Perched on the edge of the Everglades, nearly an hour’s drive from downtown Miami, Sawgrass Mills mall is an unlikely place to emerge as one of the Sunshine State’s top tourist attractions. The giant outlet mall has no roller coasters nor marine animal shows, no beach nor clubs open until dawn.
But as Sawgrass approaches its 30th birthday next year, the mall is often called South Florida’s largest tourist draw, outpaced only by Orlando theme parks in visitor numbers in the state. More than 30 million people now visit yearly, at least 60 percent of them tourists, according to mall managers. Thousands of travelers come by bus every week, some on excursions before or after cruises. Indeed, Sawgrass depends so heavily on visitors from Latin America and other world regions, it even takes marketing cues from Disney, recently adding incentives for Floridians during the usually slow autumn season.
“They market and manage themselves as a tourist attraction, not a shopping mall,” says longtime Miami area resident and retail analyst Cynthia R. Cohen, founder and chief strategist at Impact 2040 consulting firm, explaining Sawgrass’ continuing success. For instance, the mall focuses on logistics to handle scores of tour buses: bathrooms for bus drivers, parking for buses and areas for passenger pickup. “Traditional malls don’t think that way and don’t have the space to accommodate buses like that. For Sawgrass, it’s a Disney-esque kind of business.”
Sawgrass opened in 1990 as an outlet mall, designed in the shape of an alligator, with about 100 stores and two food courts. But it has been expanding, renovating and reinventing itself ever since — the way that tourist attractions do to stay current and stand out in a competitive market, analysts say.
Today, Sawgrass hosts more than 360 shops, 100-plus kiosks, 15 sit-down restaurants, a movie theater complex and other offerings spread across 2.4 million square feet of retail space. That makes it the second-largest mall in South Florida after Aventura and among the 15 biggest nationwide. In its discount niche, it calls itself “the largest outlet and value-retail shopping destination in the United States.”
Sawgrass now offers not only outlets, which traditionally sell last season’s merchandise, but also “company stores,” which design goods exclusively for those outlets. It features at least 70 outlets exclusive to South Florida, including luxury purveyors Gucci, Prada and Tory Burch.
Key to mall attractions: the luxury Colonnade section. Launched in 2006, it now has around 60 retailers, from Burberry to Versace. Even after two expansions, it has no vacancies and a waiting list, managers say.
“Luxury outlets are a brilliant idea,” says Paula Rosenblum, managing partner of Miami-based RSR Research, a consultancy focused on the impact of technology on the retail industry. “It’s a retail segment that’s growing, partly for the aspirational shopper.”
Visitors say they’re lured to Sawgrass for its huge selection and prices typically cheaper than other U.S. malls. Some South Americans come periodically to stock up on clothes, shoes and household goods that are either not available in their country or might cost double or more because of import duties and limited supply. On a recent Friday, Juan Gallardo, 37, a computer store owner from Venezuela, was buying a stroller and babywear hard to find in his cash-short nation. Fredy Trujillo, 44, a flight attendant from Ecuador, carried bags from Columbia Sportswear and was buying children’s toys. “I come here every time my flight schedule allows” in South Florida, said Trujillo, wheeling a suitcase by his side.
“Tourists think they’re getting a deal on top of a deal at Sawgrass,” explained retail analyst Rosenblum.
Now, the mega-mall is embarking on its largest renovation-expansion yet. It’s updating its original enclosed area to strengthen Wi-Fi, add charging stations and modernize food courts, floors and lights, among other changes. The Regal Sawgrass & IMAX Theater is revamping to offer luxury seating and new food options. For travelers, a new hotel is set to debut late next year: a 174-room AC Marriott, complete with a rooftop bar. The hotel will serve not only shoppers but also visitors to the adjacent corporate park and to the BB&T Center that hosts concerts — visitors likely to dine at mall restaurants.
Reaching out to tour companies, cruise lines and Hard Rock Hotel
Of course, Sawgrass doesn’t draw millions of tourists automatically. It has long employed a full-time tourism chief working with travel companies, featuring the mall on tours from South America, drawing 15-year-olds coming in birthday groups. Sawgrass also hires staff who speak Portuguese, Spanish and other languages for its guest services desks. And it collaborates on ads and other marketing outreach with the Greater Fort Lauderdale Convention and Visitors Bureau and other groups.
