Canary in the mine? Nordstrom takes flight from Anchorage - Must Read Alaska
Connect with:
Monday, December 16, 2019
HomeThe 907Canary in the mine? Nordstrom takes flight from Anchorage

Canary in the mine? Nordstrom takes flight from Anchorage

Andrew Halcro, chief executive officer of the Anchorage Community Development Authority has known about Nordstrom’s impending closure for many months, but wisely kept the bad news to himself while he tried to convince the company to stay in downtown Anchorage.

But even for the immaculate man appointed by Mayor Ethan Berkowitz to develop Anchorage, there was no convincing the executives of the luxury department store: Nordstrom is closing stores in poor markets, and opening them in others. Halcro will have to find another tenant after Nordstrom leaves in September after 44 years.

The chain has about 119 stores, a small footprint compared to national department stores like Macy’s (641) or Dillard’s (292). And the high-end company makes careful moves.

Halcro blamed the Nordstrom departure on a demographic and cultural change in Anchorage and said that “traditional brick-and-mortar stores like Nordstrom have suffered” because of that.

He’s right. Anchorage has changed. Nordstrom had already changed up its merchandise at the Anchorage store to meet the needs of the change. But that wasn’t enough.

What Halcro might have said (but won’t say) was that the demographic and cultural change in Anchorage has been declining during the Berkowitz Administration. Crime is still off the charts in the city many refer to as Los Anchorage. Drug abuse is openly pursued on the streets downtown, bathrooms are unsafe, parking garages are smelly, and an increasingly dangerous “street people” scene has caused shoppers to go elsewhere. Pot stores, like the one that Halcro opened, are the only sign of a thriving business trend. That, plus food trucks.

“We’re “bookending” downtown with vibrant spaces – K Street Eats and The Rooftop. This is just one way we are revitalizing the community,” Halcro’s agency’s website says.

The “bookend” called The Rooftop was a Halcro creation that converted parking spaces at the top of the 5th Avenue Parking Garage, which his agency also owns and runs, into a playpen for millennials — a basketball court in the summer and ice skating rink in the winter. It generates no revenue, and is not widely used, but it replaced downtown parking with a concrete park that is surrounded by jail-yard style fencing.

As for K Street Eats, it’s a food truck pod that has relocated to E Street. It’s seasonal. Tourists don’t really know about it and most Anchorage residents could not tell you where it is. But it’s nice to see young entrepreneurs bringing energy into the downtown scene.

That’s not the same kind of economic magnet as a Nordstrom. No one is going downtown for a food truck and a pick-up game of basketball.

The Nordstrom chain is thriving in other locations, just not Anchorage.

Overall, like other department stores, Nordstrom’s is aware there are storm clouds on the horizon for big real estate footprints in high-rent malls or downtowns. It has to make smart moves.

Last month, Nordstrom Inc. stock fell 10.7 on the news that the first-quarter sales were below expectations.  The company earned $37 million in the quarter, compared with $87 million the year before.

Online sales now make up over 30 percent of the company’s business. Off-price sales at The Rack are also a large part of the company’s portfolio, and it’s four-wall stores now make up just half of over revenue.

Since 2017, it closed two stores in Southern California, one in the D.C. downtown area, and another in Salem, Oregon.

But still, Nordstrom is opening stores in communities that are rising: New York City is where the new flagship store is, and Norwalk, Conn. opens this year. The entire list of Nordstrom store openings are here.

For Anchorage, it’s a symbolic blow. People sometimes would apologize for the dusty, industrial nature of Alaska’s biggest city, but end the sentence by saying, “But at least we have a Nordstrom.”  It meant that a high-end company was banking on the city being a good investment.

While Halcro was building a non-revenue basketball court, a food truck pod, and his own pot store, liberal politicos with long knives chased the Legislature out of the downtown Legislative Information Office. Democrats labeled it the Taj Mahawker, a moniker making fun of former Rep. Mike Hawker, a Republican who led the renovation of the old building, which had been a real eyesore.

No good deed goes unpunished; although the renovation was a great addition to downtown Anchorage during a time when recession was hitting, and while it could have sparked retail and economic growth nearby. The Taj Mahawker name stuck and shamed the Legislature into moving to more modest space in Midtown, where they cannot actually convene a special session.

Then, the Anchorage Community Development Authority swooped in and bought that Taj Mahawker building for $14 million from a bank in Florida that just wanted to get out of its Anchorage investment.

The ACDA inked an agreement to move the Anchorage Police Department’s command center into it.

