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Commercial Real Estate
Business Observer Friday, Jul. 26, 2019 1 year ago

Entrepreneur operates five storefronts in one area mall, with plans for more

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Malls nationally are struggling to keep tenants. But Paul Sykes has decided to lean into the benefits at Westfield Siesta Key.
by: Grier Ferguson Sarasota-Manatee Editor

An art gallery. An art museum. A cafe. A paint bar. A gymnastics center.

What do these businesses have in common? They’re all run by Paul Sykes. And they’re all at Westfield Siesta Key, an enclosed Sarasota mall owned and operated by Unibail-Rodamco-Westfield.

In recent years, the mall has struggled. Several national tenants have closed their doors. Efforts to make it a lifestyle center have had mixed results, with two restaurants shuttering. Recently, the company partnered with Sarasota-based commercial real estate firm Ian Black Real Estate to work on leasing with its in-house team.

Although other tenants have fled the Westfield Siesta Key —and malls nationally struggle with a plethora of vacancies — Sykes has taken a different approach. He’s doubled down at the property and sees the potential in the location, surrounding demographics and its physical attributes. The area is exclusive, he says, with high-wealth clientele nearby. Plus, Sykes describes the mall itself as “elegant,” “well-laid out” and “inviting” for both retail and service businesses.

“Westfield Siesta Key is one of the most beautiful retail spaces in Sarasota,” says Sykes, a Midwest transplant and veteran art gallery entrepreneur. “I enjoy helping the mall get back up on its feet. I know I’m a major component of that happening here at the center.”

State of the art

Sykes has been an international art dealer for 33 years. He opened his 11,800-square-foot Art Avenue gallery at Westfield Siesta Key when he moved here five years ago. 

The mall — known to many by its former name, Southgate — has been home to his gallery since he moved to Florida. He came to the area and opened a gallery because one of his clients from Cleveland has a place on Casey Key.

Lori Sax. Paul Sykes operates a storefront in the mall he calls an art museum.

Sykes also operates a separate storefront in the mall he calls an art museum. It houses investment-level art — paintings that sell for up to $4.5 million each. There’s a total of $20 million worth of art hanging on the walls. The mall has good security, Sykes says — an added benefit.  

Sykes declines to disclose the rent he pays for the storefronts. “It’s a very good deal for the kind of space you get,” he says. “It’s definitely a favorable lease deal.”

He says the leases are advantageous in part because the former leasing agent knew him from Cleveland malls where they did a lot of deals in the 1980s and 1990s. “He knew I would bring something to the mall that would be a higher-end product line and bring good cultural elements to the center,” Sykes says. “They like my style, so they allowed me more freedom here.”

At the gallery and museum, Sykes curates the collections, including pieces by emerging artists and well-known painters, from Vincent Van Gogh and Henri Matisse to Pablo Picasso and Salvador Dalí.

From 1987 to 2002, Sykes had a chain of 12 galleries based in Cleveland with additional locations in cities including Cincinnati and Nashville. Half closed because of the economy, and the others were sold, he says.

“Westfield Siesta Key is one of the most beautiful retail spaces in Sarasota. I enjoy helping the mall get back up on its feet.” — Paul Sykes, owner, Art Avenue

About half the galleries were in upper-scale malls similar to Westfield Siesta Key. “The enclosed mall seems to be my environment,” Sykes says.

He also recently opened an art gallery in Beverly Hills with a partner who lives in the area. “We got a really fantastic deal on rent, so we decided to take a chance,” Sykes says. “Beverly Hills is insane with rent.” So if a good deal comes around, he says, businesses should take it.

With galleries in different markets throughout the country, he’s learned that one key to success is to know the customer. In Beverly Hills, for instance, pieces by artists like Andy Warhol are on display. In Sarasota, tastes lean more toward artists like Marc Chagall and James Whistler.

At Westfield Siesta Key, his museum space is open by appointment. Sykes also draws customers by holding events in the space. He hosts up to 350 people for occasions ranging from birthdays to corporate meetings. Events amid the art also include private receptions for investment-minded businesses, such as financial planners. “We host a lot of events,” he says. “We are able to bring in our own foot traffic.”

Build the business

Like Sykes, Marilee Roberts generates her own foot traffic at the mall. And like Skyes, Roberts' Westfield Siesta Key success runs counter to industry trends. 

Roberts, owner and founder of Trebor Style, started with a pop-up shop at the mall. She says the mall approached her and asked if she wanted to come in temporarily. “I came in for the holiday season, and then I decided to stay,” she says.

That was almost six years ago. Now Trebor Style operates out of a former Williams Sonoma location and includes the jewelry, handbags and scarves she sells as well as two other businesses — Pineapple House, which offers home goods, and Rue, which sells women’s clothing and accessories.

“In the time we’ve been here, we’ve built a good clientele,” Roberts says. “People come into the shop all the time and say they love it. We specialize in a more artisan style of pieces — unique, one-of-a-kind pieces. It’s been good for us.”

Trebor Style doesn’t rely on people already at the mall for its main source of customers. Roberts says many mall shoppers tend to go to one store specifically — going to Macy’s then leaving or coming to Chico’s and leaving without shopping at other stores. “I would say most of the wanderers we get are people who wander in after lunch,” she says. “We have benefitted a little bit from the restaurants being here.” The CinéBistro movie theater also helps bring traffic in, she says.

Roberts has drawn traffic to Trebor Style by building up her clientele and hosting events. “A couple times a year, I’ll bring in a jewelry designer,” she says. She hosts cocktail parties and other events with food and music and ties them in with nonprofits. The organizations promote the events to their supporters, and the nonprofit receives a portion of sales. “It has worked out well,” Roberts says. “You’ve got to generate your own traffic for this mall. Anybody who’s in here has to learn what works for them and promote their business.”

Trebor Style sees a lot of repeat business, and Roberts says word of mouth has been amazing. She says she definitely plans to stay at Westfield Siesta Key. “People like the easy accessibility of it, and they like the location,” she says. “I hear people say that this is a beautiful mall. All it needs is just a few more stores in here, and the traffic will come back because people want to shop here.”

The mall, Roberts says, needs more businesses like hers and Sykes’. “I definitely think he’s generating traffic between the different things that he’s doing,” she says. “I really think they need to bring in more independent people because the chains are suffering everywhere.”

Hub of activity

Along with an art gallery and museum, Sykes’ Westfield Siesta Key holdings also include a cafe called Cravings. It does catering and provides a convenient lunch spot for mall employees.

Lori Sax. Paul Sykes’ Westfield Siesta Key ventures also include a cafe called Cravings.

It occupies a former Starbucks, which was handy, Sykes says, because it meant he didn’t have to do much to turn it into the cafe. (Cravings isn’t his first foray into the restaurant world. Sykes also owns a few high-end restaurants in Cleveland.)

Somersault, Sykes’ kids’ gymnastics center, opened at the mall in May 2018. “I wanted to try a business I knew nothing about,” Sykes says. The 4,500-square-foot space hosts lessons in Russian-style gymnastics as well as theater, singing and dance. It also offers summer camps. He says Somersault gives parents a chance to browse the mall while their children are in a session, which creates traffic for Sykes’ other ventures and drives traffic to other stores.

Lori Sax. Somersault, Paul Sykes’ kids’ gymnastics center, opened at the mall in May 2018.

Sykes expanded on his art-based businesses in December 2018 with the Art Paint Bar. The 5,000-square-foot space offers guided painting sessions for customers who can drink a glass of wine during the experience. The venue hosts individuals and gatherings for occasions like birthdays and corporate parties.

Lori Sax. Paul Sykes expanded on his art-based businesses in December 2018 with the Art Paint Bar.

In an email, Paul Dascenzo, general manager of Westfield Siesta Key and Westfield Sarasota Square, says Sykes' success bode well for the future of the property. “Paul Sykes’ businesses have impacted the mall by providing our guests with a community hub — from discovering artwork at his galleries, to sharing a cup of coffee at Cravings, to offering summer kids camp at Somersault for children," writes Dascenzo. (A representative from Ian Black referred questions to Westfield.) "This is an example of how our tenants and their programming provide variety while complementing the mall’s other offerings.”

Sykes is used to this kind of result. Over the past 30 years, he says he’s opened over 100 stores in different cities. “When I see a space, I can immediately envision a product line or service business for the space,” he says.

He already has five storefronts at Westfield Siesta Key, and he’s pondering what’s next. “I’m thinking about a furniture store,” he says. There’s even a rumor going around, Sykes says with a laugh, that he’s taking over the mall. 

Although that might not happen any time soon, he sees the path forward for the mall clearly. Sykes says, “This particular mall will have to bring in a variety of mom-and-pop businesses with high-level and high-price point merchandise.”

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