MANY UNDERPERFORMING properties are in need of a wake-up call and a new lease on business.As these examples in Florida, Pennsylvania and Texas illustrate, smart renovations can help turn around even the most dismal of retail centers.
Owners of old, underperforming malls and shopping centers may be tempted to convert them to different uses, sell them, or even scrap everything and start all over again. But the following examples of successful renovations show that taking such drastic steps isn't always necessary.
Fla. dowager gets more than a facelift
The redevelopment of Northridge Shopping Plaza is a dramatic example of how a declining retail property was transformed into a thriving South Florida destination. The 25-year-old strip mall was originally built for a discount department store, supermarket and drug store. The developer was The Lefcourt Group of Miami.
Located at one of Oakland Park's busiest intersections in Fort Lauderdale, the one-level strip center has a strong demographic profile.
Lefcourt's redevelopment plans called for assembling five separate parcels, including the existing 175,000-sq.-ft. center and four other tracts along a major street, to achieve a new 250,000-sq.-ft. upscale retail expansion on 20 acres. Most of the original center was demolished, paving the way for new construction.
“In recent years, as anchor tenants required more space, the discount department store was induced to leave, allowing larger stores and two junior anchors to be added,” says architect Larry Levinson, principal of Levinson Associates L.P. in Houston. “Through an elaborate phasing plan, the old center was partly demolished, with leases terminated in favor of national tenants paying higher rents, and some tenants relocated to newly renovated space. By eliminating the department store and creating new building elevations, the project attracted a new retail mix, including a supermarket, fitness facility, six restaurants and a discount department store.”
The most challenging task was maintaining operations during construction. Levinson worked with management and retailers to ensure tenants were not adversely impacted and that public safety was maintained. Barricades of painted plywood provided safe passage through parking areas to operating businesses. Levinson even designed windows in the barricades to let in light and give patrons a glimpse of the new spaces.
The site plan and elevations were important in attracting national tenants. To increase roadside visibility, 42- to 58-ft.-high facades identified major tenants and 24- to 36-ft.-high parapets for remaining shops. Cornices created a massing effect with varying roof levels, resulting in separate identities and individual entries for each store, linked with a covered promenade. A palette of high-end, traditional materials with natural finishes reflects Florida architecture, along with enhanced lighting and lush landscaping. A lightweight Exterior Insulation Finish System (EIFS) creates new shapes and forms, along with natural stone, to raise the design profile.
The developer worked with local officials during the project to enhance community relations and increase value to the neighborhood. Installation of 16-footcandle exterior lighting improved security and attracted nighttime shoppers.
As a testament to the center's success, redevelopment enabled the area's dominant grocery chain to both occupy a space twice as large as its other stores and triple sales. Northridge Shopping Plaza was initially acquired with a net operating income of less than $1 million, but by the end of 2001, the center was 93% leased, with an estimated $3 million operating income and more than $3.6 million is anticipated at full occupancy. Total redevelopment cost, including acquisition, was $30 million.
“The lessons learned are to spend the extra money needed to make the project better than any other center in the area because it pays off in the long term,” says Levinson. “A developer will receive higher rents, better tenants, permanent financing at lower interest rates and a successfully operating center during an economic downturn. Our client had the vision and creativity to demolish and rebuild rather than do a facelift. We reinvented Northridge to meet tenant needs and marketing opportunities.”
New life for old department stores
Wynnewood Center was a premier destination when it opened in 1954, in Wynnewood, Pa., on Philadelphia's upscale Main Line. The original center had 11 stores including a supermarket, a John Wanamaker and a Bonwit Teller.
By the time Federal Realty Investment Trust purchased Wynnewood Center in 1996 for $17 million, Wanamakers and Bonwits' stores were long vacant and so was the center's former cachet.
“When we acquired Wynnewood, we saw a prime property with untapped income potential,” says Chris Weilminster, vice president of anchor tenant leasing for the Rockville, Md.-based REIT. “There were two vacancies and a tenant mix inconsistent with community needs,” he says. “Based on the strong local retail demand, the vacancies provided opportunities for property repositioning, dramatically increased returns on investment and offered the community a revitalized, architecturally appealing shopping center.”
In addition to a faÇade upgrade and renovation, several national tenants signed on, such as Old Navy, Bed Bath & Beyond (BBB), Borders Books and Music and a new 98,000-sq.-ft. supermarket.
“We had to renovate because Wynnewood Center no longer met the needs of today's tenants,” says John Tschiderer, Federal Realty vice president of redevelopment. “Buildings had individual internal vertical circulation but were not connected to each other. Two antiquated stores had to be made more marketable. We integrated existing buildings with below-grade services at the old Bonwit Teller building, through a loading dock and tunnel serving two three-story buildings and three primary tenants.”