Now controlled by the ACDA, no liberal called it Taj Mahawker luxury accommodations anymore. The Berkowitz Administration now owns it, essentially. And the police never really moved in. They may have an office there, but they’re still out on Elmore. Police should not locate their headquarters in glass buildings, it seems.

The liberal intelligentsia moved on to other topics, and the municipality is losing millions of dollars in property taxes it could have had, if it had allowed Calista Corp. to buy that building, as it plainly told the Anchorage Assembly it wished to do. Instead, the building is in government hands.

Halcro also has another problem, and it’s right next door to the soon-to-be-vacant Nordstrom: Just last year he announced that the parking lot that serves Nordstrom (and JC Penney and the Fifth Avenue Mall) will need to be torn down, and at the time he thought a combination of residential, retail, and perhaps even a hotel could go on that spot, along with some parking. Before he gets to that project, he’ll need to figure out tenancy for the Nordstrom building.

The Anchorage Community Development Authority is beginning to look like it’s the owner of a few too many vacancies downtown. The ACDA has created food truck pods and basketball courts. But it’s going to have to deliver some big wins soon, before retailers and property owners rush for the exits.

Donations Welcome

Share

Written by

Suzanne Downing had careers in business and journalism before serving as the Director of Faith and Community-based Initiatives for Florida Gov. Jeb Bush and returning to Alaska to serve as speechwriter for Gov. Sean Parnell. Born on the Oregon coast, she moved to Alaska in 1969.

Latest comments

  • Excellent article, Suzanne! Great research! Keep up the great work. Another small donation headed your way;all an ex-working man can afford!

    • Suzanne doesn’t know cow manure from apple butter. Typical mean spirited comments from another hateful conservative with venom in her veins. Anything to criticize liberals. Amazing. Where does all the hate come from?

      • I’ll bet Suzanne would know you from apple butter. The libs generate ample reason for criticism. Where does all the hate come from? From people like you, when anyone disagrees with you.

        • Ben Colder, you certainly have John Connors number! And I certainly agree with you Ben and Suzanne’s brilliant writing!

        • Boom!

      • I can’t tell the difference between Halcro and cow manure.

      • That’s all you got, John Connor? You sound about as educated as a 7th grader on the playground. If you are a true representative of the Democratic Party and Leftist liberals, you are the product of the destruction you sow. You really are a sorry guy, John. Hateful, name-caller, with a mind full of mental illness and a soul of empty darkness. Get psychiatric help…….soon.

      • My guess is that you may have a hard time with that difference. Especially since your comment is manure at its best.
        Suzanne is stating the facts. Mr. Halcro knew this for months, he should have been working on replacement of the space as plan B..now we will have a vacant space on September 14 and a hopefully another tenant will find it appealing for them. (His words in the tv interview)
        Has nothing to do with bashing liberals, has to do with bad management and people who think they’re experts and they are not.

      • The hate comes from you liberals. We hate how you have ruined every big city in our country and now are hell bent on ruining our biggest city.

    • Keep up your great work Suzanne!

  • I just imagine you getting really drunk and reflecting on your abusive childhood before you write these tragic articles.

      • Mann o Mann sounds more like a “girly Mann,” who swishes and sashays around the internet.

      • That’s a really cheap shot at Suzanne, Mr. Mann. You obviously have some child-like issues with intelligent women writers who use their brains and reasoning. Something you obviously lack.

    • Mann O Mann: what is tragic is your reply to a hard working woman that provides information to us that we get no where else. If you disagree, then be a “Mann O Mann” and disagree. What you have done instead is show your ability to be toxic and sick in your imagination. Think rainbows, puppies, and daffodils the next time you try to imagine anything.

    • Do not abuse Suzanne, we need her!

    • The only thing “abusive” here Mann o Mann, would be your nasty and uncalled for comment!

    • Great article!!! Your fact based reporting is really ruffling the (forward off a cliff) liberal progressives. All they have are gutter trash attacks because it’s TRUE Berkowitz has totally failed. Nordstroms is just one more example.

  • Good article! You obviously know how Halcro is. He’s a piece of work.

    • With credit to Clint Eastwood, Andrew Halcro is a legend in his own mind…

  • Agree Larry. Excellent outline of what’s happening downtown. I’m already going through withdrawals with this announcement. Sad for Anchorage. Get your sh*t together Berkowitz et. at. That isn’t a slam on him personally. It happens to be his administration right now and everything is going to hell in a hand basket. But funny that we never seem to hear from you Ethan? Where are you?? Business is business for Nordstrom. I get it. But going downtown sucks. They were the only reason I went other than an rare occasional event at the PAC or dinner. First I heard of b-ball courts and food trucks. Good luck. But nice that Andrew’s making bank on weed. Must be the dope money I saw him spending at the Rack not too long ago. Pretty soon downtown Anchorage is going to look like Ketchikan in January – only colder without the rain.

