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After Some Uncertain Years, the Village Commons Makes a Comeback
Jeffrey Labrecque

Jeffrey Labrecque says good relationships with tenants are helping move the Village Commons complex ahead.

Ten years ago, the Village Commons in South Hadley was having more than its share of problems. Tenants were unhappy, or else they were moving out; the stores inside weren’t what many had hoped for, and a feeling of unrest was settling over the architecturally striking shopping center owned by Mount Holyoke College. There’s been a quiet turnaround in recent years, however. Occupancy has improved to 100%, and management is involving tenants in a greater number of decisions. Now, some say ‘the Commons’ is starting to feel like the bustling retail and business center it was
always supposed to be.

Jeff Labrecque, COO for Center Redevelopment Corp. (CRC), the management firm that handles operations at the Village Commons in South Hadley, says he’d sooner hold a bottle-and-can drive than ask the shopping center’s owners for an influx of cash.

That sentiment was born, he said, from a time, not so long ago, when The Village Commons survived only when financed by its corporate parent and neighbor, Mount Holyoke College. And it has only been strengthened by a subsequent turnaround the Commons has orchestrated.

“At one time, we were draining funds from Mount Holyoke to survive,” said Labrecque, noting that when his current management team was formed, a goal was set to redefine the complex as one that could stand alone on its own two feet.

“The arrangement we made was that we would not borrow from Mount Holyoke,” said Labrecque. “That earned us the respect of the tenants, and now, 10 years later, we require no money from the college, and we never want to ask.”

Mount Holyoke College made a sizable investment in the Commons in the early 1980s to improve South Hadley’s town center and create a more welcoming atmosphere for both potential and current students, faculty, and their families, as well as general visitors.

The original vision of quaint, upscale shops and restaurants that would draw visitors from near and far has proven, however, to be largely unrealistic. But there is life in the Commons — spawned by a workable mix of office, retail, and residential tenants — and a great deal of optimism for the future.

BusinessWest looks this issue at how the picture continues to change, and for the better.

Making Change

Beyond ownership, Mount Holyoke has little involvement on a regular basis, said Labrecque. CRC handles day-to-day management of the complex, which hosts 56 businesses and 19 residential units and is led by President James Carey, who was appointed to his post in 1996. Labrecque was promoted to his current position at the same time, having previously served as director of operations at the Commons, and administrative assistant Trish Neiland rounds out the sparse team.

The Commons has navigated its share of bumpy roads since its inception, especially in the mid- to late ’90s. In addition to a lack of self-sufficiency, many storefronts were vacant, and, according to some tenants, that was due to a lack of a clear vision and a cohesive management plan.

Darby O’Brien, owner of Darby O’Brien Advertising, located in Building 9 of the Commons, was vocal about the center’s issues in 1997. At that time, O’Brien had been a tenant for six years, and told BusinessWest that the shops had “no buzz” and that the complex had “lost its soul.”

But he doesn’t feel that way now. O’Brien’s sentiments toward the Commons have become more positive, and he said it’s the development’s new management that has made a difference.

“I’ve been critical in the past, but things are moving well, and that’s because of the front office,” he said. “We’ve been here since this building went up, and when we first showed up, there was tenant unrest. But now, it feels like a neat little community. Jeff Labrecque is hands-on and non-stop; he understands small businesses, and really, it’s been calm ever since he stepped in.”

O’Brien said he gets the impression that through careful perseverance and hard work, many of the Commons’ issues are being resolved, or at least addressed.

“Several businesses are thriving here, expansions have happened … I noticed that the landscaping is really up to speed, and (CRC) seems to be employing local, independent companies. I think things have come together. I wondered back then how it would happen, but now I don’t even think about it anymore — this is a relaxed, fun, little neighborhood, and it feels good to be here. A lot has changed.”

Scrapping the Original Plan

LaBreque agreed that the climate at the Village Commons has in fact shifted, and while challenges remain, including the maintenance of architecturally unique buildings with unique problems, there are several positives to report.

For one, the complex is on more solid financial footing than it was 10 years ago — overall revenue at the retail stores ticked up by 3%, on average, over last year, while the restaurants averaged a 1% increase. Occupancy has also improved dramatically over the past decade. Between 1997 and 1998, CRC increased occupancy from 70% to 90%, and the Commons has been fully occupied since Sept. 11, 2002.

Currently, the ratio of office tenants to retail businesses is about one-to-one, and that’s one example of a change to what Labrecque refers to as “the original plan” for the property, which leaned more heavily on retail operations than office use.

“The original business plan that was put together was more retail and restaurants than office space,” he said, “but we’ve moved more toward office leases because those and residential rentals create stability and constant, consistent revenues.”

