What the blue big-box furniture store might mean for Merriam.

Never-occupied Merriam Village is razed to make way for IKEA 

What the blue big-box furniture store might mean for Merriam.

click to enlarge Architectural_rendering_of_proposed_IKEA_Merriam__KS-high-res.jpg

It's Wednesday afternoon in Merriam, and there's no traffic around one of the city's nicest shopping districts. Zero traffic.

Wait, here comes someone. A blue PT Cruiser ventures into the parking lot at Merriam Village, along Interstate 35, just south of Johnson Drive. The car lingers a moment in front of the storefronts, then loops back out again. The storefronts are empty. No businesses are here — just a broken promise.

In 2004, the city approved a plan by DDR Corp. (then called Developers Diversified Realty) to erect a fancy new "urban village." Up went the strip mall. Then down went the U.S. economy. At the time of its completion, Merriam Village had signed only one tenant: Circuit City. But the electronics retailer collapsed into bankruptcy before it could occupy its brand-new store, leaving only "CIRCUIT CI" on the mall's otherwise blank marquee, a ghost visible to highway drivers long after the deal fell apart.

As former Pitch managing editor David Martin described luckless Merriam Village in 2008, "It's a village in the same way a prison is a community." But even prisons have people living in them, and over the past four years, this sad strip mall has remained empty. It's an embarrassment visible from the front steps of Merriam's City Hall, just up the hill, a daily poke in the eye of a suburban city's ambitions.

Now, though, that staggering failure may have led to a metrowide success.

On October 24 last year, Merriam City Administrator Phillip Lammers got a call from a lawyer working for IKEA. The Swedish furniture giant wanted to set up a meeting with the city.

"These guys knew more about us than we knew about them," Lammers says, recalling that first meeting with IKEA's reps. "They had been studying it" — Merriam Village — "for a couple years. They liked the market." IKEA favors building along highly visible and accessible interstate highways, in suburbs just outside major metropolitan areas. Retail sites don't get much closer to that model than Merriam Village.

And retailers don't get much closer to a sure thing than IKEA does. The company's clean-lined, inexpensive furniture inspires an almost cultish consumer loyalty — customers are happy to drive hundreds of miles to visit IKEA's big blue stores. The outlets closest to Kansas City are in Dallas, Minneapolis, Denver and Chicago — each at least a workday's drive away, making Johnson County the bull's-eye of a continental IKEA desert.

On top of that, Merriam Village's owner, DDR, has been shedding dead weight since the recession began. It has sold at least 55 of its properties (numbering more than 400) since 2011, according to its latest quarterly filing. Meanwhile, Merriam Village still sits in a tax-increment-financing district, designed to cut costs for development.

"This is a privately held company, one of the largest in the world," Lammers says of IKEA, "and they don't make a habit of telling everyone what their business is. But they are in the habit of landing in TIF districts, and so they know what to expect."

So how much of the IKEA hype should you believe? According to other cities where the company put down stakes, a lot of it.

In Canton, Michigan, a Detroit suburb not far from Ann Arbor, IKEA bulldozed a dead Kmart and turned the property into a big blue downtown anchor. "You can go there almost any day of the week and see license plates from all over the state of Michigan," says Kathleen Salla, a development coordinator for downtown Canton. "We're very close to Canada here, so Canadian plates come over, and we also have people that come from Ohio and Indiana to shop, so we do bring in a lot of people outside our market area."

"They put us on the map," says Thomas Paden, president of the Canton Chamber of Commerce. "Outside of our community, if they say, 'Where you work, where you live?' and they say, 'Where is that?' You say, 'That's where the IKEA is,' and they're like, 'Oh, right!'"

When IKEA decided to open in Portland, Oregon, in 2007, a reporter for The Oregonian wandered down the coast to West Sacramento, California, and found overnighters from Nevada who had driven in, eaten at local restaurants and stayed at local hotels to buy from IKEA. Other big-name retailers had also chased IKEA into town. Kay Fenrich, CEO of the West Sacramento Chamber of Commerce, said at the time that IKEA had brought in $1 million in sales tax in its first year, 7 percent of the city's overall take. (The chamber did not respond to a message from The Pitch seeking an update.)

Yet IKEA's plan for a store in Somerville, Massachusetts, just outside Boston, carries a mixed message for KC's IKEA devout. The bad news: IKEA bought property in Somerville in the 1990s but never built a store there. After years of wrangling between IKEA and the city, the company built a store 25 miles away instead, demonstrating that political friction can kill the golden goose. (IKEA eventually agreed to a land swap to help make room for a scenic riverfront-park development. "Our experience with IKEA was, although we were really disappointed they didn't build, they were quite a good public citizen, a good corporate presence," says Tom Champion, Somerville city spokesman.)

The good news: Merriam is nothing like Somerville. The Massachusetts city has in recent years made itself a model for walkable, mixed-use urban communities — the opposite of car-crazy Johnson County.

Not that building an IKEA in Merriam is a plan without warts. A Merriam IKEA looks likely to be a "category killer," in the parlance of retail consultants such as JRM Sales & Management's Joe Milevsky, who tells The Pitch that an IKEA would threaten the viability of nearby furniture outlets. And some Merriam residents probably won't be thrilled about all the new traffic. (Not Merriam Mayor Ken Sissom. "We are going to have the busiest QuikTrip in the world right down the hill," he crowed to The Kansas City Star after IKEA announced its proposal.)

How long will it take for IKEA to bring Merriam enough business to make up for all that the Merriam Village development siphoned from the city? Those numbers aren't known yet because the IKEA doesn't exist yet. IKEA is still negotiating to buy the property from DDR, so Merriam's golden egg is, for now, just a few sheets of paper sitting in the city's planning department.

The proposal goes to the city's planning commission November 7 for approval — the moment when Merriam's pursuit of the Next Big Thing begins in earnest.

"The frustration we've experienced for nearly the past four years has really paid off in terms of patience," says Merriam's Lammers. "This is a pretty nice reward."

If all goes well, all your friends' home furnishings will start to look alike in 2014. And the view from Merriam City Hall will finally look a little different.

Comments (7)

Showing 1-7 of 7

Add a comment

Subscribe to this thread:
Showing 1-7 of 7

Add a comment

Latest in News

Facebook Activity

All contents ©2014 Kansas City Pitch LLC
All rights reserved. No part of this service may be reproduced in any form without the express written permission of Kansas City Pitch LLC,
except that an individual may download and/or forward articles via email to a reasonable number of recipients for personal, non-commercial purposes.

All contents © 2012 SouthComm, Inc. 210 12th Ave S. Ste. 100, Nashville, TN 37203. (615) 244-7989.
All rights reserved. No part of this service may be reproduced in any form without the express written permission of SouthComm, Inc.
except that an individual may download and/or forward articles via email to a reasonable number of recipients for personal, non-commercial purposes.
Website powered by Foundation