Focus on: America’s Top Redevelopers
In November 2009, Chain Store Age’s coverage of the prior year’s redevelopment highlights was particularly significant. Because, while our redevelopment coverage from 2005 to 2008 served as an adjunct to stories about new projects, in 2009 redevelopment was the only news coming out of the retail real estate world.
Ground-up development had all but stopped, and the nation’s shopping center owners turned their collective focus to freshening existing properties.
Our November 2010 story is no different. New builds are still sketchy, and redevelopment is all the rage.
In our sixth annual ranking of the country’s top redevelopers, just as in years past, we have tried to make the selection process as objective as possible. That’s not easy. As has been the case over the last five years, not enough information is available to formulate a totally foolproof ranking system. Only a handful of developers report financial investments in redeveloped projects, and many tally redevelopment square footage in differing ways.
To be fair, we have listed our top 10 in alphabetical order, sending a message to the retail community that these developers share an active and admirable commitment to redevelopment—and no one company can really be objectively ranked higher than the next.
Centro Properties Group New York In 2009, Centro redeveloped eight projects to the tune of about $125 million. The New York City-based developer expanded a Kroger store and added retail to Merchants Park in Houston, and added a Walmart Supercenter to Wabash Crossing, in Wabash, Ind. But the company points to a shopping center in Fairview Park, Ohio, as its most significant redevelopment project of 2009. Centro razed the formerly enclosed, circa-1954 Westgate Mall and reformatted it as an open-air lifestyle center, featuring prime anchors, junior anchors, specialty retailers and restaurants. The 501,406-sq.-ft. Westgate is tenanted by a lineup of major retailers.
Kimco Realty Corp. New Hyde Park, N.Y. In Philadelphia, Kimco’s redevelopment of the Cottman & Bustleton Center, a 332,583-sq.-ft. grocery-anchored site, was completed in 2009. The site, which is 98% leased, features a 137,000-sq.-ft. Target, a 67,000-sq.-ft. Pathmark and 21,000 sq. ft. each for Pep Boys and PetSmart. With community support, Kimco removed an outdated multiplex movie theater and in-line retail to accommodate Target. The success of this urban redevelopment involved cooperation from both PetSmart and Pep Boys, who allowed Kimco to move them within the site as Kimco worked around space constraints to accommodate the Target store.
Levin Management Corp. North Plainfield, N.J. Of its three redevelopments of 2009, Levin cites the $15-million-plus overhaul of Post Road Plaza in Pelham Manor, N.Y., as its weightiest of the year. Levin repositioned, re-tenanted and renovated the 268,000-sq.-ft., 50-year-old shopping center, creating hundreds of construction-related and permanent jobs and introducing the iconic Fairway Market as its new 75,000-sq.-ft. grocery anchor. Longtime tenant Modell’s Sporting Goods expanded into a 22,000-sq.-ft., two-story space, and a carefully conceived re-tenanting effort brought the property back to its original roots as a dominant community-oriented center with a value-oriented retail mix.
Macerich Co. Santa Monica, Calif. A regular on Chain Store Age’s Top Redevelopers list, Macerich redeveloped two projects in 2009, the largest being its 710,000-sq.-ft. Northgate Mall project in San Rafael, Calif. But its most significant—according to Macerich—was its redevelopment of Scottsdale Fashion Square in Scottsdale, Ariz. The center, known for consistently introducing first-to-market retailers to the Arizona market, took advantage of an anchor recycling opportunity to bring a first-to-market Barneys New York as the center’s fifth department store, in addition to 18 new in-line shops through a 170,000-sq.-ft. expansion. The two-year-long project also included two levels of new underground parking and a new look that keeps with its standing as a high-end, super-regional retail flagship center.
NewMark Merrill Cos. Woodland Hills, Calif. New to the Top Redevelopers list this year, NewMark Merrill invested approximately $18.6 million in 2009 to redevelop three projects. For Whittier & Painter in Whittier, Calif., the company assembled three parcels, negotiated with anchor tenant Big Lots to adjust its lot line in order to expand the center, and added a Fresh & Easy store. NewMark Merrill developed a 15,000-sq.-ft. building to bring the total GLA to 50,000 sq. ft., and incorporated new signage. Cost for the redevelopment was $2.8 million.
Pennsylvania Real Estate Investment Trust (PREIT) Philadelphia Of its four major redevelopment projects in 2009, none was more significant than PREIT’s complete renaissance of Cherry Hill Mall in Cherry Hill, N.J. PREIT invested $218 million to transform the 50-year-old mall—the first enclosed shopping center east of the Mississippi River—with multiple first-to-market specialty retailers and exclusive restaurants that worked to establish the Philadelphia metro area’s premier high-fashion shopping and dining destination. Major tenant additions included Nordstrom, The Container Store and Crate & Barrel, as well as a Maggiano’s Little Italy and Seasons 52 restaurant. The project was completed in March 2009, and in just the first 12 months post-completion, more than $100 million in additional sales was generated by the new restaurants and new and expanded retailers.
Simon Property Group Indianapolis Simon invested $129 million in 2009 to expand two of its centers, redevelop one and renovate four, but the country’s largest shopping center developer said that, of the 1-million-plus sq. ft. impacted last year, it considers its redevelopment of Florida Mall in Orlando, Fla., its most significant. Simon created a lifestyle addition on the site of a former Lord & Taylor department store and added three exciting retailers to the shopping mix—H&M, Forever 21 and Zara. All opened in November 2009 in advance of Black Friday.
Stirling Properties Covington, La. The town of Hammond, La., may fly below the national radar, but Stirling Properties’ redevelopment of Hammond Square Mall into an 850,000-sq.-ft. power-and-lifestyle combo called Hammond Square is anything but low-profile. Power anchors include J.C. Penney, Dillard’s, Sears, Target, T.J. Maxx, Best Buy, Ulta and Academy Sports. Lifestyle anchors that dot a Main Street shopping environment include Books-A-Million, Rite Aid, Encore Shoes, AMC Theatres and several restaurants. This revitalization of an outdated, functionally obsolete, enclosed mall into a modern, open-air shopping hybrid was no easy feat. Stirling had to raze the central portion of the two-level mall while allowing minimal disruption to existing businesses.
Westfield LLC Los Angeles Westfield considers its redevelopment of Westfield Culver City in Culver City, Calif., its most significant of the year, as Westfield spent $180 million to add 330,000 sq. ft. of new shop space housing Target and Best Buy as new anchors, Gold’s Express Gym and fashion retailers such as H&M, XXI Forever, Coach, G by Guess, Hollister and Express. A new lineup of full-service restaurants and an architectural overhaul that included new entrances and exterior facades, new tile and fixtures and upgraded landscaping and customer amenities resulted in a whole new appeal for the 1,056,651-sq.-ft. shopping center, which opened in October 2009.
WS Development Chestnut Hill, Mass. WS Development redeveloped 366,751 sq. ft.—four properties in all—in 2009, and the company points to its major renovation of Chestnut Hill Shopping Center in Chestnut Hill, Mass., as its most significant. The project included a complete redevelopment of Star Market and the addition of 5,700 sq. ft. of new retail space. The new two-level Star Market includes an energy-efficient design featuring LED lighting and a hydrogen fuel cell that provides 90% of the building’s electricity, plus all of its domestic hot water, heat and air conditioning.