Barneys is poised to make its second Dallas debut

  1. Barneys is poised to make its second Dallas debut

    Wednesday, September 27, 2006

    By MARIA HALKIAS
    The Dallas Morning News


    Barneys is back.

    On Friday, Barneys New York Inc. reopens in Dallas to complete a chapter in its comeback and serves as the fashion finale to a $225 million expansion at NorthPark Center. The 88,000-square-foot, two-level store – Barneys' largest outside of New York and Beverly Hills – displays its designer goods in its own taste, luxury and humor.

    A mannequin's head is a boot that goes with the outfit. Wall art in the youthful men's and women's Co-op sections is molded from blue jeans. A horse sculpted from clothes hangers peaks into a spiral staircase, built wide enough for a landing with seating.

    The exterior mall entrance facing Boedeker Street is a 2 ½-story glass and steel sculpture by John-Paul Phillipe that practically screams it's not an ordinary department store.

    "Last time we didn't give Dallas the full treatment," said Howard Socol, Barneys New York's chief executive since 2001. "You have Forty Five Ten, Neiman Marcus and Stanley Korshak, some of the great retailers, but we think we're bringing you something different."

    He added: "We're a new company and just completed three years of spectacular growth."

    Both the store and the mall were foundering the first time they were linked.

    When Barneys left NorthPark in 1997, it was mired in bankruptcy. The company closed all but three stores in New York, Chicago and Beverly Hills.

    Rivals, including Neiman Marcus Group and Saks Inc., couldn't sign confidentiality agreements fast enough to have a look at its poor financials.

    At the same time, NorthPark was in the early stages of planning a major expansion.

    The mall's Neiman Marcus was consistently No. 1 or 2 in the Dallas-based luxury chain, but shoppers wanted more.

    NorthPark's husband-and-wife owners, David Haemisegger and Nancy Nasher, launched a transformation.

    Since Nordstrom opened last fall, the mall has completed its square shape, with 90 additional stores and filled its middle with a park.

    "NorthPark's owners do things in a very beautiful way. We think we're cut from the same DNA," Mr. Socol said.

    Expansion

    He was looking for a Co-op store location, which he put in Houston, but decided to go with a flagship store in Dallas after seeing NorthPark's expansion plans.

    "The Dallas customer continued to shop with us in New York and kept asking us when we were coming back. When Lord & Taylor vacated its space, I immediately asked, 'What are you doing with it?' "

    Mr. Socol got most of the space; Florida furniture chain Robb & Stucky opens in the rest in November.

    By next year, NorthPark aspires to reach $1 billion in annual revenue – an exclusive benchmark in the shopping center business.

    Barneys, too, is reaching toward $1 billion in annual sales.

    The company recently opened in Boston.

    Two more flagship stores open a year from now in Las Vegas and San Francisco.

    Its Barneys Co-op chain, which targets a younger demographic with a much smaller 9,000- to 12,000-square-foot store, could easily expand to 40 or 50 locations, Mr. Socol said, from fewer than a dozen today.

    Austin is getting one next year.

    "We're not as big as Neiman Marcus, but we're expanding," he said.

    While chief executive of the Burdines division of Federated Department Stores, Mr. Socol expanded it over a 13-year period from 17 stores to 45 and increased sales from $475 million to $1.4 billion.

    Barneys was acquired by Jones Apparel Group in 2004 for $397.3 million.

    Today, its parent doesn't break out Barneys' annual sales, but two years ago the number was about $442 million. Neiman Marcus Group's sales last year were $3.8 billion.

    Magnets

    "We welcome them back to Dallas," said Neiman Marcus Group CEO Burt Tansky.

    "By returning to NorthPark, they will help us by creating more traffic to the mall and by strengthening the reputation of NorthPark as the destination for upscale and luxury merchandise in Dallas."

    On Friday, Dallas shoppers will have the two full-line Barneys and Neiman Marcus stores standing less than 100 feet from each other and under the same roof.

    Those two stores are huge magnets for other luxury chains and have helped NorthPark's management to attract several stores to Texas, including Intermix.

    "It's the Dallas shopper that we're all trying to please," said Khajak Keledjian, founder and chief executive of Intermix, a 15-store, New York-based luxury chain.

    "I'm here, in the middle of Texas, because in our Madison Avenue store we were constantly being told by shoppers, 'Y'all should come to Dallas,' " Mr. Keledjian said.

    To most Americans, luxury chains remain a mystery, filled with goods they can't afford. Barneys, for example, sells men's jeans for $185, a leather diaper bag for $495 and a limited-edition cellphone for $6,400.

    But NorthPark has expanded, with two corridors dotted with everything from Lacoste and Ralph Lauren to Michael Kors and Juicy Couture, with Tiffany and many others in between.

    The Dallas Barneys will be one of two stores with Paris' Frédéric Malle's glass and steel, phone-booth-like cylinders filled with oxygen for the purest whiff of a perfume sample.

    Which is which?

    Still, discerning the difference between a Barneys or a Neiman Marcus or an Intermix – or Nordstrom after its move into designer labels – can be confusing.

    In a way, luxury chains reflect their roots, said Allen Questrom, former chief executive both at Barneys and Neiman Marcus and a director at Barney's parent, Jones Apparel.

    "Barneys grew up in New York selling very expensive men's suits at discount prices and then moved up to Madison Avenue and evolved into the women's and upscale contemporary business," he said.

    "Barneys attracted a new generation of sophisticated shoppers who loved wine, the arts and fine restaurants and emerging designers. They feel comfortable wearing jeans anywhere with anything.

    "Neiman Marcus remains the world leader in the luxury industry and with the upscale traditional shopper," Mr. Questrom said.

    "It started out catering to people in a new city with new Texas wealth from cattle and oil, and they wanted to dress their wives in recognizable luxury: Chanel, then Escada, furs – things that were recognizable 200 feet away."

    Neiman Marcus has been building its contemporary lines over the last decade to attract the fashion-forward and younger customer. It also recently opened its second Cusp store, a boutique that is its answer to Barneys Co-op. Cusp stores are in Los Angeles and McLean, Va.

    Mr. Keledjian has been reading books written by the late Stanley Marcus in advance of his store's Dallas debut and calls himself a big fan of the former chairman emeritus of Neiman Marcus.

    "He said there's room for everybody, and we all need to stick to what we're good at – stay focused and true to what you do well."

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