Startup Retailer Makes US Debut With Drone Training, Coding Classes for Kids in Former New Jersey J.C. Penney
A large mall in New Jersey has found a new kind of tenant to lease part of a former big-box J.C. Penney space: a store focused on classes, activities and products related to science and technology.
Arena STEM opened its first permanent U.S. location at the Westfield Garden State Plaza mall in Paramus, New Jersey. Arena STEM, looking to open additional stores across the nation, is leasing 20,000 square feet at the former site of a J.C. Penney at the mall. The 177,000-square-foot department store closed in March 2018.
Arena STEM is a prime example of so-called experiential retail, or tenants that provide customers services or experiences that can't be had online. Those are the kinds of occupants that generate foot traffic at a brick-and-mortar center, and as such can be a boon to mall landlords trying to go beyond just filling retail vacancies.
Arena STEM is unique in its focused strategy, according to a company executive, as an indoor amusement center offering seven interactive play zones and a variety of science, technology, engineering and mathematics — or STEM — activities, workshops, toys and hobbies.
"We're probably the only open STEM center for the general public. ... We bring families," Lenny Lozinsky, one of Arena STEM's principal partners, told CoStar News on Wednesday. "We're bringing people to the mall."
But there are potential competitive challenges. Other companies such as Dave & Buster's provide parts of what Arena STEM offers. American Dream, the mega entertainment-and-shopping venue in East Rutherford, New Jersey, offers not only a variety of activities for kids and families but also product demonstrations at its new Toys R Us store. And at this juncture, Arena STEM needs investors to keep growing, Lozinsky said.
Arena STEM describes its Paramus location as an education, entertainment and retail center, and those sectors provide its three sources of revenue. It's a place where children, youths and their families can receive drone training and learn about robotics and computer coding, among other things. The company's retail selection includes a variety of smart toys, construction sets and hobby-grade models, including those with artificial intelligence and machine learning.
"We're not a Disneyland," Lozinsky said. "We're basically educational entertainment."
The Arena STEM concept began at a site in Moscow, according to Lozinsky. The business was slated to open a site at the Palisades Center mall in West Nyack, New York, but then the pandemic broke out in 2020. Instead, Arena STEM leased part of a former Uniqlo store at Garden State Plaza as a temporary pop-up site for about a year before relocating to the former J.C. Penney space, Lozinsky said.
The company has been exploring sites in places such as California, Connecticut and Pennsylvania, seeking locations that are 15,000 to 20,000 square feet.
The new site at Garden State Plaza has more attractions, including a new virtual reality pavilion, a state-of-the-art DJI RoboMaster Battlefield, an expanded drone field, a larger aqua zone and a renovated on-road car drift track. Arena STEM also has dedicated classrooms, as well as a large room that can accommodate birthday parties and private events of up to 100 people.
Children age 2 to 6 can learn computer skills in a specific zone while playing with screen-free smart toys, preparing them for future block-based coding using Scratch and interactive programming in Python.
For school-age customers, Arena STEM is expanding its selection of classes and workshops, including after-school enrichment and vacation programs in science and technology. The facility also plans to add workshops on basic financial literacy, and it will be able to host school trips and summer camp programs.