The Latin influence pulsates through virtually every facet of life in Miami, from the nightclubs to the business district. The local government's mission statement, for example, seeks in part to establish Miami-Dade County as "the global financial services center for Latin America to enhance job growth."

While Miami has long enjoyed an enviable tourism business and a favorable climate for retailers, a dramatic rise in the Hispanic population throughout the region has led to profound changes in the area's retail mix.

With the help of tour guide and developer George Panarites, principal of Kabo Retail Properties, Editor Matthew Valley traveled to Miami in early June to see firsthand some landmark projects, including The Shops at Sunset Place, CocoWalk, and South Beach Cinema & Retail.

A roundtable discussion hosted by Shopping Center World and featuring some of south Florida's leading commercial real estate executives was held June 8 at the Hotel Intercontinental. Nine industry experts offered their insights on issues ranging from demographics to emerging retail concepts to potential problems looming on the horizon. An edited transcript follows.

SCW: George Panarites, when we were driving around greater Miami yesterday, you informed me that there are a number of people whose homes here serve as a secondary residence, not a primary residence. You stated that the Census numbers don't necessarily reflect that trend. Please explain.

George Panarites: Probably half of the high-end housing units belong to absentee landlords - absentee in the sense that they may even live here seven or eight months out of the year, but they still register to vote back in Chicago, New York or Paris or London and were never recorded in the Census.

The new condominiums - the ones that have come online in Miami Beach - have cost $500,000 and up. I figure somewhere in the vicinity of $1 million is the average. From a demographic standpoint, those residents are off the chart as far as disposable income, but that trend isn't reflected anywhere in the Census numbers.

These people don't come up here just for vacation. They come up here once a month on business, and they've bought homes. Their children are going to school here at universities or private schools, in many cases. None of those people are reflected in our Census numbers.

And you have to keep in mind that many of the Latin people that come here are very wealthy, very successful people back in Latin America. They are either expanding their business or like the idea of diversifying their investments, and they take major positions here in the U.S., some politically motivated, some purely for economic reasons. Those trends reflect strongly in our retail sales.

SCW: Sandra Witmer, as you go around the country, are there misperceptions people have about the Miami market?

Sandra Witmer: The one misperception I think people have - and it gets quickly put to rest as soon as they try to open a business here in south Florida - is they're not sure how their merchandise will translate to a Latin market. A lot of the restaurant and retail chains are not certain whether their product will be accepted, or if they will be understood.

A lot of people sort of looked at the Dade-Broward County line as that line of demarcation, and they wouldn't come south as a result. Miami is an interesting hotbed for activity in retail as we know it today with the emergence of Coconut Grove and the renaissance that has occurred on South Beach, and even with the success of Bayside with the tourists.

This region has so much to do as far as specialty retail and environments that offer interesting places in which to shop. We're starting now to see all kinds of people entering our market that weren't here even four or five years ago.

SCW: Jaap Donath, as manager of business research for The Beacon Council, Miami-Dade County's official economic development association, can you provide us with some of the job trends in greater Miami?

Dr. Jaap Donath: Miami's job base includes a couple industries. Tourism is a big one, along with international trade and international investment for Latin America. What we see is companies coming here from Europe and Asia as well as North American companies that are here purely for the Latin American market.

For example, we attracted Mercedes Benz last year. Eastman Kodak is here, Disney is here. A lot of the banks are here for Latin America.

That's one of the strengths of Miami, as well as the trade aspect. Last year, 57% of all U.S. trade to South and Central America was coming through Miami; the Caribbean about 40%; and Latin America about 28%.

With that comes all the services, and that's what Miami is trying to focus on. Can we add value to just moving goods? And that includes legal, accounting, any other service that you might need to get people to make deals. Trade financing, project financing, capital improvement financing, anything that has to do with trade improving Latin America we're trying to get it through Miami.

SCW: Is there a lack of Fortune 500 companies based here in greater Miami?

Donath: You mean headquartered here?

SCW: Yes.

Donath: Our makeup of business is much different here than if you go to Atlanta, or Chicago or Dallas. We try to get company affiliates to come here for Latin America. SCW: When the 2000 Census is conducted, what differences w ill it reveal compared with 1990?

Donath: Depending on the methodology used, they'll find that there are a large number of minorities that were left out. The Asian population was left out for a big part. The African-American population was left out for a big part. They now realize that they were undercounting.

