Macy's boss: Government has to step up

Macy's Florida Chairman Julie Greiner says she hopes to keep the retailer and its corporate headquarters in Miami's central business district, but that will depend on what government leaders do to improve safety and security.

"We have a decision to make, " said Greiner, who arrived in Miami in July 2005 as chairman and CEO of Macy's Florida after almost 12 years at Bloomingdale's. "We have to provide our customers and our employees with a safe, clean environment. I have a pretty good idea of [what] we need to be successful. This isn't it."

In the first interview since her blunt speech at the Greater Miami Chamber of Commerce luncheon pointing out deplorable conditions downtown, Greiner talked about why she decided to go public with her concerns and what it all means for Macy's future in downtown.

The company's roots in downtown Miami date back to 1898, when William Burdine opened W.M. Burdine & Son at the southwest corner of Avenue D and 12th Street (today's Flagler Street). Macy's, which moved into the current location in 1912, has about 900 employees downtown, between the Florida corporate office and the store.

"My purpose in speaking out wasn't to gain an advantage for Macy's, " said Greiner, who admits she never expected the countless letters, e-mails and phone calls of support that she received after her speech. "But to encourage the development of an overall plan that will benefit not only Macy's but all of downtown."

Greiner said Macy's must decide whether the store and the company's Florida corporate offices will remain on Flagler Street, although she won't say by when those decisions will be made. The leases on part of the two Macy's buildings expire in 2016.

As the largest retailer and one of the largest private employers in the central business district, what happens to Macy's could swing the fortunes of at least the Flagler Street area. That's why city leaders believe it is critical to convince Macy's of the area's vitality and the new customers that will come from 20,000 condominiums to be completed in Miami-Dade within the next two years, many of which are downtown.

"If they left, it would be very bad for downtown, " said former Miami Beach Mayor Neisen Kasdin, now a member of the Downtown Development Authority and chairman of the Greater Miami Chamber of Commerce's committee on downtown. "If they make a commitment and create a great department store, that would be a catalyst for other retail investment."

Miami City Manager Pete Hernandez has already taken the first step toward showing Macy's that things will be different. The city reached an agreement this week with the property owner that will lead to the demolition of the former Lerner New York building at 30 E. Flagler St., just east of Macy's, Hernandez said.

The roof on the building had collapsed, leading to water seeping into the building, which caused rotting wood, mold growth and a foul odor. That's not to mention the unsightly nature of the rundown, fenced-off and abandoned building. Hernandez said the demolition will begin in four to six weeks and be completed no more than 60 days later.

But the resolution is no reaction to Greiner's public speech, he said. It's the outgrowth of discussions Hernandez, Mayor Manny Diaz and other downtown leaders have had with Greiner and her team since January about Macy's concerns for downtown.

"The Lerner issue was the most egregious, and that was the one we had to deal with first, " Hernandez said. "If we couldn't get that done, it would be difficult to get them to believe we could do other things."

City leaders want to see Macy's do its part for upgrading downtown by investing in renovating its store and offices. Many in the community have found it hypocritical for Macy's to be complaining about the state of retail downtown when its store doesn't meet standards for the rest of the chain.

Diaz said he hopes Macy's opens up boarded windows on the ground floor and goes back to something resembling the original Burdines.

"Their store is outdated, and it needs to get a new face lift, " Diaz said.

City leaders said they are willing to craft a package of government incentives to help Macy's offset renovation costs -- once they identify what they are.

"It can't just be the private sector sitting around waiting for government to do something, " Diaz said. "It requires a joint effort."

Greiner said "we can do better" in the store, but she will not take a renovation plan to the Macy's board of directors until downtown leaders commit to cleaning up the area, making it safer and improving parking.

"We're a public company, and we need a return on investment, " she said. "I can't invest in an environment like this. It's not just about a building and a renovation. It's about developing a more comprehensive plan that will be executed."

Greiner won't disclose the sales performance of the downtown store or whether business has suffered, but she says the economic impact of downtown on Macy's business is clear.

"It's measured in customers we don't see and talent we don't recruit, " Greiner said. "It's lost opportunity."

If Macy's decides it wants to leave its Flagler Street location, there will be no shortage of potential suitors, including any of the projects planned for the Biscayne Boulevard corridor. Greiner says the company will "entertain options."

"Macy's can't be successful as long as we're in this environment, " she said. "Good retail thrives on a vibrant downtown."