Open-Air Shopping With the Works
Lifestyle centers are growing up with grand refinements. But there are also signs that developers are making more intimate connections to the regions they serve. Whether it be through inviting local retailers into the mix, adding parks or paying attention to design details, they are taking thoughtful steps to becoming a part of the heartbeat of the community.
There’s no more personal story than what’s emerging in Hammond, La.
Louisiana rebirth: Covington, La.-based Stirling Properties is getting started on Hammond Square, an 850,000-sq.-ft. retail project bringing exciting development to an area where people need a boost.
The effort takes down an existing 300,000-sq.-ft. enclosed mall, doubles the size of the property, does some fancy construction work around existing structures, and subsequently rebirths it as a combination power-and-lifestyle center complete with a Main Street. A few existing tenants—Sears, Dillard’s, Rite Aid, Chase Bank and an AMC Theatre—will remain intact and will be refurbished to suit the new look. Plans call for two additional department stores—Target and J.C. Penney—giving Hammond Square four department store anchors. The tenant mix will blend national retailers with local and regional merchants, hosting some 60 tenants in all, along with five restaurants.
Located north of Lake Pontchartrain, the Hammond area has become home to 15,000 Hurricane Katrina transplants. Overnight the population swelled, noted Stirling chairman James Maurin, who was born, raised and continues to reside in Hammond. “A portion of the New Orleans residential market has relocated to higher ground, while still maintaining an easy commute into the city.”
The Hammond Square project is very personal to Maurin.
“It is the largest retail project we have ever done,” he reflected, a significant statement considering Stirling’s 32-year history of development in the region. Maurin personally inspects the site daily as he passes enroute to his office. “We have a wonderful public-private partnership here between the city of Hammond and Stirling Properties. Doubling the size of the retail offering at this intersection created significant infrastructure needs, and Hammond provided that. I am proud of my hometown.”
Hammond Square will open in phases. Several new tenants will open this fall. The major portion of the lifestyle piece will open in spring 2009, with the development completed by fall 2009.
“It is the first combination power-and-lifestyle center we have done, and in the evolution of lifestyle centers, the shopping center industry is seeing more and more hybrids like Hammond Square,” said Maurin.
Mixing uses in Hampton, Va.: Mall Properties, New York City, is also showing it has long and deep ties to the communities in which it does business.
In Hampton, Va., it is driving the redevelopment of the Coliseum Mall, an enclosed shopping center that it built in 1973. “It is not a common thing—to do a second-generation project with the original owner,” said Howard Struletz, senior VP, leasing and development, for Mall Properties, who was working a summer construction job with Mall Properties when the center was first built.
In a partnership with Steiner + Associates of Columbus, Ohio, a firm known for its development of Easton Town Center, it is razing the Coliseum Mall and replacing it with the new Peninsula Town Center, a 1 million-sq.-ft., open-air lifestyle project.
“I like the fact that the new site plan provides for three parks and gives [the center] a real downtown feel,” said Struletz. Mall Properties has maintained civic ties to the community through the years; now it has established the Peninsula Town Center Community Foundation to benefit local charities.
Regarding the project itself, Justin Leyda, development manager for Steiner, said, “We have gotten rid of what didn’t work. Peninsula includes the best of everything we have done.”
What is working, Leyda said, is office space, and Peninsula will contain 100,000 sq. ft. “It works well with parking,” he said. “As the office workers leave, the evening shoppers and entertainment seekers come in.”
There will also be 160 residential units, above retail. “Residents will be able to look right into the town center. When there is a jazz festival, they can open their French doors and see it all happening,” said Leyda.
Peninsula Town Center will open in April 2009, although two existing mall tenants remain from the Coliseum—a Macy’s and a J.C. Penney that reopened in August. Peninsula showcases a new scaled-down format for Penney, from 200,000 sq. ft. to 100,000 sq. ft.
Along with a mix of specialty retail and restaurants, there will be a Barnes & Noble and a third department store. There is also a cinema, said Leyda, “and we are exploring more entertainment options right now.”
Main Street authenticity: In December, West Hartford, Conn.-based Developers Realty Corp., put the finishing touches on the 260,000-sq.-ft. retail, entertainment and shopping project—New Town Shops on Main—that it had begun two-and-a-half years ago. The New Town complex in Williamsburg, Va., also contains a relocated county courthouse, a performing-arts center, residential units and office space.
Williamsburg draws 7 million visitors a year to its numerous attractions, including historical sites, Busch Gardens, the Great Wolf Lodge and, of course, the College of William and Mary.
The typical tourist stay is three to four days, noted Joseph Baranowski, president and COO of Developers Realty Corp. (DRC). “We want to get them here on one of those days with our entertainment, shopping and dining in New Town,” he said. It was an attractive business objective for DRC, but it took great effort. It was also the firm’s first Main Street-type development.
To remain true to the historical feel, each building had to be individually approved by the James City County design review board, noted Baranowski. “Everything is done to minute detail. The Main Street traffic flows in one direction, the stop signs are not typical stop signs, and we probably spent more on the lighting fixtures here than on any other shopping center we’ve done.”
First, DRC built a 12-screen theater. “It was important for us to get the entertainment in,” said Baranowski, who noted that help from Consolidated Theaters was crucial to its success. “The county really wanted a theater to be part of the project.”
In front of the theater is a courtyard and fountain, and at the other end of the Main Street is a village green with a gazebo, where events and performances are held.
The 60 retail tenants include Barnes & Noble, Old Navy, Chico’s and Ann Taylor Loft, and restaurants include fine dining with Bone Fish Grill and Opus Nine Steakhouse and casual eateries such as Panera Bread.
