As Nordstrom prepares to close at the end of the month, the opening of high-performance apparel and equipment brand Arc’teryx in the Rideau Centre is the sort of retailer the mall needs, says one market watcher.
Vancouver-based Arc’teryx, known for apparel and equipment for snow sports, climbing, hiking and mountain running, opened a 2,964-square-foot location in the Rideau Centre Friday, its first branded store in Ottawa.
Ian Lee, associate professor at the Sprott School of Business, said the choice to set up shop in the Rideau Centre is likely a strategic one, for both the retailer and Cadillac Fairview, the owner of the mall.
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“When you lose a tenant like Nordstrom, it’s not just the rent or the revenue that you lose,” Lee said. “Rideau Centre is still a prestige shopping centre, but when you lose Nordstrom, it potentially presents the perception that the mall is declining and they don’t want that.
“They have to mitigate any conception that the Rideau Centre as a destination for shopping is declining and fill it up with more prestige,” he continued. “Not Dollarama. You have to attract higher-income people with more money to spend.”
Although Westboro is known as a go-to hotspot for active and athletic wear, with stores like MEC, Lululemon and Fjallraven, Lee said a downtown store is a “good decision” by Arc’teryx that will likely target young, active, urban professionals living in the downtown core.
“One would think … Westboro would be ideal, but I have long believed and taught every year in class that companies are rational,” he said. “They look at evidence and data and crunch their numbers and they don’t make these decisions flippantly. I’m sure (Arc’teryx) did their due diligence.”
While also high-quality and pricey, Arc’teryx serves a different market than Nordstrom, said Lee, and will likely see more success. While Nordstrom sold clothing, an area where there is “lots of competition,” he said, Arc’teryx targets more active, athletic, adventurous buyers.
“They’re in a different space. They’re upper-income, but a different clientele than Nordstrom,” he said. “My sense is it’s younger professionals with good incomes who are very active and there are lots of them living downtown in those high-rise condos.”
When Nordstrom announced its closure in March, Lee told OBJ that Nordstrom was “destined to fail” in Ottawa and that its closure would pave the way for the transformation of the Rideau Centre and, in turn, downtown Ottawa.
According to Megan Cheesbrough, vice-president of North America retail with Arc’teryx, the opening of the brand’s first Ottawa storefront is the next step in “expanding our retail footprint into the Ottawa community” and “an incredibly exciting moment for the brand.”
“Through a period of strong growth across Canada, we have seen increasing interest from the Ottawa outdoor community.
“Opening our first store in Ottawa will give Arc’teryx a launch pad to foster connections, establish partnerships with local outdoor organizations, and build community in a city with a deep love for the outdoors,” she said in a news release.
Arc’teryx products are sold in 2,400 retail locations worldwide, including more than 160 branded stores. Aside from Ottawa, the closest branded stores are in Montreal and Toronto.
Stan Krawitz, a principal at Avison Young’s Toronto office who closely follows the sector, recently told OBJ the Rideau Centre of the future could include services like spas, wellness centres, entertainment complexes and even sporting amenities such as a 3D golf simulator.
Nordstrom is expected to vacate its six Nordstrom and seven Nordstrom Rack locations in Canada by the end of June, including its two-level, 157,000-square-foot space at the south end of the Rideau Centre. Mall owner Cadillac Fairview has not disclosed its plans for the soon-to-be-empty piece of prime retail real estate.
Imaginaire, a Quebec-based hobby store chain, is set to open its experience-based, two-level Rideau Centre storefront, its first Ontario location, in the fall.