More recently, Sawgrass has been partnering with cruise companies including Carnival and Royal Caribbean to promote excursions to the mall, usually before and after cruise trips. That relationship has become so solid that when a recent Air and Sea show delayed cruise departures, one cruise line sent passengers to Sawgrass to ease the wait, said David Gott, the mall’s general manager since 2016.
Next up in its tourism push: closer ties with the Seminole Hard Rock Hotel & Casino, which is building a 638-room guitar-shaped hotel and adjacent 168-room tower about a 15-minute drive from the mall. Sawgrass has started a shuttle to the hotel on weekends and plans to increase shuttle service once the guitar hotel opens, in time for the Super Bowl in nearby Hard Rock Stadium in 2020.
“We’re always trying to grow our outreach to tourists,” Gott told the Miami Herald. “We feel they’re kind of an unlimited resource South Florida has, and it’s just a matter of finding them where they are and letting them know we are here.”
Competition rising from other malls, the Internet
To be sure, Sawgrass faces competition from other malls and the Internet for tourists and locals alike.
Perhaps its most direct rival is Dolphin Mall near Miami International Airport, which also gets a steady stream of overseas visitors and hosts some discounters. But Sawgrass beckons as more of a destination, a place where folks come to spend the day, not fit in shopping between other city activities, said retail specialist Cohen. Sawgrass is nearly twice Dolphin’s size — roughly 1 million square feet bigger — and has dozens of outlets not offered at Dolphin, such as Jimmy Choo.
“Unless you live close by, Sawgrass is not a “Walk in and get a couple of things” place. You go in and get this for Mom, this for Dad, the kids want to do this, and we’ll stay for dinner,” said Cohen of the mall’s miles of retail space. “There are South Americans who come regularly and meet maybe 70-80 percent of their family’s shopping needs during their visits to Sawgrass. They literally come up with a list for the entire family and close friends, and they’re here to check off boxes.”
The Internet has hit some U.S. shopping centers hard, but large, well-run malls with varied offerings and those with strong tourist clientele have not felt the brunt. Simon Property Group, the publicly traded real estate investment trust (REIT) that owns and run Sawgrass and ranks among the world’s largest mall companies, keeps showing strong profits: $2.44 billion in net income on $5.65 billion in revenue last year. Most of its revenue came from rent paid by retail tenants.
“What a mall generally offers,” says Sawgrass general manager Gott, “is an experience. No man on earth goes home and says, ‘You know what honey, let’s go to the Internet this weekend,’ because there’s nothing social about it. It’s not an activity. And there is a large segment of the population who still prefer to try on clothes, who still prefer to decide if they don’t like it and don’t want to be sending stuff back. We’ve seen consistent sales growth all through this.”
Indeed, a 2018 research report by Boenning and Scattergood ranked Sawgrass No. 2 of the 20 most valuable REIT-owned malls in the United States, trailing only Ala Moana Center in Hawaii. It estimated Sawgrass’ sales per square foot at $1,149 and its asset value at $4.1 billion. It also listed five malls owned by Simon Property among the 10 most valuable in the United States.
An engine for business beyond retail in Sunrise
Lou Sandora, economic development director for Sunrise, can attest to the mall’s strength. When he visits Latin America to recruit business and gets asked where his city is, he often replies: “Do you know Sawgrass Mills Mall? That’s where,” he says. “It’s better than Google maps, especially in South and Central America, where everyone in business circles knows Sawgrass.”
Sandora says the mall now serves as a magnet to draw a broad array of other businesses to Sunrise. For example, employers are lured to the city’s corporate park, partly because they figure staff can use the adjacent mall for lunch or dinner after work. The park now employs about 30,000 people, ranking among South Florida’s largest and including American Express’ Latin American headquarters, he said.
