance outlet in Lincolnwood Town Center, in the Chicago suburb of Lincolnwood, Ill. There, the retailer is replacing a former Carson Pirie Scott department store, with an opening tentatively planned for next spring.

The 27-store promotional to mid-priced retailer opened its first mall store in May in Northwoods Mall in new market Peoria, Ill., where both sales and traffic have exceeded expectations, RoomPlace Chairman Bruce Berman told Furniture Today. That was part of a three-store expansion the company announced less than three months ago.

“We have found the strategy of mall locations — with entrances from the parking lot and the interior mall — have led to more traffic than we’ve ever seen an any of our store before,” he said.

Indeed, Berman said, the traffic has been so extraordinary the company has had to change one of its standards for evaluating that store and its management’s performance — away from strict close-ratio metrics — because the mall store will see a thousand or more people over a given weekend. Most of them don’t buy, but the exposure is a big positive, he said.

All of the retailer’s new mall leases, including in Peoria, are deals with real estate investment trust Washington Prime Group. Malls across the country have suffered anchor tenant vacancies primarily due to department store closings in the wake of online competition, and the properties controlled by Washington Prime apparently are not an exception.

In its own release, the REIT said the lease deals with The RoomPlace speak to “its anchor repositioning objective and its focus on diversifying tenancy.”

“When an outstanding furniture retailer with a venerable 100-year history takes vacated department store space, let’s just say if I were an emoji kind of person, there’d be a smiley face or two illustrating our happiness,” Washington Prime CEO Lou Conforti said in the release.

Ask if he was concerned about the current plight of malls these days given the loss of department store anchors, Berman said he might be if the RoomPlace stores didn’t feature their own exterior entrances.

He added that in the case of the four malls RoomPlace is entering, vacancy rates are low. What’s more, unlike smaller operators within the mall, RoomPlace’s business isn’t dependent on the traffic pulled in by other anchor tenants.

Before its most recent openings in Peoria and Indianapolis, RoomPlace showrooms have averaged 25,000 to 30,000 square feet, Berman said. The mall properties are ranging 50,000 to 80,000 square feet, which “really give us a chance to put out our whole assortment,” he said, adding that’s another advantage to the mall strategy.

“But the biggest thing is these malls have traffic,” Berman said. Mall shoppers visiting other retailers or for entertainment and dining have been curious about the furniture store and are coming in. It’s a reversal of the declining traffic trend many furniture stores have been experiencing.

“It’s been amazing,” he said. “The same people you see in the mall putting a dollar in those massage chairs? They love it when they come in our stores. They can (experience the massage chair) for free.”

Dayton will be The RoomPlace’s fourth new metro market entry outside of Chicagoland. Berman said part of the attraction is the less than two-hour drive from the retailer’s Indianapolis warehouse, making the market easy to service with existing distribution center capacity.

There are three or four other markets in Ohio and Kentucky within that same radius The RoomPlace is evaluating for expansion, too, Berman added.

He declined to disclose the company’s investment in the latest expansion moves or sales projections. The RoomPlace is No.50 on Furniture Today’s Top 100 with an estimated $170 million in 2017 furniture, bedding and accessory sales at 27 stores, in greater Chicago and Indianapolis.

Other previously announced openings are slated for this year in Gurnee, Ill., in Gurnee Mills outlet center in metro Chicago (by Labor Day); and in Pleasant Prairie , Ill., which will mark the retailer’s entrance into the metro Milwaukee market (by yearend).

Berman said business this year has been challenging, but he noted it’s not wise to plan growth around short-term economic expansion and contraction cycles.

“You have to look at it over the long term and make sure the moves you are making are going to help you in the future,” he said, adding that RoomPlace is using its fixed assets and capacity already at its disposal.

“There is always going to be share, and I think the better companies are going to get it,” he said. “We’re counting on being one of those.”

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