Federal Realty hired consultants, including Brown & Craig Architects of Baltimore, and managed the redevelopment design, construction and leasing. The 200,000-sq.-ft. renovation spanned from 2000 to October 2001, at a cost of $14 million. Materials included indigenous local stone — mica schist — for durability and a rich look. The makeover included new entry and parking lot facades, along with new graphics and signage.
The design solution included new entries for two tenants on opposite sides of the old Wanamaker building. One entry for the ground-level supermarket faces Cloverhill Road. BBB occupies the second floor, with a 4,000-sq.-ft. grade-level lobby access, and a Vermaport escalator, accommodating pedestrians and retailer carts. The BBB lobby and parking face busy East Wynnewood Road, providing both anchor retailers with separate identities, parking lots and storefront facades, all from the same building. Borders is on the first and second floors of the old Bonwit building. A day spa is in the back.
Renovation plans attracted tenant interest. In addition to the new anchors, the diverse mix includes Genuardi's, a U.S. Post Office and mail handling facility, Millennium Hair & Day Spa, First Union Bank, Delancey Street Bagels and more.
The challenge to the owners was integrating multilevel tenants and making sure retailers and the community liked this mix. With a new look and national retailers in place, Wynnewood proved quite successful. “As of early 2002, the 7.5% return on capital was 16.8%, indicating a successful investment,” says Tschiderer. “A once dowdy, dated asset is now a first-class retail environment.”
From 70s sprawl to Versailles
Clear business and design concepts raised the profile and profitability of a once ordinary Hurst, Texas, retail center. The Northeast Mall is a single-level enclosed mall in northeast Tarrant County's Dallas/Fort Worth area. Located on prime property at a major highway intersection, the mall was built in the 1970s, and marketed toward a lower-end clientele.
“The renovation goals were threefold: to expand the market toward an upscale demographic, maintain the existing customer base, and provide character and vitality,” says architect Randy Stone, vice president of RTKL in Dallas.
At the same time, both Nordstrom and Saks Fifth Avenue were seeking locations in fast-growing Tarrant County. The renovation had to reflect high quality to attract these upscale anchors and other retailers. After studies showed an upper level would be too costly, the owner, Simon Property Group, acquired adjacent property and expanded the center with grade-level construction. At that point, the design challenge was to create a single identity in both the newly constructed and renovated areas while keeping the center operational.
The expanded Northeast Mall is now a fashion center and general shopping outlet, combining low- and mid-range retailers with high-end anchors. Adding Nordstrom, Saks, Lord & Taylor and Foleys gave the mall a distinctive character and attracted a wider customer base. Many original tenants remained to take advantage of the new marketing opportunities. The leasing team clustered moderate stores in the Dillard's wing and upscale stores near Saks and Nordstrom.
The “garden party” design concept is carried throughout the mall using trees, grass, flowers, light and breezes, within a modernist, minimalist décor. From the Versailles gardens to the backyard picnic, distinct Breeze, Water and Arbor themes were developed in each of the mall's three wings. The garden party concept features unique architectural elements, materials, lighting, graphics, colors, patterns, plants and furniture, providing a lighthearted design signature and wayfinding orientation for shoppers.
To reinforce the outdoor garden party theme throughout the property, the mall concourse ceiling was replaced and existing skylights were retained for natural daylight. The new curved ceiling is bathed in blue light, creating a perpetual indoor sky.
New limestone flooring in random size and color pattern replicates a garden path. Bas relief panels illuminate each court, reinforcing the natural themes. Food court floor tiles were created from photographs of grass, installed with lawnmower-inspired paving patterns. Terracotta potted plants in common areas evoke lush Mediterranean village gardens. One court features fountains with rotating sprinklers swaying over imaginary grass lawns.
The project met planning and design goals on a tight budget. Existing skylights and structures were kept intact, to direct resources toward shopper-oriented elements such as flooring, furnishings, fountains and lighting.
The development team worked closely with local Hurst community officials by making city council presentations, dealing directly with community concerns and explaining design strategies. Physical improvements included the mall expansion and three new parking decks. The original name was kept, because of high recognition, but a new typeface and logo indicated a revitalized shopping experience.
A regional advertising campaign targeted affluent homes through direct mail, radio, cable TV, newspapers, magazines and billboards. By November 2001, mall sales were up 47%, and occupancy levels were the highest in 10 years. The once plain and ordinary Northeast Mall was transformed into a regional destination rich with color, texture and sophisticated fun.
The renovation and redevelopment of Northridge Plaza, Wynnewood Center and Northeast Mall show how sharp financial planning and strong design can boost tenant occupancy, overall sales and public enthusiasm at newly revitalized centers.
Barbara A. Nadel, FAIA, is principal of Barbara Nadel Architect in New York City, specializing in planning and designing justice, health and institutional facilities. Nadel chairs the AIA National Advertising Committee and AIA Committee on Architecture for Justice. She served as AIA National Vice President in 2001.