Shoppers News

MERCEDES, TEXAS - With a blare of mariachis and a platform sagging under the weight of public officials wanting to take part, this impoverished Mexican border city recently cut the ribbon on a $50 million outlet mall that boasts status labels like Burberry, Izod and Coach.

Shoppers, including Mexican nationals, crowd the walkways at the Rio Grande Valley Premium Outlets in Mercedes, Texas. The upscale outlet mall is luring wealthy Mexican shoppers -- and their dollars.

Although the median household income is half the national average and only 15 percent of its residents have graduated from college, towns like Mercedes are the jackpot for retailers who find their stores accessible to Mexican luxury shoppers, particularly from the mansion-filled hills of Monterrey, 120 miles away.

And so far, cross-border holiday shoppers have helped keep cash registers ringing at Mercedes' new Rio Grande Valley Premium Outlets, owned by Simon Property Group Inc., a subsidiary of Chelsea Property Group.

"The Mexican consumer really likes to go shopping in the United States," Chelsea President John Klein said. "We have had that experience in other malls in the Valley; it's a family event."

Augustin Gomez, 31, and Jesse Gonzalez, 28, drove from Monterrey for a daylong trip to Mercedes. Both said they spent about $400 on clothes and shoes for their children.

"We come for the prices, and we'll be returning before Christmas," Gomez said.

"They don't have all these stores in Monterrey," Gonzalez said.

Alicia Mansur, a stylish 26-year-old from Ciudad Victoria, Mexico, said she shopped in the U.S. about six times a year, usually spending about $1,000 at a time. She said her friends told her about the new mall and she couldn't wait to come.

"Banana (Republic), BCBG, Burberry, Calvin Klein ... the same clothes in Mexico would cost much more," she said.

Strategically Placed

The outlet is strategic -- less than 45 minutes from several international border crossings and well within the zone for which Mexicans need only a short-term visa to travel. U.S. Customs and Border Protection has inland immigration checkpoints about 70 miles north of the border.

It's also aimed at shoppers who used to drive more than four hours from the border to the high-end outlets at San Marcos, just north of San Antonio.

"When they were going to the outlet centers in San Marcos they would have to get two permits, then they would have to get past two checkpoints," Mercedes Mayor Joel Quintanilla said. "The Mexican families that we talk to here at the outlet centers are very excited. They can spend more time shopping instead of being on the road."

Mercedes put about $500 million into infrastructure to accommodate a mall that when full doubles the town's population. A new water treatment plant and water tower were built. Roads were added. Eight police officers were hired.

Quintanilla and representatives of other Rio Grande Valley cities traveled to Mexico to promote the mall and work out deals with bus companies. One company is running a Christmas special that takes Mexicans from Tampico to Harlingen. The trip includes a trip to the outlet mall in Mercedes and at Harlingen's Wal-Mart and Target, just as attractive to Mexican shoppers as the outlet malls, and lodging. Other buses are arriving daily from McAllen.

Retail Explosion

With 35 percent of sales in McAllen and 26 percent of sales in Brownsville (the Valley's two largest cities) going to Mexicans, economists at the Dallas Federal Reserve call retailing an "export sector" for the Valley.

Steve Ahlenius, president of the McAllen Chamber of Commerce, said population growth and industrial growth along the border since the 1994 North American Free Trade Agreement has made for a retail explosion. He said he expects holiday sales to be as much as 10 percent higher than last year's.

While entry-level retail jobs may be low-paying, Ahlenius said they are a boon for students who commute to the two state university campuses or for those looking for second jobs. And many end up in management positions, he said. The corresponding rush of construction and maintenance jobs all contribute to the area's spending power.

"In terms of income we are still the lowest in the country, but you mix in the Mexican nationals and all of a sudden things even out," he said. "I think it's only natural that this has been an untapped market. ... What we're seeing today is a result of that market being realized and a rush to get into it as quickly as possible."

Private jets fly wealthy wives into the airport in McAllen, 21 miles from Mercedes. The parking lot at McAllen's La Plaza Mall fills every weekend with late model cars and sport utility vehicles bearing Mexican license plates.

