Threshold Resistance

Introduction

1.

From Pontiac to Ann Arbor

2.

Creating My Own Path

3.

The Golden West

4.

Evolution of the Arcade

5.

Creating 100 Percent Locations

6.

Buying the Ranch

7.

A Frosted Mug of Root Beer

8.

Minding the Store

9.

Fashion Statement

10.

Sold!

11.

Cookie Jars and Irises

12.

Selling Art and Root Beer

13.

Going Public

14.

The Best and Worst of Times

15.

Standing Alone

Photographic Insert

16.

United States of America v. A. Alfred Taubman

17.

50444-054

18.

Coming Home

Acknowledgments

Epilogue

Searchable Terms

Notes

About the Author

Credits

Copyright

About the Publisher

D
eveloping a regional shopping center requires the talents of many people. I can now say the same is true of writing a book.

I first want to thank Malcolm Gladwell, who I met in 2004, for giving me the inspiration to tackle this project and focus my story on the concept of threshold resistance. Christopher Tennyson, who has provided communications counsel to me and my companies for 23 years, helped me organize my thoughts and remember all the good and the bad. My longtime assistant, Melinda Marcuse, was a great fact-checker and sounding board. Helen Rowe patiently sorted through decades of photos, correspondence and news clippings. Each draft was constructively critiqued by my wife Judy and my attorney Jeffrey Miro (it takes a confident man to involve his wife and lawyer in the same project).

The enthusiastic Harper Collins team, headed by Marion Maneker, was indispensable, as was the skillful editing of Dan Gross. And my friend Mort Janklow skillfully guided us through the fascinating process of getting a memoir published.

Thanks also to Pauline Pitt and Tommy Kempner—the only two people nasty enough to publicly express their dislike for me during the most trying days of my life—for their unintended inspiration. Pauline was kind enough to describe me as a “pig” in the New York Post (actually, pigs are the most intelligent of all farm animals, with brains nearly the size of a human's) and Tommy sought me out personally at a dinner party to tell me how delighted he was that I was headed to prison.

In keeping with the spirit of the book, any profits I receive from its sale will be contributed to the University of Michigan ALS Clinic, where neurologist Dr. Eva Feldman and her medical research team are closing in on groundbreaking treatments.

Finally, I must single out my dear friend and partner Max Fisher, who passed away in 2005 at the impressive age of 96. Not a day goes by that I don't miss hearing from Max.

“T
his better work, kid. It's your ass if it doesn't.”

Strong words. Especially when you consider that they were directed at a twenty-four-year-old store planner by Milton J. Petrie, founder and chairman of the Petrie Stores Corporation. It was 1948, and I had just presented Petrie with an alternative plan for an apparel store he intended to build in Highland Park, Michigan, a close-in suburb of Detroit.

Petrie was a big wheel in retailing. Starting with a single hosiery shop in Cleveland in 1932, he had essentially invented the women's specialty store business in America and knew a good deal about how to design and build stores. By the time we met, he had hundreds around the country. What was wrong with the basic design his company had relied on so successfully? And what did a junior draftsman half his age at the Charles N. Agree architecture firm know that he didn't?

Here's what. The classic 5,000 to 6,000-square-foot Petrie store employed what we called a “deep throat” entry space bracketed by display windows. The front door was set in ten to fifteen feet from the sidewalk, which allowed the customer to view the merchandise leisurely in the windows before actually pushing the door open. Often, there was a glass-covered display island in this space as well. In theory, a shopper, protected in this initial U-shaped display space from the weather and the activity of the street, would enter the shop having already begun to make her purchase decisions.

That was the theory, anyway. But I didn't buy it. I may not have
owned any stores at the time, but I had been selling things—shoes, clothes, flowers—to people since I was a kid. I had studied design in college and had some experience in the field. And where Petrie saw a tried-and-tested recipe for retailing success, I saw an inefficient use of space; where Petrie's experienced store designers saw opportunity, I saw unnecessary barriers. First, the deep window displays robbed precious interior sales space. Second, the idea of retailing is to get people inside the store. And the distance from the sidewalk to the front door only heightened the odds against the customer ever coming into the air-conditioned space where the salespeople had a chance to assist. Third, it was an aesthetic mess. The sheer amount of display space was difficult and expensive to maintain in an attractive and imaginative way. Dressing store windows is an art.

Petrie Stores was a critical tenant for our client's three-store retail development, and I certainly didn't want to mess things up. (Our client was Ira Gumm of Alpena, Michigan, who happened to be Judy Garland's uncle.) But I had to communicate my point of view.

I had presented an alternative design that featured more shallow, see-through display windows and a welcoming front door on the sidewalk, closer to the property line. This would create significantly more sales space and turn the store itself—with its merchandise, human activity, and light in full view—into the display. Most important of all, in my design, far less stood between the customer and the goods, the customer and the salespeople, the customer and a sale!