The original plan also included attracting upscale, trendy retailers proffering high rents. And while attracting quality tenants is still very much an objective, the focus on recognizable names and high-end merchandise has softened. Labrecque said the businesses that were expected simply never came, and many might not have even considered the Village Commons an adequate location.

“Tenants and Mount Holyoke were sold a bill of goods that didn’t play out,” he said. “For one, national tenants were promised, but the buildings here just weren’t built to attract them — they need space, on one level. There are 11 Victorian, all-wood, free-standing buildings here that are like houses — the largest space is about 3,000 to 4,000 square feet, and that’s why there’s no CVS here.”

Labrecque added that high vacancy rates became the root of other problems on the property in the late ’90s, some of which CRC is still working to correct.

“When the original plan didn’t come together, people were upset,” he said. “Tenants were unhappy, and the college was unhappy. Management wasn’t performing — they started treating it like a mall, affixing marketing fees on top of tenants’ rent.”

To begin a return to health, CRC did away with marketing fees and rents based on projected percentages of business when Carey took over as CEO, and instituted gross leases instead.

Lebrecque added that current lease rates are on par with similar markets. “ It is fair to say that the current rents are lower than the projections presented to the owner by the developer some 19 years ago,” he said.

New Day Dawning

That change, plus an overall shift to better incorporate tenants into the decision-making process at the Commons, has helped some businesses feel the same sense of inclusion that O’Brien cited as a benefit that once seemed lost.

Royanna Law, owner of Arts Unlimited, an art gallery offering framing services, retail sales, and corporate art consulting, relocated her operation to the Commons from Chicopee eight years ago, and characterized her decision as “wise.”

“The move to the Village Commons has proven to be a great place to have a business, and I really enjoy the people I work with, as well as my faithful clientele,” she said.

Law was one of the businesses that was able to expand recently within the complex, adding a gift gallery three years ago. Labrecque said hers is an example of how CRC is working with tenants to both retain them and strengthen the Commons as a whole.

“What we’re doing now is building from within,” he said. “We have a core group of tenants, and we are working to find out who needs what — expansions or changes, for instance — before going outside.”

As another example of renovations and expansion, Labrecque said the Commons will soon be seeing tenants leave for the first time in five years; 60 Minute Photo is closing its doors in response to increasingly sparse business for photo developers, and Saia Jewelers will also be leaving the complex soon.

But instead of viewing the changes as a dip in business, Labrecque sees an opportunity. The open space will allow for an office expansion project as well as a renovation of the Odyssey Bookshop, the Commons’ first tenant, and he expects the complex to be fully occupied again within a few months.

“We have an understanding of the types of businesses that do well here, and as such, we are also more discerning with leases,” said Labrecque of the decision to invest in existing tenants, rather than scramble for new ones. “We don’t fill empty spaces with the first offer we get to save face. That affects our overall stability, and just causes a lot of in and out.”

Moving forward, there are some concerns to address; the Commons is not located in a particularly high-traffic area, he said, so it must be marketed as a destination to thrive. Conversely, the shops’ parking lot is proving to be too small of late, and CRC and Mount Holyoke are also looking into a parking expansion to better accommodate shoppers, although that plan is only in the fledgling stages.

“Most of our tenants’ sales are good, but we’ve noticed they’ve maxed out,” said Labrecque. “We’re still looking at ways to pay for that investment; steel and concrete are so costly now — it will probably be some sort of platform, not a garage, and we’re asking our tenants for input on that.”

But Labrecque said infrastructure issues are his biggest challenge now, with repairs surpassing utility costs in his budget.

“The expenses keep growing. Our tenants provide us the revenue we need for upkeep, but we still spend every dollar we take in — we don’t have ‘plenty of money,’” he said. “We’re constantly correcting building issues, and it’s our largest budget buster. We’ve probably spent more than a half-million on builder blunders.”

Those issues include roof failures and water damage that began in earnest about eight years ago, with no signs of abating.

A Penny Saved Is a Penny Spent

In addition, the Commons faces retail challenges that continue to affect most small businesses and collections thereof, such as the pressure created by big-box stores and national chains that provide both convenient locations and, often, lower prices. It’s a reality, says Labrecque, that at this point in American business must be accepted.

“The nature of the business is delicate,” he explained. “The picture isn’t always great. It gets tiring at times, but it’s always challenging, and that’s what keeps us moving.”

Progress comes slowly, but there are no can drives in sight, and that’s Labrecque’s most oft-used benchmark.

“We don’t have a dime to save,” he said, “but we do have a dime to spend, and that means we spend that dime on improvement.”

Jaclyn Stevenson can be reached at[email protected]