New LV home improvement retailer is targeting women

Phil Levine

Friday, Jan. 21, 2000 | 11:12 a.m.

The battle for the home improvement dollars of Las Vegans heats up Sunday with the opening of Lowe's Home Improvement Warehouse in Summerlin.

The nation's second-largest home improvement retailer hopes the store -- its first in the Las Vegas market -- will help establish a beachhead in America's fastest-growing community.

Located at 7550 W. Washington Ave., the big-box store marks Lowe's first retail outlet in metro Las Vegas. However, company officials say it won't be long before several other Lowe's stores open in the region.

"We're looking at other (Las Vegas) sites and locations to open over the next year," said Lowe's Vice President Brian Peace. "We just opened our first store in California in December, and we're planning a large western expansion."

The Wilkesboro, N.C.-based company plans to rapidly expand its presence in the Western United States; over the next two years, more than 100 stores are to open in the West and Southwestern regions.

Peace declined to identify the location of the company's next Las Vegas store. However, an industry source who ask not to be identified said Lowe's is preparing to close on property at the northeast corner of Warm Springs Road and Marks Street in Henderson.

Reflecting Las Vegas' around-the-clock lifestyle, the new Summerlin store will open at 5 a.m. Monday through Friday.

"We decide store hours on a market-by-market basis," said Peace. "Once we're open, we will look at the (Las Vegas) market and see if we need to extend the hours. It's possible that once we have multiple (Las Vegas) stores open, we may only need to have one store open 24-hours per day."

Given the abundance of home improvement retailers -- including industry leader Home Depot -- Lowe's hopes to establish its Las Vegas presence by catering to an often overlooked segment of the market: women customers.

"Our research shows that about 50 percent of home improvement customers are female, and our warehouse stores reflect our goal of attracting female shoppers," said Peace.

To that end, Lowe's Las Vegas stores will sell more than just traditional home improvement products.

"We'll have a large (store) section focused on home decor," said Peace. "As well, the look and feel of the stores -- wider isles, attractive colors -- is put together based on extensive market research."

It's a strategy that seems to be paying off for Lowe's and its investors.

"The company's been doing well as of late," said Mark Mandel, industry analyst with Atlanta-based the Robinson-Humphrey Co. Inc. "A strong housing market has helped them grow by between 20 to 25 percent each year over the last few years."

Mandel said Lowe's Western expansion is part of an aggressive corporate plan to go head-to-head with rival Home Depot in new markets nationwide.

"The company's been looking to expand outside its base region, using primarily the big-box warehouse concept," he said. "Their strategy of appealing to females as an important part of the market seems to work well. Their stores have a softer tone and they carry a range of home furnishings that seem to sell well."

Mandel set a 12-month target price of $65 per share for Lowe's stock; shares are currently trading in the $50 range.

The Las Vegas arrival of a major player in the home improvement sector may have repercussions for existing retailers.

"I'm not sure there's room enough for three major home improvement stores," said Matt Bear, retail broker with Colliers International's Las Vegas office. "The store that may be hurt by (Lowe's) arrival is Home Base. They haven't been expanding as rapidly as say Home Depot. (Home Base currently operates three locations in metro Las Vegas.)

"The fact is no one is likely to drive past one (home improvement) store to get to another one."

Not to be outdone, Home Depot plans to expand its Las Vegas presence this year; the company currently operates five Las Vegas-area outlets.

Home Depot plans to open another Las Vegas store at the southeast corner of Hualapai Way and Charleston Boulevard in March, said Kit Graski, retail broker with CB Richard Ellis' Las Vegas office.

"In addition, they (Home Depot) are also looking to add two more stores by the end of the year or in early 2001," Graski said.

Home Depot's Las Vegas expansion plans come as no surprise to Bear; he said Las Vegas presents an attractive market for home improvement retailers.

"In addition to all the product people buy for the new homes being built here, we have a significant amount of five to 10-year old homes that many people are looking to remodel," he said.

"The market is getting bigger, and all these (home improvement) stores are fighting for the same customer."