Wal-Marts in the Valley accept pesos and have kiosks for filling out forms that allow Mexicans to shop free of sales tax.

Lines form on Sunday mornings outside McAllen's IHOP and Denny's with Mexican nationals filling up on fast-serve American culture.

Big Spenders

The wealthiest will fly in, according to the study by the Center for Border and Economic Studies spending about $8,000 a year. The same study found that lower-income Mexicans crossing on foot or in buses spend about $1,000.

North McAllen's succession of strip malls, restaurants, and independent specialty shops, now blends into neighboring Edinburg's.

Already, Mercedes Mayor Quintanilla said, the anticipated tag-along development to the mall is coming, and without financial carrots from the town.

"They're eager and willing, which is great," Quintanilla said.

A Chili's Bar and Grill has opened alongside the mall, a La Quinta Inn is under way, and other retailers and hotel operators are eyeing property, he said. Developers are planning a 60-home development and new gas station.

Meanwhile, diplomatic notes have begun to be exchanged indicating support on both sides for an international bridge that will connect Mercedes to the Mexican border city of Rio Bravo.

Artisans and vendors in Rio Bravo will benefit from U.S. travelers seeking less clogged routes to Mexico as well as Mexican travelers wanting quick access to the outlet mall and other parts of the valley, said Adrian Gomez, Rio Bravo's head of economic development.

"I tell some of the investors here they need to consider Monterrey and Mexico City," Gomez said. "With an international bridge there's going to be crossing through Rio Bravo; they're going to see what we have to offer."

High-end outlet mall brings big bucks to poor Texas city

BORDER: Spending by wealthy Mexican nationals is creating jobs and a retail boom.

• Exclusive Online Coupons

• Rio Grande Valley Premium Outlets draw visitors to Mid-Valley
  Map of Valley The grand opening of the new Rio Grande Valley Premium Outlets has brought the attraction of power shopping to the Valley. The central location of the outlet mall gives shoppers a whole new reason to stay in the Mid-Valley area. Shoppers can stay overnight in Weslaco while still being close enough to enjoy the sand and sun at South Padre Island or enjoy traditional shopping at nearby malls. Old Mexico-Nuevo Progreso and its markets and fine dining are just 8 miles away. Some of the World's Best Birding is in Weslaco at the nearby Santa Ana Wildlife Refuge or many other nearby locations on The Great Texas Coastal Birding Trail.

• Voucher for a Free VIP Coupon Book

• 5001 East Expressway 83
  Mercedes, TX 78570
  Phone: 956.565.3900
  
  Rio Grande Valley Premium Outlets is conveniently located off US Expressway 83 and Highway 1425 at Mile 1-1/2 East Road. Mercedes, Texas.
  
  * Taking Expressway 83 East: Exit at Mile 2 E. Road
  * Taking Expressway 83 West: Exit at Mile 1 E. Road

• 

• Deals Around Town

• Mon-Sat 10am-9pm; Sun 11am-7pm
  
  Join them on Tuesdays for the 50+ Shopper Club. If you are at least 50 years of age you can take advantage of an added 10% savings on Tuesdays by simply presenting a photo identification with your proof of age to the cashier at participating stores.
  Extended hours:
  Sat, Mar 31 - Sat, Apr 7: Mon-Sat 9am-10pm; Sun: 10am-8pm
  Sun, Apr 8 - Easter: closed*
  *Selected Stores Will Be Open Noon - 6pm: A'Gaci, Adidas, Calvin Klein, Geoffrey Beene, Izod, Levi's Outlet, Little Me, Perry Ellis, Robert Wayne Footwear, Samsonite, Starbucks Coffee, Torrid, Van Heusen, Vitamin World

• Insider Info from Your Favorite Brands

• Attractions

• Dodge Arena (area concerts and events) - Hidalgo (956) 843-6688
  Gladys Porter Zoo - Brownsville (956) 546-2177
  RGV Livestock Show Grounds - Mercedes (956) 565-2456
  South Padre Island (Convention & Visitors Bureau) (956) 761-6433
  Valley Race Park - Harlingen (956) 412-7223

