Hillsboro Outlet Mall sold to Dallas company for redevelopment

The Hillsboro outlet opened to much fanfare in 1989 as one of the first discount stores in Texas.

Large retailers, not wanting to compete with themselves, have chosen to sell off-price products in collaborative environments away from their main stores. These had impressive names and advertised discounts ranging from 35% to 65%. Fans traveled north and south along Interstate 35 to shop at GAP, Levi's, Hugger, Nike, Eddie Bauer, Carter's, Reebok, Sunglass Hut, Aeropostal and more.

These stores operated in parallel. Shoppers could easily spend the day wandering from store to store, running out of cash and credit cards. The Hillsboro outlet was so popular that it expanded twice in the 1990s. It became a tourist attraction and a Buc-ee's without beavers. It became a source of transportation and income for the small town, known primarily for its historic courthouse, cellblock museum, and antique shops.

“I remember driving around this huge place in its heyday looking for a parking space,” said City Manager Megan, a Hillsboro native who returned here in 2021 after serving as director of City Center Waco. Henderson looks back.

Her eyes scanned the acres of asphalt and she settled on the fact that the only survivor, Bath and Body Works, was doing well, Henderson said.

Retail industry trends have sent Hillsboro's outlet malls into a death march. Once a thriving space with more than 100 stores, his tenant count has dwindled to double digits, then less than five, and now includes Bath & Body Works and a nail styling salon. Retailers have realized that off-price products sold in neighborhoods can complement retail stores. There was no need for a far-flung location.

Outlets began popping up throughout the Dallas-Fort Worth metroplex, including Grapevine Mills in 1997, Allen Premium Outlets in 2000, and Grand Prairie Premium Outlets in 2012. His Hillsboro outlet, an hour south of the Dallas city limits, was starting to lose its luster.

A Reddit group dedicated to “dead outlet malls” wrote, “Hillsboro, Texas is a complete ghost town. All that's left is Bath & Body Works and Polo.” Polo is gone.

Another says: These are often one of the last remaining stores in a declining mall. Three times I've seen situations where mall owners get scared and start leasing space to local businesses when a major retailer leaves. ”

Henderson said the previous owner, Craig Realty Group of Newport Beach, Calif., showed little interest in reviving the declining mall. She rejected efforts to work with the city and others' proposals to acquire the mall, which has 356,296 square feet on a 43-acre site and would provide 2,354 parking spaces serving 185 individual units. He said it is possible that he did not respond.

Henderson said it was her understanding that Buc-ee's initially considered an outlet mall location for its Hillsboro store. She abandoned that concept when she learned it was owned by Craig Realty Group, she said. She said both sides crossed swords elsewhere.

Buc-ee's is currently completing a store just outside Hillsboro's city limits on a property the city plans to annex.

Then Henderson received a phone call that changed everything. Brian Glaser, president of Glaser Retail Partners in Dallas, got on the phone and told the city manager he was considering buying the Hillsboro Outlet Mall.

“I said, 'Good luck,'” Henderson recalled. “People were approaching the previous owner about buying the property or doing something with him, but they didn't think he would take up those opportunities. “It's a landmark that people see and associate with Hillsboro.”

Henderson recalls that Glaser took a different approach.

“He said, 'We have a lot of land and we don't need all of it, but what's the city's position if I take it back and do this?' Partner,” Henderson said. Ta.

The conversation sets the stage for changes that could include demolition of part of the Hillsboro outlet.

In that scenario, Glaser would add retail space and restaurants to a 300-foot stretch along the Interstate 35 frontage. The city plans to pursue tenants that are a good fit for the Hillsboro market and that are preferred by residents. These may include grocery stores, entertainment venues, and even warehouse and distribution space.

Community and Economic Development Coordinator Vance Lipsey will be instrumental in making this transition a reality. He is Hillsboro's outlet mall specialist, pursuing tenant acquisition and showing the center to interested parties. Lipsey said they are there, but not always ready to make a commitment.

Lipsey said Glaser's involvement could change the situation.

The city, including the Hillsborough City Council, was confident that Glaser Retail Partners could deliver on that promise and that the company had the experience and industry connections to serve as an ideal partner. Hillsboro agreed to pay Glaser $4.6 million for a two-thirds interest in the property.

“We bought it for $3.55 per square foot, but if he exercises that option, he will pay $4.25 per square foot to get it back from us. '' Henderson said. “We lend. … We're lending ourselves money. If we need cash for other projects, we use debt securities to fund them.”

Mr Henderson said he expects to see activity by the end of the year, but believes development may not materialize for three years.

“There is a 300-foot section along the access road that is ripe for development into a pad site,” Henderson said. “He has a track record of success elsewhere and also has relationships with strong players in the market.'' You can put it in.” I think it will be something you can be really proud of. ”

Henderson added, “We need to be proactive with the businesses that are most interested in Hillsboro. There are a lot of uses that are not tailored to the Hillsboro market. From what I've heard, it would be really great to have Topgolf.” Realistically, we're not in a Top Golf market. What we've heard is that Glazer is entitled to what's best for Hillsboro and what's best for himself.”

Henderson said growth could accelerate in Hillsboro as he is aware of at least four national homebuilders looking at the market.

Reached by phone, Craig Realty Group confirmed the sale to Glaser.

Brian Glazer previously worked in the Dallas market as president of the commercial retail division of The Weitzman Group, one of the largest commercial real estate companies in the United States, according to online information. Online sources say the Dallas Business Journal has included Mr. Glaser on its list of real estate “heavy hitters” for several years.