Some leaving San Fran for Vegas
By Furniture Today Staff -- Furniture Today, July 14, 2002
LAS VEGAS — A number of San Francisco market exhibitors have either jumped ship for the proposed World Market Center or are on record saying they will eventually leave for the new market.
Of the 150 tenants named for Las Vegas, seven are known to be leaving San Francisco behind — Kushwood, Arbek, Boyd, Pulaski and more recently Sandberg, Comfortaire (which showed in San Francisco with Sunset Trading) and P.J. Kids. And the criticism of San Francisco has grown harsher lately.
"P.J. Kids has been disappointed in the San Francisco Furniture Market," said Stewart Paul, president, who will show in the Vegas Kids area of WMC. "With the number of buyers decreasing and more and more exhibitors pulling out, the draw for the retailers is just not there any more."
He also praised Las Vegas as "a very desirable host city."
Likewise, specialty sleep producer Comfortaire, which has shown in San Francisco for the past few years, won't be there this month, said Larry Wride, vice president of sales.
"There hasn't been the traffic," he said.
"The majority of people would agree Las Vegas will give our industry exposure to a wider audience, a world exposure, and not just a U.S. exposure," Wride said. "And if you look at the list of people who will be showing there, we are in some good company."
San Francisco Mart President Michael Gennet doesn't appear overly concerned. He said P.J. Kids, for example, was a small tenant in a multi-line showroom. "I don't know if they ever gave San Francisco a chance. They never exhibited as much of their line as they did in High Point," he said.
He said most of the departing tenants have had a long history of successful business in San Francisco. But "like a lot of business strategies, they may think it's time for a fresh venue."
He added that some of the companies that have signaled the switch "have not shown the financial stability and resources to continue as a Mart tenant, much less assume a much more expensive lease in Las Vegas." Gennet would not name them, but said two case goods companies heading to Las Vegas were evicted from the San Francisco Mart earlier this year, and the Mart has collected judgments against them.
"We believe that the tenants who have signed leases — ex-San Francisco Mart tenants and not — have bought a lot of hype and a very expensive lease with open-end provisions that are heavily weighted in the developer's favor," he said.
"We find it difficult to believe the manufacturers' written business will produce a satisfactory return on investment based on high lease rates and unlimited pass through of the market center's operating expenses," he said
Responding, Shawn Samson co-managing partner of the Las Vegas project, said, "The success of our leasing program speaks loudly and clearly.
"With more than 75 current and former exhibitors of the San Francisco Mart already signed as tenants of World Market Center, obviously, those companies recognized compelling reasons to support their important business decisions. Additionally, World Market Center has attracted more than 75 other tenants which are not exhibitors at the San Francisco Mart."
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