• Email Updates: Sales & Special Events

• 

• Store Listing
  
  Adidas
  Aeropostale
  A'Gaci
  Aldo Outlet + Kids
  Ann Taylor Factory Store
  Anne Klein
  Asian Chao
  Auntie Anne's Soft Pretzels
  Banana Republic Factory Store
  Bass
  BCBG Max Azria
  BCB Girls
  Brooks Brothers Factory Store
  Burberry
  Calvin Klein
  Carter's
  Casual Male XL
  Charlotte Russe
  Claire's Accessories
  Clarks Bostonian
  Coach
  Converse
  Crabtree & Evelyn
  Crocs
  Disney Store Outlet
  Dockers Outlet
  Easy Spirit
  Ecko Unltd
  Eddie Bauer
  Factory Brand Shoes
  Footlocker Outlet
  Fossil
  Fragrance Outlet
  Gap Outlet
  Geoffrey Beene
  Guess
  Guille's El Pollo Asado
  Gymboree Outlet
  Izod
  Jockey
  Jones New York
  Journeys
  K*B Toy Outlet
  Kasper
  Kids Supercenter
  Kipling
  Kirkland's Home
  Kitchen Collection
  La Paletera
  Lancôme-Designer Fragrance & Cosmetic
  Lane Bryant Outlet
  Las Cazuelas
  Levi's Outlet
  Limited Too
  Little Me
  Liz Claiborne
  Lucky Brand Blue Jeans
  Maidenform
  Naturalizer
  Nike Factory Store
  Nine West
  Oakley Vault
  Official Dallas Cowboys Pro Shop
  OshKosh B'Gosh
  PacSun
  Papaya
  Perfumania
  Perfumes 4 U
  Perry Ellis
  Petite Sophisticate Outlet
  Puma
  Rack Room Shoes
  Robert Wayne Footwear
  Rocky Mountain Chocolate Factory
  Rue21
  Samsonite Company Store
  Shoe Carnival
  Skechers
  Sony
  Starbucks Coffee
  Strasburg Children
  Stride Rite Keds Sperry
  Subway
  Sunglass Hut
  Sunglass Icon
  The Children's Place Outlet
  Time Factory Watch Outlet
  Tommy Hilfiger
  Torrid
  Totes/Sunglass World
  Ultra Diamonds
  Van Heusen
  Villa Fresh Italian Kitchen
  Vitamin World
  Wilsons Leather Outlet
  Zales Outlet

• 40 more stores coming to outlet mall
  
  MERCEDES — Rio Grande Valley Premium Outlets mall will add a second phase of stores seven months after the stores opened.
  
  City officials said a third phase with even more stores is expected in the future.
  
  The outlet mall announced plans for a 150,000-square-foot expansion on the north side of the existing stores, which will provide space for an additional 40 stores plus parking, bringing the total to 150 stores.
  
  Construction on the second phase will begin in June, and bring the shopping center to 550,000 square feet, according to a news release from Chelsea Property Group, the mall owner.
  
  Ruben “Chano” Guajardo, city commissioner, said the second phase of the outlet construction is right on schedule.
  
  “It’s exciting for Mercedes and shows that the company has confidence in the community,” Guajardo said. “They moved on with Phase 2 because they are satisfied with how the outlets have been doing.”
  
  City Manager Ricardo Garcia said that along with construction, the expansion will include infrastructure such as sewer and water lines.
  
  The city’s contract with the mall owners includes three phases of construction. The city will return half of the sales taxes generated by the outlet center to Chelsea Property Group for the next 10 years, Garcia said.
  
  Chelsea originally built on 54 acres that it purchased for Phase I, Garcia said. Now, Chelsea has bought an additional 23 acres.
  
  According to the news release, the new buildings will be adjacent to the existing stores and will keep the center’s village architectural design.
  
  The new stores should open within a year, Garcia said.
  
  Guajardo said he expects the expansion to also attract new businesses.
  
  “The next phases will allow individuals out there to be confident in building in Mercedes,” Guajardo said. “That makes it a lot easier for others to build here.”
  