  • Sad but true , Great story just did not go far enough perhaps , as down town Area started dying slowly after the pipe line in their effort to clean it up. small mom and pop’s gone eateries /deli’s as well. ,Sunshine mall used to be very vitail not so much any more .. Can’t blame them as situation over the years has gotten worse instead of better ,not just current mayors fault its been long time coming crime and homeless lack of any seen response does not help. There really no focal point moneys tight and things change ..

  • I remember when that Dandy of Man Halcro pretended to be a Republican, I guess that’s over as he goes full Libitard. As far as downtown goes, you couldn’t pay me to go down there.

    • I feel the same way. Downtown is absolutely horrible I wouldn’t go there for anything.

  • Several years ago, myself and a committee of Alaskans, traveled to Juneau to plead with State Legislators for a “Project Workforce Agreement”. This agreement would guarantee that Alaskan residents would receive first option at any State labor agreements for work involved, that Alaskans would be first offered job opportunities, providing the Alaskans had the skills needed. Little Ethan refused to meet with us and when we tried to involve him, he simply strutted away with never even a look back. This exposed his “true colors” to me and the committee. Several other State representatives met with us and agreed this was a legitimate proposal. Never the less, the proposal never made it to the legislative floor. Since, little Ethan has ‘moved on’, politically. Now, as mayor of Anchorage, his policies are doing to Anchorage, what Ethan wanted to do to the entire State of Alaska. Open your eyes, Anchorage citizens. Either replace Ethan and cronies or watch/live Anchorage being turned into a mini LA/Portland/San Francisco.

  • Berkowitz and his staff need a change in attire. Put a Carhardtt’s in downtown and another Value Village. That reflects a better image for the “anti-PFD” crowd, like Berkowitz, and shows what Alaskans can afford. [Except for big government Lefties and Democrats who fly down to San Francisco and Seattle on weekend shopping sprees.]

  • Nordstroms is leaving for many reasons…
    Manly Amazon and the fact that Alaska is a “Carhartt State”…even the Governor himself has his favorite jacket on in one photo I have seen.
    Secondly Alaskans are “gear intensive” folks which shows why stores like Cabela’s chose to move here.
    Lastly many Alaskans are shopping at second hand gear shops like The Hoarding Marmot in Anchorage or thrift stores like Value Village or Salvation Army….
    Nordstroms leaving is a sign of the times overall and not a good indicator of how the economy is doing.
    As for Pot shops, well look at the thousands of jobs added throughout the state with the end of Prohibition of Cannabis and the hundreds of Millions in taxes payed to the state each year…
    Conservative voices are mad the industry is working as well as it is and thriving throughout the state.
    This is a multi Billion dollar industry throughout America and not going away anytime soon.

    • Hundreds of millions? I find that hard to believe. Maybe in the entire country combined…

  • You are right….don’t abuse Suzanne. We need someone like her that will tell us all what’s going on. The truth hurts and it is happening. People in charge don’t step up to do something about what is happening in the State of ALASKA.

  • Are there still stores in downtown LosAnchorage? Between scarce (and getting scarcer) parking and street thugs I haven’t even tried shopping there. Turned out to be both convenient and safe in the Wasilla our legislators so fear.

  • I do believe that Nordstrom decision makers missed the mark with Anchorage and created their own demise. They made the assumption, yes I believe it was an assumption and not based on concrete data, that the downsizing of oil company presence meant no one wanted to pay more money for better quality clothing. They began going down hill ten years ago in merchandising, professionalism of sales staff, and well stocked inventory. I believe they lost their ‘compass’ of high quality and rather than forging ahead with a high standard for which there are still plenty of customers, they instead sought to compete on a lower level with the big box type Targets, Walmart’s, H & M, etc. The quality of inventory in the Anchorage store has made a steady downward slide and their knowledge of sizing also has been idiotic as you can find ample racks of size 18 but good luck finding a single 2, 4, or 6. Visit the Bellvue Square, downtown Portland, Clackamas Town Center stores to name a few, and you have the real Nordstrom experience. I have slowly stopped shopping in the Anchorage store in disappointment because of above mentioned. I do shop there when I travel out of state. Lastly, I worked for Nordstrom all through college at both the Salem, OR and Anchorage stores – in the early 80’s. It was an excellent company. They have missed the mark with Alaska shoppers and hence created their own failure here. It has nothing to do with a lack of potential customers. It is a very sad loss and will leave a gap. It was still the store one could find nice evening wear, a well crafted tailored suit, and still some professional clothing. There are no other options in Alaska.

