Valley River lands department store.

Byline: Joe Mosley The Register-Guard

Donna Green puts Valley River Center's newest tenant, Gottschalks department store, in with some pretty heady company.

"I would consider them the same as a Macy's, or a Meier & Frank," said Green, general manager of Albany's Heritage Mall, where a Gottschalks store has been in operation for a year.

"It's a nice, upscale store," Green said Tuesday. "And their customer service meets - almost exceeds - Nordstrom."

Gottschalks announced Tuesday that it has reached agreement to lease the current Macy's store in Eugene's Valley River Center after Macy's moves to a larger space in the mall next month.

"The Valley River mall is the top shopping destination in the Eugene marketplace, and it further strengthens our presence in Oregon, where we will have four Gottschalks stores once this store opens in the fall," company president and chief executive officer Jim Famalette said in a written statement.

Famalette and Gottschalks chief financial officer Greg Ambro both were traveling and unavailable for comment Tuesday. Questions about the department store's move to Eugene were directed to Rachel Albert of Financial Dynamics, a New York company that handles investor relations for Gottschalks.

"They are a regional retailer so, being on the West Coast, Oregon is one of their key markets," Albert said. "But they are not necessarily making a new push into Oregon - it's been for several years a key market for them."

Gottschalks, a 102-year-old company, blossomed from a 10-store operation in Central California to a regional chain of 60-plus stores after it became publicly traded in 1986. It still focuses on California, with 39 stores, but also has expanded into Oregon, Washington, Nevada, Idaho and Alaska.

Its current Oregon stores are in Albany, Grants Pass and Klamath Falls.

According to the company's most recent filings with the U.S. Securities and Exchange Commission, its merchandising strategy aims at offering "moderate to better priced brand-name merchandise" along with its own private labels. Gottschalks carries apparel, shoes and cosmetics from companies including Estee Lauder, Clinique, Calvin Klein, Ralph Lauren, Columbia and Levi Strauss, and home goods from lines such as Waterford, Krups and Calphalon.

"I think they're going to be good for the center," said Don Foster, general manager of Valley River Center. "I think they're going to look at the market's needs and try to position themselves between JC Penney's and Macy's."

Foster said he's had limited contact with Gottschalks officials, but believes they are "truly studying this marketplace" before determining the exact focus of the new store.

"They talk about getting to know and understand the retail environment here," Foster says. "You couldn't ask for anything better, from a landlord's perspective."

Jim Trench, manager of the JC Penney store at Valley River, said he knows little about Gottschalks but is pleased - for the most part - that another department store is coming to the mall.

"They'll bring more people into this mall, and that's always kind of a positive thing," Trench said. "In one sense, I say that's good. And in another sense, it's more competition."

Gottschalks will be subleasing the building from Macy's, whose own lease on the space at Valley River's northwest corner runs through 2021.

Kimberly Reason, a spokeswoman for Macy's Northwest, said her company leased the space to Gottschalks in part because the California chain is seen as more of a complementary retailer than one that would compete directly with Macy's.

"One of our priorities was to build the vitality of the mall and make it a very attractive destination for shoppers," Reason said. "We are pleased to have another retail anchor in the mall, and we believe Gottschalks will contribute to drawing additional traffic."

Macy's will close at its current Valley River location on May 6, and will reopen May 9 in the former Meier & Frank store - a 183,000-square-foot building - at the mall's southeast corner.

The shuffle was a result of the merger of Federated Department Stores, which owns Macy's, with The May Department Stores, which owned Meier & Frank. Eugene's Meier & Frank was one of 68 department stores throughout the nation that either have, or will be, closed because the merger would otherwise result in Federated owning two or more stores in the same malls.

Gottschalks' written statement indicated that the company hopes to take over the current Macy's store by midyear and to reopen it under its own banner by early fall.

Albert, the spokeswoman for Gottschalks' investor relations firm, said the company's stores typically range from 70,000 to 100,000 square feet, but it does have others the size of the Valley River property.

"They have stores that range very widely in square footage," Albert said. "While this store is a little bigger than their prototype, it's not by any means their largest store and it's not something they have no experience in."

The Albany store is just under 45,000 square feet, according to Green, the Heritage Mall manager. But Green said she's also visited a Gottschalks in San Luis Obispo, Calif., that is similar in size to the store's new Valley River location.

"It's a beautiful store," she said.

Joe Mosley can be reached at 338-2384 or jmosley@guardnet .com.