  City Commissioner Leonard Garcia Jr. said at this pace, the Mercedes outlets could eventually compete with San Marcos for international tourism.
  
  The two outlet shopping centers in San Marcos, between Austin and San Antonio, have more than 240 stores.
  
  “The amount of money generated has doubled the expectations,” the commissioner said about the outlets here. “The city is becoming a magnet for other businesses.”
  
  In the news release, Michele Rothstein, senior vice president of marketing for Chelsea Property Group, said the company is thrilled to support community growth.
  
  “The expansion of the center will enable us to enhance these benefits,” Rothstein said in the release.
  
  The opening date and list of stores will be announced at a later date, the news release said.
  
  Since the November grand opening, a Chili’s Grill and Bar has opened next to the outlets and a La Quinta Inn & Suites is under construction.

• Exciting Contests

• 

• Semana Santa 
  Semana Santa is Mexico's second most important holiday season of the year, behind only Christmas, and runs from Palm Sunday to Easter Sunday. In addition to attending Mass on Good Friday and Easter Sunday, many Mexicans will also take advantage of the holiday to go on vacation. If you're planning to visit the Rio Grande Valley during Semana Santa, make sure you check on hotel availability in advance.

• Rio Grande Valley Premium Outlets VIP Coupons click here
  Mercedes, TX  RGV Mercedes Outlet Mall

• Rio Grande Valley Premium Outlets in Mercedes, Texas

Comment:

I've written on the new Premium Outlet Mall in Mercedes, Tx a couple of times. The first post was on the day when the mall had just opened. Traffic was backed up onto US Highway 83 from so many shoppers wanting to go there. The second post was recently when my family and I went to check it out. Both posts have received a lot of traffic from the Internet. I am amazed that there is so much interest.

I do agree that if you are coming from Mexico and have the money available to spend on some of the high-priced brands, going to Mercedes is a much better option than travelling to San Antonio. I would go there simply to find the brands, but not necessarily to save money. In my visit to the shops, the prices were far from bargains. At least they aren't bargains like you find in San Marcos. But then, if you factor in the cost of fuel to travel to San Marcos from Mexico and the cost of a hotel, you come out even on cost and save time.

For many of us in the Rio Grande Valley, the shops are simply too expensive. I would go to Mercedes again if I REALLY needed something that I could not find in McAllen and price were not a factor. Fortunately for me, my wife does not find pleasure in owning expensive brands. It's funny, but when we want to save money, we go to Mexico to shop.

------------------------------------------------------------------------------------------------------------------------------------

In one year, sales tax receipts have increased by $2 million and property values have jumped by $100 million, city officials said.

Both increases are a result of one new business enterprise: the Rio Grande Valley Premium Outlets shopping center, which opened a year ago this Friday.

In just one year, residents have noticed the difference in the community.

“It’s had a tremendous impact on the city,” City Manager Ricardo Garcia said.

For many years, the city had little activity, business-wise, Garcia said.

“That was until Chelsea Property Group decided to invest in the city two years ago,” Garcia said.

Chelsea Property Group, the outlets division of Indianapolis-based Simon Property Group Inc., now owns more than 70 acres of land, said Michele Rothstein, senior vice president of marketing for Chelsea.

“We hope they are pleased with the economic benefits we have brought to the area, which includes tax revenue and jobs,” Rothstein said.

Construction is under way for the shopping center’s Phase II, bringing the number of stores to 140, Rothstein said. The expansion should be completed by spring 2008. However, mall managers will not release the names of the new stores just yet.

“But we believe shoppers will be very pleased with the enhanced collection of stores,” Rothstein said.

Resident Sandra Estrada said the added stores won’t only be a great place to shop, but will strengthen the community.

“The growth and revenue coming in will help people in the city find employment,” Estrada said. “That’s a great thing.”

Estrada said she has also noticed businesses being restored and wonders if that effect comes from the outlets. Finance Director Omar Gonzales said the city has seen a $2 million increase in sales tax revenue from fiscal year 2005-2006 to fiscal year 2006-2007.

