New tenants breathe life into Dalton mall

photo Danielle Carroll, left, and Cody Wade walk past stores Monday at the Market Street Shops of Dalton. Carroll and Wade came to the shopping area so Carroll could find new sunglasses. Staff Photo by Allison Carter/Chattanooga Times Free Press

NEW TENANTS* Harley-Davidson* Dollar Tree* Tuesday Morning* Tony's Italian Restaurant and Pizza* Candy Land Treats

DALTON, Ga. - When Tom French came onboard at what was Dalton Outlet Shops, business was abysmal.

The occupancy rate had fallen to 50 percent after the loss of the shopping center's anchor tenant, WestPoint Stevens. The parking lot never was full.

Other outlet malls in Calhoun, Ga., sucked in Atlanta customers, and Chattanoogans to the north made do with the shopping centers there.

These factors, combined with the major 2009 recession and a shrinking local market, left the outlet mall in bad shape.

The outlet mall had been purchased in 2007 by Jacobs Real Estate Advisors, a New York firm that bet on the then-growing Dalton market.

There was no way they could have known the odds of a recession waiting just around the corner.

"A lot of retail tenants had done aggressive expansion right before the recession, at which point they all started doing corporate restructuring," he said.

French, the property director for the renamed Market Street Shops of Dalton, decided to win back tenants and customers by any means necessary. It's not possible to have one without the other, so he took a two-pronged approach.

"We knew national tenants weren't expanding, so we looked at what was in Chattanooga and Calhoun and targeted those tenants that weren't in this market," he said.

He put about $1 million into the property, fixing roofs and leaks, and worked to secure an anchor store for the largest space, a 25,000-square-foot big box.

In recent months, his big push has paid off.

He's scored five new tenants, and new tenants bring in new cars filled with new customers.

Harley-Davidson bought one of the bigger spaces, providing Market Street Shops with a large cash infusion. Dollar Tree, Tuesday Morning, Candy Land Treats and Tony's Italian Restaurant and Pizza have signed lease agreements.

Now 80 percent full, French has only 33,000 square feet to fill out of 180,850 total, he said.

Sales per square foot have stabilized, he said, but the store isn't out of the woods yet.

Unstable gas prices have eaten up the balance on many shoppers' credit cards, and they've begun to change their habits.

"Shoppers buy less frequently now, but they buy more in one visit," he said.

The lack of a tax-free weekend for back-to-school supplies in Georgia sent some shoppers to Tennessee, which also kept sales from rising.

The vagaries of the retail world make predicting long-term sales difficult, but by no means impossible.

Sholom Jacobs, owner of Jacobs Real Estate Advisors, owns property all over the United States.

He sees the light at the end of the tunnel. After years of reaching out to tenants and customers through every means necessary, it might finally be his turn to sit back and let the calls come in.

"I think people are definitely going to start coming to us now, the smaller tenants are going to want to be around here," he said.

Jacobs still is looking for another restaurant, a toy store and a book store to help add variety to the mall's offerings. But he doesn't plan to change French's methods,.

"We'll keep doing all the things that have worked so far," Jacobs said. "Dalton is back."

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