Target, HomePlace join Cincinnati retail invasion - Target Stores Inc.; new stores in the Cincinnati, Ohio, area

Discount Store News, Sept 2, 1996 by Shelly Reese

CINCINNATI -- Target and HomePlace have set their "sites" on suburban Cincinnati.

Target is readying to open six stores in the Queen City beginning late next year. Meanwhile, HomePlace, the Valley View, Ohio-based home fashions superstore, will open two stores here next spring and is looking for one or two additional cites where it can expand.

Target, which operates a single 96,000-sq.-ft. store in Middletown, Ohio (almost 40 miles outside of the city), hopes to open three stores here in late 1997 and three more in the spring of 1998.

It is also looking at cites in nearby Dayton, Ohio, where it hopes to open five stores, sources close to the deal said. Those stores are not expected to open until about a year after the Cincinnati stores. A Target spokeswoman declined comment on plans for either market.

HomePlace chairman Robert Hurwitz, who founded OfficeMax, said that the company will open two 53,000-sq.-ft. stores here in the spring, and it is currently negotiating a third location.

Target and HomePlace are the latest chains to swoop into Cincinnati, following general merchandise discounters such as Meijer, which opened the first of five stores in May, and Kohl's, which has opened five stores here since 1994. Other arrivals in the past three years include Stein Mart, Sun TV & Appliance, Best Buy and Home Goods.

Discounters are drawn to the area for a handful of reasons. In addition to an attractive customer base, the demise of several long-standing local retailers such as Swallen's and Van Leunen's during the past two years has created a window of opportunity, said Steve Brandt, a real estate broker with The Linder Co.

Strong national tenants with capital and an eye for expansion are coming in to replace local retailers, he said.

Target, which because of its Middletown store has long advertised in the market, plans to open 123,000-sq.-ft. stores in Cincinnati, sources said. While the stores will be larger than many of its existing stores, none will be the SuperTarget format, which combines grocery and general merchandise.

The retailer's Big Three rivals have already established locations in the city. Wal-Mart plans to have nine stores in the area by early 1997, while Kmart already operates 16 stores in the greater metropolitan area.

HomePlace, which operates 48 stores in markets ranging from Minnesota to Florida and as far west as Nevada, will target value-oriented, middle- and upper-middle-income customers.

While the Cincinnati stores are part of a national expansion--Hurwitz hopes to end the calendar year with 57 stores and increase that number to 97 stores by the end of 1997--he said that the market's demographics and Midwestern values make it appealing. As for competition in the area, Hurwitz said that he isn't concerned.

That attitude seems pervasive among discounters entering the market, said Chris Ohlinger, president of Service Industry Research Systems, a market research firm in nearby by Highland Heights, Ky.

"There's going to be fallout," he said, but everybody thinks it will be the other guy doing the falling.

"This was a very attractive market a couple of years ago when most of these retailers were putting together their expansion plans," he said. "It was underrepresented by discounters and there were no power malls. Since then, things have taken off in Cincinnati."