Gonzales said the increase can be attributed to the outlets and the local businesses around it.

Garcia said with the opening of La Quinta Hotel three months ago and other commercial developments along Mile 2 East, the city is now looking forward to the next developments that could arise.

“We will continue working; we don’t want to focus on one project,” Garcia said. “We are moving forward and putting effort into other businesses, as well.”

Residents have also seen the changes the outlets have brought in the number of people who now stop in the town.

“Everything is busy,” resident Mari Moreno said. “Well, busier than before.”
Estrada agreed.

“It’s alive,” she said, with a laugh about the city.

Moreno said both the city streets and Expressway 83 are more congested than years before the outlet mall opened.

“I think once the construction on Expressway 83 is done, it will all be fine,” Moreno said.
Although Rothstein said it is premature to discuss future expansion, she did say there is room for a third phase if the outlets wished to expand again.

“Being a larger center will bring a larger critical mass of merchants, which will strengthen our position as a destination outlet center,” Rothstein said. “Everyone appears to be excited that the center is expanding so soon.”

Along with growth on the north side of Expressway 83, the city wants to concentrate on strengthening the downtown district.

The Mercedes Economic Development Cooperation is working to develop downtown businesses by offering grants to merchants, Garcia said.

“We want to make sure we provide for the local merchants,” Garcia said.

Along with the businesses, local services have also improved.

Garcia said the city has invested $8 million for a new public works building and fire department facility. Another $4 million will be spent on street paving, Garcia said.

“We’re able to do more things that we probably wouldn’t be able to accomplish two years ago,” Garcia said.

Moreno said she hopes to see street improvement from the newly acquired sales tax revenue.

“Especially the ones that are near schools,” Moreno said. “They need to be fixed.”
As the holiday shopping season approaches once again, Rothstein said she hopes to see crowds as large as last year when the shopping center opened.

“We are hoping to welcome large numbers of bargain hunters from throughout the Rio Grande Valley as well as Mexican nationals and area visitors,” Rothstein said.

---------------------

Mercedes is the premier retail hub of South Texas, as it is located at the center point of international commerce. Catering to consumer base of 10 million within a 200-mile radius, Mercedes receives over 7 million visitors annually. Mercedes has formalized a South Texas friendly attitude into a competitive business-friendly environment creating opportunities for growth and long term expansion. Due to an abundance of commercial and retail space and a wide variety of environmental characteristics, the community can accommodate nearly any operation, large or small. Behind the boom in retail is a large influx of visitors, specifically Mexican visitors and Winter Texans. Serviced by 7 international bridges and 3 airports, Mercedes welcomes tourists from Northern Mexico and Midwestern States year round. As part of the fastest growing MSA in Texas, the area provides a strong consumer base of 2.3 million within a 50 mile radius supported by a young dynamic population.

The Mercedes Retail Corridor is a 640-acre development anchored by the Rio Grande Valley Premium Outlets, opened in November 2006. The first phase of this Chelsea property is a $65 million, 400,000 square foot outlet mall housing over 100 tenants, including Nike, Coach, Burberry, Perry Ellis and many more. Rio Grande Valley Premium Outlets has quickly become the dominant shopping destination south of San Antonio. It serves not only South Texas consumers but also affluent Mexican-national shoppers from Mexico City, Monterrey, Reynosa and surrounding communities. The construction of phase II will provide an additional 150,000 sq ft with 45 outlets in the Fall of 2007 and plans are currently underway for phase III. Accompanying the Rio Grande Valley Premium Outlets is a La Quinta Hotel, Chili’s Restaurant, First National Bank and a 40,000 square foot home appliance retailer.

Already one of South Texas’ most popular destinations, the location, area growth and abundant work force continue to be the keys to attracting additional national franchises seeking sites for growth opportunities. The Mercedes Retail Corridor provides immediate highway access (US Expressway 83) with 80% of available properties fronting the expressway and will soon be serviced by a new $70 million international bridge in 2008. Currently Texas DOT is completing an $80 million expansion and renovation of US Expressway 83 providing additional traffic flow into Mercedes.