BPHoffman

We asked Book Passage if we could display on our Web site - the important response written to Hoffman by BP. Thanks for letting us!

We are very grateful to all of the people who have taken the time to write to the Town Center, expressing their concern about the possible leasing of the Marshall’s space to Barnes & Noble. The outpouring of community support has been truly gratifying. We are concerned, however, about the misstatements that Stan Hoffman, manager of the Town Center, has included in his form letter responding to these emails. The misstatements are serious enough that we feel we need to set the record straight. We hope you will bear with us as we try to lay out the facts involved in this dispute.

Hoffman:
“When the Woolworth's space became available, we offered it to them, but they declined. When the JC Penney's space became available we offered to them but they declined.”

The strongest recollection that we have, however, was the threat from Mr. Hoffman’s colleague. She said, quite bluntly, that we either move to the Town Center or they would bring in Barnes & Noble. She indicated that she knew that bringing in Barnes & Noble into the Town Center could have a negative effect on our business.

We told them that we didn’t respond well to these types of threats and that there was really nothing further to discuss.

The Facts:

When we found out that the Stroud’s space was available we decided to bury our misgivings and talk to Mr. Hoffman and his colleagues again. We stated right at the beginning that we would not talk to them at all if they repeated the threats about Barnes & Noble that they had made at the meeting years earlier. We were assured that these meetings would be conducted in a much different tone. Although she is still an executive with the leasing company, the woman who made the earlier threat did not appear at any of these meetings.

We were genuinely interested in renting the Stroud’s space and told them so. At first, they seemed very enthusiastic about renting it to us. They knew that there would be about a year’s overlap on our then current lease, but they said that they would be willing to buy us out of that lease and provide money for improvements to the new space. They asked us what we needed and said it would be provided. We spent a great deal of time making drawings, talking to contractors, and planning for the move.

Then, without warning, they withdraw the Stroud’s space from our consideration. They gave no satisfactory explanation for their change in attitude, and they were vague about who in their organization actually made the decision. Shortly thereafter they announced they were renting the space to Williams-Sonoma for a West Elm store. We are still puzzled by their switch from great enthusiasm to total refusal.

“At that time, we agreed that when the Marshalls space became available, they would have first shot at it. We spent almost one year negotiating a lease with Book Passages for the Marshalls space, including paying for meetings with architects and space planners. On 3/27/05 we received an email from Bill Petrocelli informing us that he had renewed his lease at his existing location. I have that email and am willing to share it with you.”

After they withdrew the Stroud’s space from our consideration, Mr. Hoffman and his colleagues tried to convince us to lease a portion of the Marshall’s space (They indicated that Marshall’s was leaving the Town Center – not being forced out). But what they offered us was totally unsatisfactory.

They didn’t offer us the “Marshall’s space,” as Mr. Hoffman indicated, but only a rear portion of that space that had virtually no light and an awkward configuration. According to them, they already had a signed letter of commitment with the Anthropologie company for the better part (the northern part) of that space. They would not even consider talking to us about that part of the space. Now it appears that their commitment to Anthropologie has been cast aside, and they are apparently now getting ready to rent the entire space to Barnes & Noble.

We tried to work with them to see if the space that they were offering could be made acceptable, explaining to them that we needed better light and a better design than what they were offering in order to accommodate the author events, classes, café, and the other things that make Book Passage what it is. We had one meeting with their architect, but he never came up a plan or design. Mr. Hoffman and his colleagues were unwilling to budge on what they were offering – even refusing to move a trash compactor that blocked us from putting windows and a proper door on the east side of the space. Finally, we decided that the cramped space that they were offering us just wasn’t going to work.

When we then began discussing our possible move the Marshall's space, we felt that it would only really work if we could get the north portion of that space. That part of the space is much more accessible to the public and has much better natural light -- both of these things are very important to us. We believe that Book Passage is somewhat unique among retailers, because we present over 500 author events a year and hold many classes, conferences, and book groups in the store. When you add to this our café and our big bookselling operation, I think it is clear that we need a space that is both open and flexible. I know we discussed this at some length in our meetings.