SCW: Rod, from a leasing perspective, what effect has the Latin influence had on the retail market?

Rod Castan: Miami has been an incubator for a lot of new retail concepts. A lot of retail concepts that are primarily geared toward the Hispanic market are born here and then they've expanded around the country. For instance, Pollo Tropical and Sedano's Supermarkets, which is a Latin supermarket chain, is growing.

But, many fashion retailers have come to this market and fallen flat on their faces. Others have had successes because they've learned how to target their fashion mix toward the Hispanic consumer, and they've been able to translate that in an international sense.

Sunglass Hut is a retailer based here in Coral Gables. It understands the Hispanic market and has been very successful internationally through a lot of experiences in Miami. That's one of the benefits of being in Miami.

It's a place of many new ideas, a place for a lot of creativity in retail. That's part of the success.

SCW: Is that well known throughout the country, or is that a story that you're still trying to get out?

Castan: It's rapidly being accepted. We have experienced in the last year the introduction of some of the hottest retailers in the country to this market:NikeTown, Z Gallerie and Virgin Megastore. EXPO Design Center has opened up here in Miami. They're located close to the airport and they have refined a lot of their target market. Home Depot is an example of a tenant that is very understanding of marketing to the Latin American consumer.

Brands Mart, an electronics chain, is another retailer that has done a great job because it understands it has to address the shipping needs of the Latin America buyer who comes into Miami. Brands Mart has had tremendous success doing that, and the chain is expanding.

SCW: Are tenants making certain demands in this market?

Castan: The Dade County market is one of the tightest retail markets you'll find because of the lack of land and the density that exists. You'll find that many retailers will adjust their prototypes, or they'll have a very difficult time expanding in this market. We've seen some very creative things done here. Publix has gone with smaller prototypes. Publix opened a 27,000 sq. ft. store off Brickell Avenue that has been extremely successful.

SCW: Craig Sher, are there any parallels that you see between the revival of Miami Beach and the Tampa-St. Petersburg area?

Craig Sher: The Tampa-St. Petersburg market tends to follow other markets. We're typically not the leaders in retail or entertainment. What you're seeing with the success of the CocoWalks of the world is that it's now time for St. Pete and Tampa.

Ybor City is a little bit of a unique place in the Tampa-St. Pete market. It's a very Latin place, we call it the Bourbon Street of Tampa. It's got 20,000 to 25,000 people there on the weekend nights. We're developing that project (Centro Ybor) in Ybor City with Steiner & Associates to capitalize on the very urban nature of that area. We're developing another entertainment retail venue in St. Petersburg (BayWalk), but it has a much different flavor, a much more middle-of-the-road marketplace.

We don't have the real dense, urban nature and massive tourism that Dade County does, so we're probably not going to get as many of the new retailers coming to our area. We're going to get some of them.

SCW: Can you give us an update on the Centro Ybor project, a restaurant/retail/movie complex?

Sher: We're under construction on Centro Ybor and we're about 75% leased. We're featuring a Muvico Theater. We'll be open in June 2000. The city is really looking forward to it, and I think it's goingto capitalize on a great existing marketplace.

Witmer: Going back for a moment, the Latin population has created this extended-business-hours opportunity for Dade County that doesn't exist in a lot of markets. Prior to CocoWalk, everything in Coconut Grove was closed at 6 p.m. Because of the Latin population, the lifestyle here is very late night, so you have retail open now until 10 p.m. or midnight, depending on the night. The same holds true for the restaurants and nightclubs. It really has given a lot of people huge success stories to talk about. Look at what happened in South Beach. It was a slum, and now it's one of the hottest places on earth. We're seeing that now in Ybor City. Centro Ybor is a result of that. Dade County has really served as a prototype for other communities.

Sher: The return to the urban core is nothing new. It's happening all over the place. All of a sudden downtown is cool again. Look at Atlanta with the expansion of Midtown, Buckhead and Virginia Highlands. In Chicago, there is not an area in the concentric circle around the downtown that's not being redone.

People are tired of living 50 miles outside of Miami or 50 miles outside of Atlanta because it could take you three hours to get there. In this great economy, people have money and they're moving back to the city. And it's creating all these wonderful new opportunities.

Panarites: In the Miami area, there's nothing really left to develop west of I-95. The suburbs are developed. And there's nothing to develop way over to the extreme east. All that is happening there is you're getting more expensive high-rises. But you've got this strip in close proximity to the water and close proximity to your jobs downtown, and you're seeing a redevelopment.

