Malls stalking dollar-rich tourists

NEW YORK (CNNMoney.com) -- Shopping malls are rolling out the red carpet for dollar-rich holiday tourists from the United Kingdom, Europe, Canada and elsewhere by offering them VIP treatments, such as limo rides with Champagne and in-store refreshments.

The dollar's value is languishing, and cash-strapped Americans are expected to spend less on holiday merchandise this year. Those two factors are spurring several mall operating companies to aggressively court lucrative international customers in a bid to pump up crucial holiday sales.

Japanese shoppers embark on a package shopping trip to the Desert Hills Premium Outlets in California.

Macerich is offering overseas shoppers a "VIP experience" shopping trip, complete with a limo ride and Champagne.

According to industry estimates, 2007 holiday sales are expected to rise to $474.5 billion or 4 percent, softer than last year's 4.6 percent increase.

"Our Canadian business has clearly been significant this year. We do love the loonie," said Michelle Rothstein, senior vice president with upscale mall operator Chelsea Property Group, a division of No. 1 mall operator Simon Property Group (Charts).

Rothstein said Chelsea outlet centers in upstate New York, Minnesota and Seattle have seen an influx of Canadians indulging in heavyduty shopping sprees.

The dollar's weakness against the Canadian dollar, euro and pound has made shopping in America a bargain for tourists, while Americans are having to dig deeper to travel and shop overseas.

"This holiday season, we have stepped up our efforts in marketing overseas and we've increased the number of shopping packages being introduced with tour operators," Rothstein said.

Foreign travel agents have been busy arranging shopping trips to U.S. malls for Black Friday and over the holiday season, Rothstein said.

"Tour operators, especially in the U.K. and Ireland, have told us that pre-purchase excursion tickets for holiday shopping to centers like our Woodbury Common premium outlets are selling well," she said.

For its part, Rothstein's company is providing the international shoppers with buses and special coupon books, Rothstein said. "Some of the shoppers don't speak English. So we also provide them with translators," she said.

Rosemary McCormick, a consultant with trade association Shop America Alliance, said she expects a big spike in tourists shoppers to the United States.

"The Canadian dollar is at par with the U.S. dollar and the pound is about twice as strong as the dollar. This mean that America is a 2-for-1 sale for tourists," McCormick said.

She said the United Kingdom is the top source for tourist shoppers to the United States.

Forecasting firm Global Insight expects total tourist traffic from the United Kingdom to surge 6.5 percent in the second half of 2007, compared to the same period last year, while visitors from Ireland will increase by 10 percent.

"You've got to believe that this momentum is [in part] driven by exchange rates," said Ken McGill, Global Insight analyst of travel and tourism.

"Shopping tour operators in London are actually telling people to bring empty suitcases and do all their shopping once they get here," said McCormick.

That's certainly not a problem for Kate Cavaliere, senior manager of tourism for the Macerich Company (Charts), which operates 73 shopping centers nationwide.

"We're ready for a jump in international shoppers this year because of the favorable exchange rate," Cavaliere said, adding that United Kingdom, Mexico and Canada are likely to lead the charge. In some Macerich malls, tourist traffic has accounted for 30 percent of total shopper traffic so far this year.

"We're collaborating with hotels and resorts to offer these tour groups shopping and dining incentives in our stores and restaurants," she said.

Macerich's other red carpet programs for its overseas customers include the "VIP experience" and the "Euro chic tour."

"U.K. and European visitors like high-end brands, and they are buying more of them here because they are less expensive," Cavaliere said. For this clientele, the company is offering free limo rides, complete with Champagne.

"We take them to specific luxury retailers in our malls." said Cavaliere. "Some of these retailers give them special shopping hours with refreshments."

Lucia Plazas, tourism specialist with Taubman Centers's Dolphin Mall in Miami, said the mall is getting e-mails every day from visitors coming from Europe and Latin America asking how to get to the mall from Miami Beach.

"Brand names like Polo, Nautica and Coach are a big attraction for tourists," she said.

To maximize the number of international visitors, Dolphin Mall has increased the frequency of shuttle buses from Miami International Airport to and from the mall during the weekends, Plazas said.

"We're also adding more advertising about our mall to shoppers coming from Argentina, Colombia and Chile," she said, adding that the special incentives will be valid until Dec. 31.

The influx will add to the usual holiday crowds in popular shopping cities. "The reason you won't get a hotel in New York or any of the major cities over the holidays is because of all these tourists coming here to shop," said McCormick of the Shop America Alliance.