Unfortunately, the only part of the Marshall's space that was offered to us was the south end, which has difficult access problems and virtually no natural light. We thought long and hard about how we could make that space work for us, but there wasn't any satisfactory way to do it. I think we made clear to you and your architect in our meetings what the problems were. But the measures that were suggested seemed prohibitively expensive and not really satisfactory.

We finally decided that we could not risk the future of Book Passage in a space that we did not feel would be good for our business. For that reason, we have decided to stay where we are and to try and provide the best bookstore experience that we can for our community.”

Hoffman:
“We believe that Book Passage has a unique niche in this market and has held
their own with Barnes & Noble across the freeway and Boarders in San Rafael.
Neither of those chain stores operates on the same model as Book Passages.
Book Passage offers a high level of service and has authors and speakers from
all over the globe. Both Barnes and Boarders have limited service, few
speakers and offers discount prices. However, they do offer music and
movies that are lacking at Town Center. They have an entirely different
customer base then Book Passage. If Barnes were to move across the freeway
the status quo should remain in tact.”

The Facts:

Ths sugar-coated description of the book business is intended to get people believing that Barnes & Noble doesn’t really compete with Book Passage and that leasing this large space to them won’t have any ill effects whatsoever. But that’s not how chainstores operate.

No one should be under any illusion about what is going on here.

The Town Center is reportedly leasing to Barnes & Noble a space that may be close to three times larger than its current space and in a better location. In order to make this major move profitable, Barnes & Noble has to sell a lot more books – millions of dollars more annually. There can be no doubt that Barnes & Noble will make an all-out effort to grab the sales they need from other booksellers. That is the way that they have done business nationwide for over twenty years, and there is no reason to believe that they will change their tactics now.

It would be nice to think that the book business and book readership is growing so rapidly that all of these increased sales will come from new customers and not affect any other business. But that simply isn’t true. In the last couple of decades book readership in the U.S. has declined as a percentage of the population and book sales have been flat. During that same period, however, Barnes & Noble and the other major chain, Borders, has just about doubled the amount of retail bookselling space in the country by opening more than 800 outlets, many of them in the backyard of local independent bookstores. The sales necessary to sustain these two chainstores have come largely out of the business of independent booksellers. Independents have found their market share drop by about half during that period, and the number of independent stores has dropped by an even larger percentage.

It might be different if this chainstore growth was all the result of fair, honest competition, but it hasn’t been that way. Several lawsuits and an F.T.C. investigation have shown that the chains have benefited from discriminatory prices and heavy promotional allowances that they have extracted from publishers. When opening a new store in a community, they typically target their advertising and promotion to overwhelm the local competition before moving on to the next community on the list. They don’t have to siphon off all of the local business to force their local competitors out of business – usually a steady decline of about 10% will do it.

If the local independent business loses, the entire community loses. Studies have shown that locally owned businesses return money to their community in the form of local expenditures at a rate about 70% higher than their chainstore competitors. But they can’t do that unless they have a fair chance to stay in business. It is nice that Mr. Hoffman acknowledges that Book Passage “offers a high level of service” and that we have “authors and speakers from all over the globe.” But all of that means nothing, unless enough merchandise is sold to sustain it.

Where to Write

There is a strong likelihood that the Corte Madera Town Center is planning to lease the former Marshalls’ space to Barnes & Noble for a bookstore that could be 2 to 3 times larger than the present Barnes & Noble store.

If this happens, we have no doubt that Barnes & Noble will be using its considerable resources to target Book Passage and try to drive us out of business.

If you wish to express your concern about this, please write or send an email to the following people:

Glen Rosen
Madison Marquette Retail Services
12121 Wilshire Boulevard, Suite 1300
Los Angeles, California 90025
310-443-7500 / 310-820-2076 Fax

Stan Hoffman, Property Manager
100 Corte Madera Town Center, Corte Madera, CA 94925
shoffman@mmrs.com
415- 924-2961

Corte Madera Town Council
% Jay Tashiro
Town Manager, Corte Madera
300 Tamalpais Drive
Corte Madera, CA 94925
administration@ci.corte-madera.ca.us
415-927-5050 / fax 415-927-5087