In Miami proper, you've got the new Cultural Center going in.They've got the new Miami Heat arena. And Biscayne Boulevard, all of a sudden, is starting to come back. Pioneering, merchants have already gone in and opened up shop.

SCW: James, the availability of capital certainly drives a lot of these improvements. Your thoughts?

James Nolan: I have seen the dynamic growth of the downtown - Brickell Avenue, South Beach and West Dade as well as the Kendall area. I travel all over the United States because we buy properties all over. I'm constantly amazed at the Miami growth rate over most of the other areas where I have traveled.

Money drives money. Where you have people making and spending money, retailers will come because they want that dollar.

Relative to South Beach, the catalyst for that development was, I believe, pre-1987. The area south of Fifth Street was under a development moratorium and there was a government plan to redo that entire area. When the government failed to do so, private developers went into that area.And there were large chunks of subsidized deals that were being cut and that area really started.

Interestingly enough, the prime area for redevelopment was really the area north of Fifth Street, which did not have large pieces of land for major developers to come in. What you had was a number of small entrepreneurs building a hotel here, fixing up a shop there, and then their successes brought other successes.South Beach is a real interesting and unique story.

One area of Dade County that hasn't been spoken about here this morning is the Dadeland area. Everybody from the movie people to every big-box retailer wants to be in that area. Consumers in that demographic area are probably in the top disposable income in the entire United States.

Michael Comras: South Miami probably has the highest demographics in the state of Florida. The densities have just proven to be a catalyst and explains why we've been able to capture a lot of the new retailers in the country at The Shops at Sunset Place.

When we had looked at creating the Shops at Sunset Place, we tried to figure out where that street was that exists in most major cities like Michigan Avenue in Chicago, or Madison Avenue in New York. Miami doesn't really have that street. There are different shopping areas, and itwas important to us to find the right spot. And by situating this project, which is approximately 500,000 sq. ft., in the heart of some of the best areas - Pinecrest, Coral Gables, and South Miami - we have been able to capture those huge spending dollars.

In this competitive market with Coconut Grove being just less than five miles away and Dadeland being less than two miles away, it was important to try to create a different project.

SCW: Since its opening, has it outperformed or underperformed expectations?

Comras: It opened up before Christmas with the theaters. Gameworks has been doing exceptional, Nike has been outperforming its expectations. A lot of the tenants that are new to the market have been doing very well.

We have Urban Outfitters under construction now, and Old Navy is under construction. Upon completion, we think it's going to be like a fine bottle of wine, just getting better with time. People are starting to understand what it's all about. When we were developing the project, nobody quite understood what we were doing there.

SCW: Barry Ruzat, Muvico Theaters has developed the concept to build large megaplexes that bring back the glamour of movie houses built in the '20s and '30s complete with unique customer amenities. What's been the response?

Barry Ruzat: We've learned a lot from the first three theaters that we've opened of this generation. Our focus is clearly on the type of theater that we built in Davie, where you create a sense of excitement from the minute the customers pull into the parking lot and when they see it from the freeway. That regional access is very important to us. That theater is pulling from 20 miles in all directions. It's consistently ranked in the top five or 10 theaters in the country since it opened. So, it's clearly something that the public has embraced.

The magnitude of the theater,the overall look of it and some of the amenities that Muvico has improvised into it are attractions. In terms of the other projects, Pompano has been a successful theater, but it's more of a community theater, a neighborhood theater. It does not have the regional pull that Davie does.

Pointe Orlando is an urban type of project. We look with a very keen eye now as to the design and parking and all the different components that go into the theaters because some of these things can be critical in their success or failure.

SCW: As you survey the landscape of megaplexes cropping up nationally, who ultimately will be the winners and losers?

Ruzat: That's a tough question. Obviously, we feel like we're going to be one of the winners. One of the keys is going to be how the different theater companies learn to deal with their older theaters, with all that excess real estate. Every time they open a megaplex, most theater companies are killing one or two of their older eight or 10-plex theaters, and the ones that learn to deal with that issue are going to survive. We're fortunate not to have that issue. We're not looking to be the largest theater company in the country. We're just looking to be one of the best.

Sher: Are you as concerned I guess as I am about overbuilding of these megaplexes? We've seen this cycle before. It seems like it was 10 or 12 years ago that everyone was building eight or 12-plexes and we thought, "These massive things, how can they get any bigger?" Now they've become tomorrow's dollar theaters.