“In short, Mr. Petrie,” I explained (we were not yet on a first-name basis), “we can eliminate much of the threshold resistance.”

“Threshold resistance,” he repeated slowly. “What do you mean by that?”

“The physical and psychological barriers that stand between your shoppers and your merchandise,” I explained. “It's the force that keeps your customer from opening your door and coming in over the threshold. I think we can reduce all that with this new design.”

What followed seemed like the longest period of silence in my life. Had I insulted this retailing icon? Had I jeopardized a leasing deal for one of my employer's most important clients? Come to think of it, who the hell did I think I was? All I could think about as Petrie stared at the blueprints laid out in front of him was how I was going to tell my fiancée that I had been fired.

But that's when those glorious words came out of his mouth: “This better work, kid. It's your ass if it doesn't.”

 

Y
OU
could say things worked out well. I kept my job at Agree, and Petrie Stores' Highland Park location became one of the strongest-performing stores in the chain, influencing future planning and design throughout the company. From that initial meeting, Milton Petrie and I developed a close friendship, which continued to the day he died, in 1994, at the age of ninety-two. In the intervening years, Milton was my neighbor in New York City and Palm Beach, one of the largest tenants in my shopping centers, and my partner in such business ventures as the Irvine Ranch and Sotheby's.

Our important encounter in 1948 also helped give me the confidence, after a short stint with the O. W. Burke construction company, to start my own real estate development business two years later. That enterprise, the Taubman Company, also worked out well. Over more than half a century, we have pioneered the development of shopping centers, transformed the nature and experience of luxury retailing, and created tens of thousands of jobs. Today, Taubman Centers owns and/or manages twenty-three large centers in the United States. If you've ever shopped at the Mall at Short Hills in New Jersey, or the Beverly Center in Los Angeles, or the Mall at Wellington Green in West Palm Beach, or the Cherry Creek Shopping Center in Denver, you've spent some time with us.

Developing unique retail environments certainly made me
wealthy—wealthier than I could have ever imagined. Equally important, it opened up a similarly unimaginable range of opportunities for me: to travel and see the world; to pursue my passion of collecting fine art; to meet and work with many of our time's leading entrepreneurs, businesspeople, artists, and civic leaders; to own a champion professional sports team; to get involved in businesses ranging from A&W Restaurants to Sotheby's; to contribute to the well-being of institutions and communities that made my career possible; and to create entities—buildings, companies, educational organizations—that will last far beyond my lifetime.

Now, the world surely doesn't need another book written by an older man telling how he became a self-made billionaire. In this country, and in this system under which we are blessed to live, it's relatively easy to make money.

So what's the point of this volume? Partly, it's that when you get to be my age, there's only so much golfing, fishing, and shooting you can do. Partly, it's to set the record straight and tell my side of the story after many years during which others—and frequently others who didn't know me or who intended to harm me—loudly trumpeted their versions of my life and career.

But mostly it's because I want to share what I've learned from my experiences. It's a safe bet most readers will never build a shopping mall or buy an auction house—or spend part of their retirement in a federal prison. Nonetheless, I've concluded that my experiences—my ups and downs, my gains and losses, my victories and defeats—allow me to offer some valuable perspective.

And looking back, it's clear to me that threshold resistance has been the key. In all my endeavors, in every chapter of my life, every relationship I've formed, every business opportunity I've pursued, every challenge I've encountered, every achievement I've enjoyed, threshold resistance has played a formative role.

It's always there, in business and in life. And it's not just about
store design. Every day, we encounter psychological, physical, cultural, social, and economic barriers. In order to accomplish anything, people have to find a way to get beyond the limitations they believe that personal background, conventional wisdom, common practice, or experience has placed on their imaginations. Threshold resistance might stop a customer from entering a hosiery store. But it might also stop a young woman from applying to medical school, or stop an engineer with a great idea from leaving the comforts of a job to start his own company, or stop a politician from seeking votes among a vital growing constituency. For everybody, being able to assess and overcome threshold resistance is nothing less than an essential life skill.

If there's one thing I've learned over the years, it's that to succeed, you have to look beyond immediate barriers and see opportunities. Successful entrepreneurs and builders possess a sort of serial vision that allows them to look past things as they are to see how they could be better, not just different—and hence more valuable. It means looking at a wheat field in a rural area and seeing a massive shopping center that will serve a large local residential population. It means looking at a huge ranch in Southern California and seeing one of the nation's most prosperous and valuable real estate markets. It means looking at a snooty, off-putting fine-art auction house and seeing an open, inclusive retail business. And it means looking at seemingly intractable problems—the persistence of low achievement in public education, the economic struggles of Detroit—and seeing the possibility for change.

Spend a few hours with me, and I'll tell you how I encountered and overcame threshold resistance. I can't promise that my story will help you make more money or be more successful in your career. This isn't that kind of book. But I can guarantee you will learn a great deal. I know I have.