November 2006

Kohl's expected to land in South Sound

No announcement yet, but company has plans on file with city

Jim Szymanski
The Olympian

LACEY — Sandy Hyde of Aberdeen wonders about the television ads she has been seeing for Kohl’s department stores.

The Midwestern chain has opened five stores in other Washington communities, but there is none yet in South Sound.

“I’ve been seeing the ads and wondering, ‘Where are they?,’ ” Hyde said last week as she shopped at Target in Lacey’s South Sound Center.

Before the end of this year, Hyde will have her answer.

South Sound Center’s former Mervyns store is being transformed into South Sound’s first Kohl’s, and bulldozers have spent the past several days gutting the interior.

For the record, a Kohl’s spokeswoman will not divulge the company’s plans for South Sound stores.

“There is a store opening in Burlington on March 8, however, we have not yet announced any plans to open a new store in the Lacey community at this time,” Kohl’s spokeswoman Courtney Rogaczewski wrote in an e-mail to The Olympian last week.

The company’s plans for Lacey are in pages of blueprints on file in Lacey City Hall.

They show a 122,000-square-foot, two-story store that Sierra Construction Co. of Woodinville has until July to make ready for Kohl’s to install displays in and stock.

“They’re going to take three to four months to get the store ready,” said Eric Olson, Sierra’s project manager. “It’s going to be early October before the store is ready to open.”

Remodeling plans call for a Kohl’s that may feel larger to shoppers than Mervyns, which used up more square footage for behind-the-scenes storage space, said Wade Duffy, a Lacey building official.

Construction plans also call for an escalator.

“It’s a 40-year-old building that’s getting a complete facelift,” Duffy said. “It will be a substantial change.”

Retail industry accounts conclude that South Sound will be getting a store with prices set higher than Wal-Mart’s levels and lower than those at Macy’s. Its corporate slogan is “Expect Great Things.”

Unlike JCPenney, a direct competitor, Kohl’s sells branded label merchandise, not private-label merchandise. Kohl’s stores also generally are not in malls but in strip centers at high-­traffic locations, said Seattle retail strategists Pat Johnson and Dick Outcalt.

“Lacey is a very good fit for them,” Johnson said of Kohl’s. South Sound Center is convenient because it’s close to Interstate 5 and the store can draw customers from the nearby Olympic peninsula, she said.

“They (Kohl’s) only go to the best intersections; they are a destination,” Outcalt said.

The store also aims to capture time-starved young moms who prefer to park near a store without lingering as long as they might in a larger mall, Outcalt said.

“Kohl’s is really focused on the working mom who drives up and gets what she wants quickly,” Johnson said.

The Menomonee Falls, Wis., company’s annual report reflects a booming enterprise.

Net sales increased an average of 17 percent per year from 2000 to 2005, from $6.2 billion to $13.4 billion for the period. Net income over that span grew nearly 20 percent per year, from $343 million in 2000 to $842 million in 2005.

Kohl’s finished last year with 817 stores and plans to operate 1,232 in the U.S. by 2010, according to its annual report.

Kohl’s lines of merchandise are similar to Mervyns and include women’s and men’s clothing, luggage, bedding, toys, maternity supplies, kitchen items and jewelry.

The company got to Lacey by occupying a vacancy left when California-based Mervyns decided to close its Washington and Oregon stores. That move eliminated 221 full-time and 659 part-time jobs in Washington.

Mervyns’ other South Sound location was as Westfield Capital mall in west Olympia. Management there has not announced a new tenant to take the place of the vacant Mervyns.

“We are talking to a few people, but at this point, there is nothing set in stone,” said Kristine Lleva, assistant general manager of Westfield Capital. She declined to predict when the mall’s owners might announce a successor to Mervyns.

South Sound Center shoppers, meanwhile, have at least a vague notion that Kohl’s will become a new option.

“I know they’re going to be here, but I don’t know much about them,” said Latonya Conner, 30, of Lacey. Conner said she would try shopping at Kohl’s.

Hyde, 40, said she, too, will shop at Kohl’s when she visits her children who live in the Olympia area.

“I’m always looking for a good place to shop where I can find a bargain,” she said.

Jim Szymanski is business editor of The Olympian. He can be reached at 360-357-0748 or jszymanski@theolympian.com.