New, smaller Target to open near UT campus


Highlights

Store will be one of Target’s new prototypes

Retailer targets bigger sales, with smaller stores

In what’s being called a “gamechanger” for the Drag near the University of Texas campus, Target confirmed Thursday that it will open a smaller version of its department store next to the campus next year.

The 22,000-square-foot store will be at West 21st and Guadalupe streets in Dobie Twenty21, a 27-story residential and retail tower. The store is scheduled to open in July, Target said in a news release.

The UT store will be much smaller than Target’s typical stores, which are about 145,000 square feet on average, according to the company. Target said it will sell an assortment of groceries, dorm and apartment essentials, technology products and accessories, men’s and women’s clothing, and health and beauty items. Parking will be available in the garage next to the Dobie Twenty21 building.

“Growth on college campuses and in urban markets is a priority for Target,” Target senior vice president Mark Schindele said in a written statement. “We’re able to serve more guests by adding flexible-format stores near top universities across the country, including the quick-trip shopping experience we’ll bring to the University of Texas campus. We’re thrilled to open our first flexible-format store in Austin and to join the Longhorn community.”

Minneapolis-based Target said it does not share the costs or financial details of its stores. The company said it does not yet have a projected employee headcount for the UT store, its first smaller-footprint store in Texas.

Target said that in the coming year it plans to also open smaller-format stores near the University of Cincinnati, University of North Carolina, University of Southern California and the University of Florida, among other campuses.

Target executives say shoppers have responded well to having the smaller, customized stores they are locating in urban and densely populated suburban areas — including the Tribeca neighborhood in Manhattan — as well as near college campuses. Target currently has 31 of what it calls “flexible-format” stores, and to date has announced plans for 26 smaller format stores in 2017, 2018 and 2019. Companywide, Target has about 1,800 stores.

The Dobie Twenty21 development consists of a 400-unit apartment tower, plus 60,000 square feet of retail space and a parking garage. It was purchased in July 2015 by California-based Fowler Property Acquisitions.

Formerly known as Dobie Mall, the center – once home to an arthouse movie theater – has been undergoing renovations to both its apartments and retail space.

In a written statement, Ryan Rubenkoenig, executive vice president of Red Tail Acquisitions LLC, a sister company of Fowler, said that in coming months “we’ll announce additional retail offerings to Dobie Twenty21 that will be part of the substantial renovations included in the two retail levels of Dobie Twenty21, in addition to the transformation of the 25-story dorm tower.”

Charlie Quisenberry, senior vice president with Edge Realty Partners in Austin, represented Fowler in Target’s long-term lease transaction. Quisenberry said the new store is “truly a gamechanger for along the Drag,” which is what many UT students and Austinites call the stretch of Guadalupe Street along the UT campus.

“It’s going to be a huge benefit to the students at UT,” Quisenberry said. “It’s going to be a terrific draw and really anchor the south end of the Drag. We’re very excited about it.”

With Target announced, “we’re going to be re-merchandising and re-leasing some space,” Quisenberry said. “This was a big catalyst to get the center going again.”

He said about 15,000 to 20,000 square feet of the total 60,000 square feet of retail and food court space remain to be leased.

Quisenberry said that although Fowler’s core business is in the multifamily arena, “they saw a real opportunity with the mall component.”

“You don’t have many opportunities (along Guadalupe), real estate-wise, to get a sizable space, and we were able to relocate a couple of tenants and put the real estate together to do this Target.”

Target’s smaller footprint is an effort to gain a competitive edge at a time when shopping centers are struggling and e-commerce giant Amazon.com rules online sales. Target has seen its sales slide — its second-quarter earnings fell 9.7 percent to $680 million — but this month reported better-than-expected third-quarter results.



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