What’s more, the massive $1.5 billion, residential and mixed-use Metropica development underway on the mall’s edge promotes Sawgrass Mills as an extension of its own amenities. Metropica’s top brass even features a former executive from Sawgrass Mills and the Simon group: “It’s hard to quantify this, but besides being a great attraction in itself, the mall is an anchor for other development in the city.”
City coffers clearly benefit. Sawgrass is the city’s biggest contributor of property taxes and provides about 11 percent of its ad valorem taxes, which include property contributions, officials say.
Challenges for the future: American Dream Mall?
Still, Sawgrass has its challenges. Gott said he battles the perception among many locals that parking is a day-to-day problem outside of holiday rushes. Lots of South Floridians aren’t aware the mall opened a 1,700-space garage in 2016 that even has airport-style lighting to show available spaces, he said.
Then, there’s the proposal by a Canadian group to build the country’s largest shopping complex in Miami-Dade County: the $4 billion American Dream Mall to be located off Florida’s Turnpike and feature an indoor ski slope and theme park. Retail specialist Cohen says how much American Dream might affect Sawgrass depends partly on “how strong Sawgrass’ contacts are with the tour companies.”
Brenda Zook, who runs Bloomingdale’s outlet stores in South Florida, is upbeat on the mall’s future. In seven years working in the Colonnade section, she has seen steady expansions and upgrades — from the opening of the parking garage to more elite shops, the addition of music and fans in outdoor areas and even a Gator Garden filled with sculptures of alligators that’s now an Instagram-able favorite.
“Beyond the stores, Sawgrass has become an experience. There are people that come for the restaurants and to walk around and don’t even shop,” Zook said. “That’s how it’s going to evolve.”
Analyst Cohen also cites the upcoming Marriott as proof that Sawgrass keeps evolving as a destination. “The hotel is going to bring in more tourists to spend two days, instead of one,” she said. “Sawgrass can’t rest on their laurels, and they aren’t. They keep reinventing themselves.”
SAWGRASS MILLS MALL
Features: Billed as “the largest outlet and value-retail shopping destination in the United States,” Sawgrass Mills has more than 360 stores, 100-plus kiosks, 15 sit-down restaurants, two food courts, a movie theater complex and other offerings. It spans more than 2.4 million square feet. At least 70 outlets are exclusive to South Florida including Gucci, Prada and Versace. Retailers include such luxury brands as Armani and Mont Blanc, U.S. staples such as Nike, Tommy Hilfiger and Calvin Klein, U.S. chains such as Century 21, and restaurants such as Seasons 52.
Visitors/shoppers: Estimated to top 30 million per year, with more than 60 percent tourists and Brazilians the largest international group. The mall is widely considered the No. 1 visitor destination in South Florida. Shoppers stay on average more than four hours, far longer than in most U.S. malls. The end-of-the-year holiday season is the busiest time.
Owner and manager: Simon Property Group, a real-estate investment trust listed on the New York Stock Exchange as SPG and an S&P 100 company. Simon is the largest shopping mall operator in the U.S. and one of the world’s largest companies in shopping, dining, entertainment and mixed-used centers. In South Florida, it owns a stake in Aventura Mall and also owns and runs Town Center in Boca Raton. In 2018, SPG had $5.65 billion in consolidated revenue and $2.44 billion in net income. The company was started about 60 years ago by three brothers from Bronx, New York, as Melvin Simon and Associates.
Management: Leading the mall is David Gott, 51, general manager since 2016 and with SPG for 21 years. He’s from greater Chicago and managed at least eight malls. He previously worked with Nordstrom, and in South Florida, with Wolverine. Among his priorities at Sawgrass: cleanliness, safety and comfortable restrooms.
History: The mall opened about a mile from the Everglades in 1990, designed in the shape of an alligator, with about 100 stores. It was expanded and renovated numerous times, launching its luxury Colonnade section in 2006 and adding a 1,700-space garage in 2016. SPG bought the mall in 2007 as part of its larger Mills acquisition.
Underway: Renovation of the original enclosed area to feature more natural light, brighter LED lighting, tile floors, updates of food courts, upgrade of Wi-Fi and more charging stations for electronics. Also, adding a 174-room AC Marriott hotel slated to open in late 2020.
Source: Miami Herald