Fashion Island, Its Face Lift Done, Expects Big Sales

For years, Newport Center Fashion Island was the butt of retail industry jokes that its location--overlooking the Pacific Ocean--would have to appeal to Flipper and other marine life before much could be done to boost sales.

But beginning this week, the dolphin wisecracks may be a thing of the past.

The 22-year-old mall Monday began a weeklong “Grand Reopening� to celebrate its recently completed $100-million renovation.

This renovation is more than just a major face lift. It represents a redirection for the shopping center, as the Irvine Co., its owner, implements an ambitious plan to broaden Fashion Island’s appeal.

If the strategy succeeds, Fashion Island will again shimmer among the Orange County sea of mega-malls. Irvine Co. officials predict that sales, which have been flat for the last three years, will increase by at least 25% from about $200 million to $250 million within 12 months, and by as much as 75% to about $350 million within five years.

There also is talk within the company that the mall’s new complexion--made up like a Mediterranean village and including expanded dining and entertainment areas--could fit into the design of the long-promised Irvine Spectrum retail development.

By and large, industry experts agree that Fashion Island is on the right track in its new campaign in the highly competitive battle for retail dollars. Real estate consultant Alfred Gobar of Alfred Gobar & Associates of Brea, said that although sales at the mall may not increase as much as projected, the effort to broaden its customer base is a smart move.

“They’ve been focused on a narrow strata of customers,� he said.

The remodeling, the third and final stage of an upgrading plan that began five years ago--adds 70,000 square feet of retail space for 60 new stores and a second food court. The center has also added a seven-screen movie theater and 1,300-car parking deck.

The additions total 100,000 square feet, bringing Fashion Island’s gross leaseable space to 1.2 million square feet. It has five anchor stores and about 200 other shops and service businesses.

With its view of the ocean and of the Balboa peninsula, Fashion Island has long been one of Orange County’s most glamorous malls. The idea is that with a bigger and broader selection of merchandise and prices, and with more eateries

and entertainment facilities, Fashion Island will appeal to more people, bringing it out from under the shadow cast by arch rival South Coast Plaza in Costa Mesa. “There has been a conscious lowering of price points to appeal to the customer who perceived us as an expensive shopping center,� said Barbara Roppolo, director of operations for the Irvine Retail Properties Co.

That has meant bringing aboard more moderately priced retailers such as Sun Diego, Wet Seal, Units, Inner City and Au Coton--stores whose merchandise is not only less expensive, but also aimed at a younger customer.

The change in direction should help Fashion Island in the short and in the long run, said Jim Charter, general manager of Brea Mall in Brea. After all, “the younger-generation shopper who starts out at Wet Seal will work up to Amen Wardy.� Wet Seal offers moderately priced women’s clothing; Amen Wardy offers pricey women’s designer apparel.

Fashion Island consciously set out to transform itself from a classic dumbbell-shaped mall--that is, large department stores connected by rows of smaller shops--into a mall that combines the look of European shopping streets and a community gathering place.

The idea, Roppolo said, is to make shopping trips more interesting, to have customers “wandering the streets--the way people do when they visit shops in Europe or downtown in large cities.�

At Fashion Island, the anchor stores are scattered around village plazas connected by red brick walkways lined with towering palms under metal-roof arcades. The idea was to retain the mall’s outdoor ambience while overcoming one of its longtime obstacles--the rainy season.

Restaurant space has increased about threefold, with eateries ranging from cookie stores to the very posh Five Feet Too and the Rex, opening next year. The mall now has 37 dining spots, contrasted with 16 two years ago.

If its new identity is a hit, Roppolo predicts that 1990 sales at Fashion island will hit “a conservative $250 million�--up from $200 million this year.

The State Board of Equalization estimates the mall’s taxable sales at $173 million for 1988, for 1987, and for 1986, but its figures do not include revenue from service shops or the Farmers Market at Atrium Court, which the mall counts.

By state figures, Fashion Island is fifth among Orange County malls in 1988 sales, well behind South Coast Plaza, which led the county with $624 million. South Coast has eight anchor stores, nearly 300 specialty stores and a gross leasable area totaling 2.7 million square feet.

In some ways, industry observers say, Fashion Island, which opened in 1967, was handicapped from the start.

In planning Newport Center, the Irvine Co. anticipated that a new freeway then planned for the coast would bring traffic to its doormat, providing customers easy access. But the highway plans met vigorous opposition from coastal residents, and state highway officials ultimately abandoned the idea.

In part to overcome its access problem, the mall in the mid ‘80s began a series of renovations, among them turning what had been a J.C. Penney store into the three-level, 150,000-square-foot Atrium Court. Next, the area near Neiman Marcus was reconfigured so as to allow more stores in the same number of square feet.

Now, with the remodeling complete, industry observers are eager to see whether the Irvine Co. will achieve the ambitious results it has projected.

“I wouldn’t expect sales to go up more than 20%� in the first year, said Gobar, the real estate consultant. “The competition is already in place, and most of it is pretty strong. I don’t know where the extra bodies would come from.�

John A. Fransen of Fransen & Co., a Santa Monica consulting firm for the retail and development business, is more optimistic. “I think they’re right on target now,� Fransen said. “By giving Fashion Island a broader appeal, they’re going to increase the number� of customers.