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Dillard's Helena

Customers walk through the Capital Hill Mall Dillard's in 2018.

It didn't take long for the old Herberger's space at Southgate Mall in Missoula to get a new tenant.

The mall announced Wednesday that construction has begun on a remodel that will allow Dillard's to expand to the space.

Dillard's is already an anchor store in the mall and the project will simply expand the store's offerings into more space. Herberger's closed its Missoula location last August following a national bankruptcy and company-wide liquidation sale.

“We had confidence that valuable space would not remain dark for long,” said Tim Winger, general manager of Southgate Mall. “That location is tied to an area we call our ’50-yard line’ with dozens of community events occurring nearby throughout the year."

Dillard's is one of the nation's largest fashion retailers with annual sales of over $6.2 billion, according to government filings. It has more than 290 stores in the U.S.

Lou Conforti, CEO and director of Washington Prime Group, Southgate Mall’s parent company, said in a press release that he wants to establish the mall as a dominant town center.

“I have previously espoused the virtues of Dillard’s as a consummate merchandiser for the simple reason they understand and, as importantly, respect the demographic constituencies which they serve," he said. "We expect more of the same as they expand into their second location at Southgate Mall, which serves the City of Missoula, as well as western Montana.”

Last year, a new AMC nine-screen, dine-in movie theater and organic-focused Lucky's Market grocery store opened in the mall.

Washington Prime bought Southgate Mall from local ownership for $58 million in February 2018. 

In 2015, the Missoula Redevelopment Agency approved a request to apply $6.9 million in tax increment financing to help build a new road, an extension of Mary Avenue between Brooks and Reserve, which directed much more traffic through the mall property. The money will be paid back by what city officials estimate will be more than $320,000 a year in new property taxes, which are diverted away from the city's general fund and put back toward the property, since it sits in an Urban Renewal District.

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