“We are working to make it the most successful it can be for our retailers,” said Baranowski, who says the center is 90% occupied. “We ask them what they want to see more of.”
It takes a village: Casto Lifestyle Properties is dedicated to community enhancement. Even on its Web site, it poses the question, “Will our development serve a need in the community, and will the community embrace our vision?” Both are critical to Sarasota, Fla.-based Casto when deciding on a project.
Spurred by the success of its first lifestyle center—Winter Park Village in Winter Park, Fla.—Casto has put more mixed-used projects on its drawing boards, and at the same time is applying what it has learned.
Brett Hutchens, a partner at Casto, pointed to the redevelopment of the Randhurst Shopping Center, near Chicago’s O’Hare airport, into Randhurst Village. The project has moved Casto beyond its core Ohio, Florida and North Carolina market and into new territory. Rand-hurst Village also presents the developer with a delicate project that straddles introducing new while still maintaining a portion of the old. Some existing retail tenants—including a Carson Pirie Scott department store—will remain in place and stay open during construction, but have their looks updated.
Along with 100,000 sq. ft. of retail and restaurants, Randhurst Village will include a hotel, a movie theater and 200 apartment units. It is slated for completion in 2010.
There is also the ground-up creation of Park West Village in Morrisville, N.C., that will include a Main Street with retail and restaurants, a movie theater, residential units, parks and office space on a 100-acre site. It has a spring 2010 opening planned.
A combination power-and-lifestyle center, Park West Village will have apartment units above retail as well as freestanding units. “It is a really good apartment market. There is a lot of job growth,” said Hutchens. Park West Village will also have a hotel.
“We are seeing more hotels that are desirous of being in these properties and they are a very synergist use,” explained Hutchens. “Hotels are low parking-intensive and they bring 150 to 200 new people everyday.” For travelers, “It is convenient to be able to step out of your room and have a meal or go the movies.”
On the Avenue: It’s hard to know if Atlanta-based Cousins Properties set out to create a retail shopping center brand, or if it just turned out that way. Regardless, the brand has been established—in the form of The Avenue.
Avenue Forsyth, currently under construction in the Atlanta suburb of Cumming, Ga., is Cousins’ eighth project to carry the banner.
Attractive because of its high-income residents and ideal crossroads location—at the juncture of State Highway 400 and Peachtree Parkway—Avenue Forsyth has allowed Cousins to add a major office component to a development for the first time. There will be 70,000 sq. ft. of office.
“[The project] is driven by this trade area. We are bullish on the office piece,” said Kevin Polston, project director, Cousins. “We took no pre-construction commitments.” Tenants are likely to include small businesses owners and professional offices such as financial firms, pediatricians or dentists.
The first phase of Avenue Forsyth opens in a few weeks—April 30—complete with 470,000 sq. ft. of retail and dining. The center will contain some 100 retailers and 11 restaurants, with more eating places expected to be added. Cousins likes to have consistency with key national retail tenants including Jos. A. Bank and Chico’s. “But we also like to bring in some local flavor,” said Polston. Avenue Forsyth will feature Surf Town, a surf and skate shop, Natural Body Spa, a regional spa and Little Azio, a popular neighborhood Italian restaurant. “There are eight or nine purely local concepts. I am proud of this,” Polston said.
Phase II will take on another 50 acres of development that will be completed in 2011.
For pedestrian safety, Cousins has added passive speed controls—changes in elevation of sidewalks, and bumps in the road. There are also shifts in road materials that subconsciously make drivers slow down. “On the technical side, we also tweaked our parking in this project,” said Polston. “We have three rows of head-in parking, to accommodate six cars across.”
Of utmost importance is maintaining a close feedback loop with retailers, he said. “Our mission is to provide a conduit for retailers to reach customers. We try to find opportunities to provide a place for retail.”
Lampert, the Eli Manning of retail?
HOFFMAN ESTATES, Ill. The New York Giants triumph over the highly favored New England Patriots in the Super Bowl earlier this month, has become an example of coming from the bottom to win it all. Sears Holdings chairman Edward Lampert is one of the latest to use the Giants win, even going as far to compare himself, and the leaders of his company, to quarterback Eli Manning.
The Giants analogy, and Eli Manning comparison, is applied mainly to the company’s Kmart division. In a letter to investors, posted on the Sears Holdings investor relations Web site, Lampert said during Kmart’s bankruptcy in 2002, the unit was “like an undrafted free agent who nobody thought had a chance to play in the big leagues.” Lampert went on to say, “Like Eli Manning, we know what it’s like to be underestimated and questioned, but we intend to keep working on our game to achieve our full potential.”
Sears Holdings reported net income of $426 million, or $3.17 per diluted share, for the fourth quarter ended Feb. 2, compared with net income of $811 million, or $5.27 per diluted share, for the fourth quarter ended Feb. 3, 2007. For the fiscal year ended Feb. 2, 2008, net income was $826 million, or $5.70 per diluted share compared with net income of $1.5 billion, or $9.58 per diluted share, for the fiscal year ended Feb. 3, 2007.
Circuit City investor seeks to replace board
RICHMOND, Va. Circuit City Stores today acknowledged that it has received two proposals from shareholder Wattles Capital Management regarding its board of directors. Wattles holds approximately 6.5% of the outstanding shares of the company’s common stock.
Circuit City reported that Wattles proposed the idea of replacing the company’s Circuit City 12-member board of directors with its own nominees. Circuit City said its board of directors will review carefully the shareholder’s proposals and the qualifications of the nominees in accordance with its fiduciary duties, mindful that the proposal would give the shareholder absolute control of the entire board, which would be disproportionate to its relative ownership of the company’s shares.