Area malls attract industry’s attention
Justine Griffin/Sarasota Herald-Tribune
After several recessionary years during which Southwest Florida retail development stalled, new projects are sprouting or being planned that will dramatically change the region’s retail landscape.
Perhaps the best example already is taking shape at University Parkway and Interstate 75.
A joint venture between a Michigan developer and Benderson Development Co. is building the Mall at University Town Center, a $315 million center that will be the region’s largest shopping hub when completed in October 2014.
The mall’s first incarnation came in 2005, before the Great Recession prompted then-anchors Nordstrom and Neiman Marcus to reconsider and progress was shelved.
But the project resurfaced two years ago with a roster of anchors that includes Saks Fifth Avenue, Macy’s and Dillard’s department stores.
The 880,000-square-foot mall, along with hundreds of other projects nationwide, will be featured next week at an annual industry gathering in Las Vegas that showcases trends and emerging retail concepts.
The International Council of Shopping Centers is the largest conference of developers and merchants nationwide, and this year — unlike recent meetings — is sure to be brimming with new malls and redevelopments.
“Just the enthusiasm I’m seeing in the industry right now shows that more people are getting behind new projects,” said Dale Scott, a former ICSC director for Florida and now an executive with Hawkins Construction, a Tarpon Springs contractor whose work locally includes the new Publix Super Market on Longboat Key.
“We have more projects in planning right now than we’ve had in the last five years,” Scott said.
In all, 30,000 retail industry professionals will converge on Las Vegas for the five-day gathering, aiming to sign leases and expand properties and portfolios buoyed by a renewed housing market.
“From the activity I’ve seen surrounding the conference so far, it tells me that there are a lot of deals to be made,” said Jeff Green, a retail analyst and head of Phoenix-based Jeff Green Partners, a consulting firm. “It also tells me that ecommerce is not having as great of an impact on brick and mortar as feared, otherwise there wouldn’t be so many people looking to do brick and mortar leases and deals.”
In the spotlight
While University Town Center will likely garner the most industry attention, it will by no means be the only Southwest Florida project in the spotlight.
• This year will be a pivotal one for Sarasota’s Southgate Mall and owner Westfield Group, the Australian mall operator that also owns Sarasota Square Mall.
This will be the first year since Saks officially said it would be leaving Southgate in favor of University Town Center, possibly taking so-called in-line tenants like Williams Sonoma and Pottery Barn with it.
In response, Westfield has floated a number of redevelopment concepts, including converting the mall into more of an entertainment-dominated lifestyle center.
This year’s ICSC meeting also marks the first since New York-based real estate firm O’Connor Capital Partners bought 49.9 percent interest in six of Westfield’s Florida malls in March, a deal that included both Sarasota properties.
• Mason Asset Management, a New York-based investor and relative newcomer to Southwest Florida’s retail scene, will be looking to fill the ailing 678,377-square-foot Desoto Square Mall, in Bradenton, which has struggled to retain some tenants.
Mason bought the mall for $24.6 million from Simon Property Group in late 2012, a significant discount to its perceived value that should allow the investor to refurbish the mall.
But since then, Mason has done little to transform the property beyond regular ads noting leasing opportunities. The mall, which originally opened in 1973, is anchored by Macy’s, JC Penney, Sears and Desoto Dollar Movies, among others.
For DeSoto, this ICSC convention could be make-or-break, and determine whether the property will be able to transform itself into a more value-oriented center to meet local residents’ shopping needs or continue to wither.
New or transformed projects aside, several area developers also are expecting the ICSC gathering to be a lucrative place to show off recent activity.
Lakewood Ranch-based Casto Lifestyle Properties, for one, has been busy with new projects since 2011 — though none are in Southwest Florida.
Brett Hutchens, Casto’s partner in charge of the company’s Southeast U.S. retail developments, said his firm has developed more than 2 million square feet since 2011.
In Panama City Beach, Casto is developing a $46 million project known as Pier Park North, which is scheduled to open in spring 2014. It is also working on adding a 216-unit, $34 million apartment complex to its Winter Park Village outdoor shopping and dining plaza. The complex broke ground in April.
“We’re certainly busy and our hands are full in quite a few projects in Florida,” Hutchens said. “We have a full flight of meaningful meetings in Las Vegas that are either about developing properties or with companies we’ve developed with before, even some future developments for 2014 and 2015.”
Locally, Casto is best known for developing the Whole Foods Market Center and the 100 Central retail and condominium complex in downtown Sarasota.
Analysts believe that, like Casto, developers and merchants also will use the ICSC meeting to plan ahead for projects and openings.
Benderson and Taubman, for instance, are expected to meet with a variety of merchants for University Town Center and other projects.
“There is a pent-up demand for retailers needing space and space in good locations, especially in Florida,” said Scott, the Hawkins Construction executive.
“Many want to build and expand into Florida for the first time,” Scott said. “Vegas is the place where those deals will be made.”