Outlet Shoppes to change contract amid declined sales
A decrease in the outlet’s number one clientele naturally chipped away at sales and brought down their earnings by 44% compared to the prior year.
LAREDO, Tex. (KGNS) - The loss of the Mexican shopper is costing the Outlet Shoppes of Laredo a pretty penny.
The pandemic and extending border closures is chipping away at sales, but have things ever been picture perfect?
Situated on the banks on the Rio Grande with vibrant colors and a huge sign meant to be seen, especially by people across the river, the Outlet Shoppes of Laredo opened its doors to the American and Mexican shopper in 2017.
It was an attraction the City of Laredo needed to get downtown back on its feet, but would it be the economic driving force everyone hoped it would be?
”While the center has been a great success it hasn’t been a financial success, in the sense that we haven’t made any money on owning the center at this point,” said Gary Skoien.
Gary Skoien, president of Horizon Group Properties who are the owners of the Outlet Shoppes, says business especially along the border has been tough.
”It opened in a difficult time. It opened when there was a lot of border disruption, it opened when there was a lot of bankruptcy in the retail world, and it opened up when there was a lot of changes... and then of course, COVID was a killer.”
Not only COVID, but the federal halt of non-essential travel.
”It’s different all over the country and it’s different with properties that we have all over the country. The border cities- Laredo and El Paso- we have a center, they’ve really been hit badly much worse than Atlanta and Louisville, Kentucky.”
A decrease in the outlet’s number one clientele naturally chipped away at sales and brought down their earnings from the city by 44% compared to the prior year.
The city gives the outlet the money they collect from sales tax generated at the shoppes.
Between 2017 and 2019, the outlets made roughly half a million dollars each year, 2018 being their best year with a nearly $578,000 reimbursement.
Two years later, a significant decrease to $319,000.
As of now, the outlets haven’t been paid for 2020.
”They have not been given that because they have not show compliance, and so we haven’t given them the money, the rebate based on 2020,” said Rene Benavides.
Laredo city attorney Rene Benavides tells us that due to financial issues, the outlet hasn’t been able to meet the contract requirements.
Therefore, the outlets asked that changes be made, one of those is pushing back the start of phase two which is the building of additional retail space.
”That would delay the construction of phase two, but the rebate that they would be getting would be kind of held in abeyance during that two year period and then if they’re in compliance when phase two begins then they would resume getting the tax incitement.”
It’s not all bad news, the outlets were able to bring in new businesses to the shoppes.
However, all eyes remain on the return of the Mexican shopper to the city’s biggest downtown investment.
Other requests included reducing the number of employees required to work, returning a nearby property to the city, and keeping a city tower on outlet property.
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