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Winnipeg on outlet mall radar

U.S.-based Tanger to open centres across Canada

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Bargain-hunting fashionistas rejoice!

Winnipeg is one of the cities that will be getting a U.S.-style factory outlet mall, according to a spokesman for one of the income trusts that's bringing the retail concept to Canada.

"There's got to be one in Manitoba, and if there's going to be one in Manitoba it's got to be near Winnipeg," Edward Sonshine, president and CEO of Toronto-based RioCan Real Estate Investment Trust, said Tuesday.

Factory outlet malls, with their tantalizing combination of brand-name merchandise (usually prior-season goods) and deeply discounted prices, are huge retail draws in the United States.

North Carolina-based Tanger Factory Outlet Centres is partnering with RioCan to bring its outlet mall concept to Canada and its malls are typically about 350,000 square feet. That's similar in size to the new IKEA store that's scheduled to open in Winnipeg in 2012 or 2013. And because these malls usually feature dozens of brand-name outlets, one local retail leasing specialist said their drawing power is probably similar, as well.

"The (Winnipeg shoppers) will embrace it and it will be very big," said Ken Yee, senior executive vice-president of Cushman and Wakefield's Winnipeg office. "The outlets in the U.S. are always busy."

The closest factory outlet mall to Winnipeg is the Albertville Premium Outlets mall near Minneapolis, Minn., which boasts more than 100 discount retailers and more than 400,000 square feet of retail space. It's long been a favourite of Manitobans visiting that area.

Sonshine said RioCan and Tanger plan to open outlet malls in 10 to 15 Canadian cities over the next five to seven years.

"You won't be the first (to get one)," Sonshine said, adding that will be Toronto and Calgary because RioCan already has building sites in those two cities. After that, the partners will likely target Vancouver, Ottawa, Montreal, Edmonton and then Winnipeg. "So you're probably three or four years away, at least," he said.

Sonshine said the retail tenants that have told Tanger they're interesting in opening factory outlet stores in Canada include Nike, Adidas, J. Crew, Pottery Barn, Polo by Ralph Lauren, Tommy Hilfiger, Lacoste and Kenneth Cole.

"Ninety per cent of them will be brands they (Winnipeg shoppers) will recognize," he said.

Factory outlet stores typically boast prices that are 30 to 40 per cent below retail.

Sonshine said the partners haven't given any thought to where they might want to build their new outlet mall. But Yee had a few ideas.

"They're probably going to need a large chunk of land, so they'll likely end up in the IKEA development," he said, referring to the 1.5-million-square-foot IKEA/Seasons of Tuxedo retail development that's in the site-preparation stage at Kenaston Boulevard and Sterling Lyon Parkway.

"And I wouldn't rule out the (Winnipeg) stadium site, either," he said, noting there are 10.5 hectares of land available there and they could go two storeys high.

A third possibility is the Bishop Grandin Crossing retail/industrial/office development that's in the early stages on a chunk of land that includes the former Manitoba Sugar Beet property in south Fort Garry, Yee said.

While the pending arrival of factory outlet malls is great news for Canadian shoppers, one retail analyst told the Globe and Mail on Monday it spells more trouble for domestic retailers who are already bracing for the arrival of other U.S. retail giants like Target Corp., which recently struck a $1.8-billion deal to acquire up to 200 Zellers stores from Hudson's Bay Co.

"It's going to provide a lot more competition for the likes of the Bay and stores in the traditional enclosed shopping centres," said Wendy Evans, of Evans & Co. Consultants.

Republished from the Winnipeg Free Press print edition January 26, 2011 B5

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