    • I agree with Elizabeth and actually tried to engage the Manager. He wasn’t willing to listen when I told him there were people in AK who would buy the higher quality products. Nordstrom checked out of Anchorage a long time ago.

    • I learned to walk in a retail store; my father ran and later owned small town “dry goods” stores and my first wage job was as a Management Trainee and later Department Manager for JC Penney. I gave up retail as a bad way to make a living, but I was good at it and you can always get a job in retail if you know how to show up and do what you’re told, skills that are largely lost these days. Since you can always get a job in retail my first job on my second day in Alaska in ’74 was at Stallone’s in UC. I moved on to other things because I really needed good union health insurance but I would sign on to work in Nordstrom’s Men’s Clothing and Sportswear during the Holiday season and for sales events because if you knew how to work it you could make really good commission. The managers would stack the floor on you; put $10,000 in sales quotas on the floor on a day projected for $5000. If you weren’t ruthless with your co-workers you worked for the minimum wage. I could write top book, so they were pretty nice to me.

      Even in the late Seventies the Anchorage store was only one cut above a Rack store; only a minority portion of our stock was first line, current inventory; the rest was stuff that didn’t move in other stores and got sent to Alaska. That was especially true during the big promotions like half yearly sales. During The Pipeline Nordy kept a lot of the Northern Commercial karma and sold a lot of Pendleton, Woolrich, and such; they even had some sporting goods. I still have a Buck Folding Hunter knife I bought from Nordstrom’s in the Seventies. After the Pipeline was done, it became a Seattle store and they moved to a lot of private label stuff. As with all US retail, the American brands either disappeared or just became a label on Asian junk. I stopped working there in the early Eighties and pretty much stopped shopping there. I moved to Juneau in ’84 but I was here a couple of times a month. I worked a suit and tie job, but Nordstrom’s became increasingly irrelevant as it became more and more young and gay in menswear. It was a good place to drop in for a silk blouse or scarf for the wife as a guilt gift to bring home and I bought a little jewelry and some shoes there, but the clothing did nothing for me other than some Ralph Lauren, and you could get that for less elsewhere.

      I don’t think they ever really understood the market here, certainly not in menswear. They made the most common and most amateurish mistake you can make in retail; they stocked what they liked, not what the customer liked. With all respect to the poster above, stocking much in women’s sizes 2, 4, and 6 is a good way to go broke in Alaska; you’re going to sell a Helluva lot more 12, 14, and 16. For men who can actually afford a decent suit, and that’s, say anything above about $700, the standard blue, gray, and tan is what you want in every size and style. You put some patterns and different colors in limited sizes on the rack and the clothes horses don’t mind special orders or transfers from other stores. If you’re going to sell “fashion” clothing in Alaska, you have to do it in a specialty store, charge a lot for it, and hope you’re lucky, or sell a lot of cheap crap. Nordstrom’s kinda’ chose the latter but their cheap crap was expensive. People who buy dress clothing in Alaska are pretty conservative because they’re almost all in government or in public contact jobs, so you can’t be garish. Nordstrom’s went for garish.

      Anyway, Nordstrom’s made a lot of merchandising mistakes but the real downfall of Nordstrom’s is the fact that downtown Anchorage has become unfit for human habitation; nobody goes there unless they have to. It’s only a matter of time before downtown Anchorage is like downtown Ketchikan, Juneau, and Skagway; boarded up from October through April. The tourists either don’t have a choice or don’t know any better; nobody who lives here will go there except to answer a subpoena or get a permit or some such.

      • Good comment, Art.

  • I have noticed changes in the store over the years and agree with some of Elizabeth’s comments.
    .
    Steve Stine mentions our Carhartt State and value village ways, but there are still plenty of people in this town that need to clean up and buy decent clothing and Nordstrom helped with that. Steve, check your numbers on the pot game. I think they are off.
    .
    I like to touch my clothes and try them on before purchase. I want to sample the makeup. Try on the shoes and walk around the store to see how they feel. Return things if I have buyers remorse. You can’t do that online. The nearly 100k sq ft hole in downtown will be a tough hole to fill.
    ,
    Downtown Seattle store might be next. If not for a dollar and cents business reason, maybe for a “scents” reason. You have to plug your nose from the smell and step over human feces to get into the place.

  • Thanks Suzanne for your tireless work to keep us up to date in Alaska!

  • The police have moved into the 4th Avenue building. They also have officers out on Elmore. That was always the plan. I know this because my husband is APD, and his office is downtown. I do agree about the big glass windows. The PTB didn’t really think that one through very well.

%d bloggers like this: