Johnstown’s Miracle Mile
JOHNSTOWN – Real estate developer Michael Wachs likes to say that most of America is “over-stored and under-served.”
But when he first acquired the month-to-month lease of the P&C Supermarket in Johnstown in 1997, as well as a nearby KeyBank property, he saw a city where his retail maxim wasn’t true.
“Johnstown was under-stored,” Wachs said.
Over the past 15 years Wachs has worked to change that. His company, Johnstown Comrie Associates, LLC of King of Prussia, Pa., has brokered deals and made a series of acquisitions that have expanded retail businesses on both sides of Route 30A, effectively creating the Johnstown Shopping Center and revitalizing the Johnstown Mall.
Wachs recalls many barriers to retail expansion when he first arrived on the scene in the late ’90s.
“Even though the P&C Supermarket shared the same frontal plane as the balance of the shopping center the Johnstown Knitting Mill …. was a 50,000 square foot manufacturing space, that was a huge brick mall. It couldn’t have been further from visually appealing from the perspective of having a shopping center,” he said. “Then at the far right you had Video World and Romana’s.”
Wachs remembers the evolution of the shopping center in terms of deals. His first move was letting P&C go and making deals to fill the space with a Western Auto, later merged with Advance Auto Parts, and a Woodworkers Warehouse which later folded as a chain and was replaced with a Total Tan.
“The third move was knocking on the doorfront of the Dunkin Donuts on Main Street and the family that owned it came out and built their first ground-up Dunkin’ Donuts, which was a tremendous success to the point where they now bake on site instead of at their Albany location,” he said.
Wachs said he acted as a broker to bring Dollar Tree and Applebees to the property in the plaza controlled by the Johnstown Knitting Mill and brokered a deal to bring the Johnstown Movieplex to what had been the Pyramid Mall. His company then bought interest in the mall, after which Price Chopper expanded its business in the location.
In 2005 Wachs moved to aquire the remaining balance of the Johnstown Shopping Center from the Knitting Mill and bought a controlling interest in the mall, renaming it the Johnstown Mall.
“After I was finally able to make a deal for the rest of the shopping center we spent the next couple of years transforming it into store fronts instead of a gosh darn empty brick wall. We expanded Dollar Tree and brought all the other merchants in line,” he said. “We’ve always been able to maintain a 100 percent occupancy there.”
Wachs deal-making culminated in the recent 23,400-square-foot expansion of the northern end of the shopping center, into which moved discount retail clothing store T.J. Maxx.
“I had heard that they had been considering the Amsterdam market for T.J. Maxx and I reached out to them,” he said. “I suggested to them that if they took a look at Amsterdam in concert with Gloversville, Johnstown, which are in effect in a football I-formation but one market, and then Amsterdam and lastly the west-central side of the Schenectady-Albany market … that they might actually find that the Amsterdam consumer might already be shopping the T.J. Maxx in the Rotterdam area and very few people were actually driving from Johnstown and Gloversville to Rotterdam. They thanked me for the call and called me back a few weeks later and told me that their own internal market studies were telling them the same thing.”
T.J. Maxx spokeswoman Brittany Welch said she couldn’t comment on why the company chose to relocate it’s Rotterdam store to Johnstown, but said that one of the criteria used for locating a T.J. Maxx is that it be located in a “thriving retail area.”
Johnstown City Treasurer Mike Gifford said sales tax has become an increasingly important part of the city’s total tax revenues since he first became treasurer in the late ’90s and the expanded retail stores on Route 30A have been a large part of that growth. For the city’s 2014 budget Gifford expects the city to receive $3.4 million in sales tax revenue – that’s 72 percent of the city’s property tax levy of $4.7 million.
“This has been extremely key for us in our budget, the sales tax,” Gifford said. “It’s pretty obvious that without that $3.4 million, that property tax would be much higher.”
Gifford said Wachs deserves credit for expansion of the shopping plaza and the mall.
“I think you really need to have those types of business connections to bring in stores like that. You also need expertise in that retail field, so we commend him for that,” Gifford said.
Sam Vahaviolos, the owner of Roman’s Italian Kitchen and Sam’s Seafood Steakhouse, said he’s been impressed with the expansion of retail at the Johnstown Shopping Plaza. Vahaviolos has been a tenant at the plaza for 40 years.
“He spent money to fix things up and bring a lot of stores here and he brought a lot of customers here and it’s been good. I think with T.J. Maxx here it’s going to do even better,” Vahaviolos said.
One potential negative to the growth of the plaza has been increased demand for a limited number of parking spaces.
“The parking is going to be a problem here because on Saturday the whole parking lot is full and with T.J. Maxx here they didn’t add any parking, so I think it’s going to be tough with people parking all the way down to Dunkin’ Donuts, but there’s no room to add any parking right now. This is it,” he said.
Wachs said he thinks the shopping opportunities on Route 30A could still increase.
“I think there is opportunity for more growth there, but the fact of the matter is we’re running out of space,” he said. “We were lucky to attract T.J. Maxx, the preeminent merchant in their business in America, to Johnstown. Thank God we had the room to fit them in. There are neighboring properties that are underutilized and I believe they could be expanded. The challenge for relevancy is constant and you’ve got to be the best all the time and do what the customer expects. I do think there is growth opportunity in that little stretch of 30A.”