The FOURSOME, an 80 year-old premier clothier in the Twin Cities, and a long-time tenant in the Wayzata Bay Center, wanted to look at its business focus for the future and consider the need for new space. A developer had purchased the shopping center site and planned to demolish the existing buildings to make way for a new mixed-use project involving significant retail space, a hotel and market rate and senior housing. The FOURSOME was very much a part of the developer’s plans, and Bob Johnston of Paramount was asked to assist The FOURSOME in its negotiations with the developer.
The assignment eventually involved five separate assignments that were unanticipated at the time the initial assignment commenced.
The FOURSOME operated five different retail operations at the Wayzata Bay Center . . . men’s clothing, men’s big ‘n tall clothing, women’s clothing, children’s clothing, and men’s/women’s shoes. Over the course of several months, Paramount facilitated various meetings with consultant groups to determine what operations should remain based on current and future market demand and financial performance. In the end, three of the operations were shuttered and two, men’s clothing (including big ‘n tall) and men’s/women’s shoes, were retained.
Paramount then developed an architectural RFP, developed a comparative matrix to evaluate the proposals and set up interviews with the respondents. The FOURSOME selected an architect, and the programming function commenced to determine The FOURSOME’s future space requirements.
Paramount then commenced negotiation of the business terms for a FOURSOME lease in the new development. After several months of discussion, a contractual agreement was executed, including agreement as to the delivery condition of the vanilla shell, the Landlord’s construction contribution and lease rate, escalations, etc.
Months following execution of what The FOURSOME thought to be a long-term commitment in the new development, the developer came back to Paramount saying that it wanted to renegotiate the business terms of the deal. Since the Landlord’s rates and terms differed significantly from Paramount’s recommendation, the deal was rejected. As a result, Paramount recommended The FOURSOME request a buyout. Consequently, based on the Paramount recommended terms and price, a buyout agreement was finalized.
As a result of the termination and buy-out, Paramount started the process all over again, attempting to find a suitable location for The FOURSOME. Since the operation had been located in Wayzata for so many years, Wayzata was the preferred location. However, after a lengthy search and discussions with area landlords, The FOURSOME determined that the rental rates were simply too high, and Paramount commenced a search elsewhere.
At that time, Inland Real Estate, who controlled a site near the intersection of Hwy 55/Vicksburg Lane in Plymouth, was considering the development of a small retail strip center on the site. After several discussions with the developer, Paramount negotiated a long-term lease . . . and, because those discussions took place early in the development process, The FOURSOME was able to make significant design changes to the exterior and interior of the building to more closely fit The FOURSOME’s operation.
Paramount negotiated a new architectural contract, recommended the general contractor and negotiated its contract; and coordinated and managed the design, pricing, shop drawings and site construction. The FOURSOME was able to use buy-out funds to fund the new construction. After almost three years of discussion and negotiation, everyone was glad the journey was over. The space is impressive, The FOURSOME is pleased, and its business continues to grow and prosper in the new location.