Ruzat: You're going to see a glut of theaters as the number of megaplexes and older theaters peak together until older theaters start to close and are turned into other uses. Then the extreme count is going to settle down again to where it should be.

I listen to everyone talk about the urban projects. As I travel the country, every town that has had a blighted downtown area wants to revitalize its downtown. Every suburban community wants a town center, and in some places it's going to work and in some places it isn't. There is going to be the point of saturation on these types of projects, and developers and retailers are both going to have to look very closely at each project to see if it can stand on its own. And these things typically don't work without a public/private partnership in getting the parking infrastructure and other elements put together.

Panarites: Already the entertainment centers are starting to get boring. I have my question as to how long this entertainment sales thing is going to run.

Sher: You've got to be prepared to turn them over. Virgin Records in five years could be something else. Old Navy could be Old Army, or something else. We're putting in four to six restaurants in most of these projects. I'm prepared in three years that half of them are going to turn over.

You've got to build that into your development. Very few of these stores are going to be around in 10 years. It is a scary thing. We, as developers, have to make sure that our returns are commensurate with the risks. If we're not getting serious returns on these projects, we shouldn't build.

Robert Oppenheim: Our project (The Galaxy at Dadeland) is across from Dadeland Mall. When you talk about South Florida, the numbers that Dadeland Mall chalks up - it's one of the top malls in the country. Over 40% of that mall's business is tourist business, and of that over 60% is from Latin America.

Our project across the street is an entertainment project. We look at ourselves as the entertainment component to Dadeland Mall that it doesn't have. We're going to have seven or eight restaurants, a Tower Records, as opposed to Virgin, and a Ron Jon Surf Shop.

There's over 9 million visitors a year to Dadeland Mall, and it's a major tourist attraction in addition to the sales of over $700 per sq. ft.

SCW: What will be the next evolution in this whole entertainment sector?

Comras: A lot of these tenants - such as themed restaurants, music stores, book stores - will roll. A large part of the reason for entertainment coming into retail is that you can buy items over the Internet. You can get catalogs, but you can't replace the entertainment factor. The trick as we move forward is to keep the shopping experience interesting.

Oppenheim: When VCRs came out, people were going to stop going to the movies. People like going to the movies and people like going to shop. It's something to do.

SCW: Hasn't the improved technology, the stadium seating and elaborate sound systems, contributed to that consumer demand?

Oppenheim: About the same number of people each year for the last 30 years have gone to the movies. It is almost a straight line for over the last 30 or 40 years.

Nolan: Let me suggest the following. We're in the very early stages of entertainment shopping, almost to the same level of the early stages of the regional mall development. What will happen is that capital will be available to projects if they're successful. As soon as a few projects fall on their butts, the capital will dry up in an instant, and these things will have to be reformatted or something else will have to be done.

Presently, they're successful. How many can we build in how many urban areas and at what price? You can no longer find, and I'm making a generalization, capital to build a freestanding movie theater. So what is necessary for Barry, of Muvico, is to team up with an entertainment developer who will help with the financing because he brings a risk pattern to the lender that he has not only a movie theater, but he also has Old Navy, Barnes & Noble and NikeTown and all of these other elements. Capital will drive these projects on a going-forward basis.

Castan: The reason the ones in Miami have been successful is that you've got vertical residential density around them. You've got the people around them. The dangers are with downtowns that are driving to have movie theaters in them but which really do not have the people living there, or aren't accessible via a good expressway interchange.

Panarites: The positive about Dade County or Miami is that we've got 200,000 or 300,000 tourists in season every couple of days turning over, and it's a new experience. They go to either Dadeland, or they go to The Shops at Sunset Place or theygo to Lincoln Road. It's a new experience.

Donath: The tourist numbers are pretty stable. They are not growing fast, and they're very dependent on the economy, which is South and Latin America. The Brazilians stayed home (last year) and they're the highest spenders. Overall, the spending level went up a little bit, but the number of people dropped last year.

Panarites: It's a good point, and we're always going to have that problem because with South America we've got a lot of emerging economies. It's going to be up and down. I see over the next 20 years, it's going to be a growth mode and that tourism is a major drive.

Sher: We can't fool ourselves. We, as developers, are pretty stupid because whenever we find a good thing we build the hell out of it.

My big concern is we're going to keep building all this stuff and in a few years the world is going to go to hell. The economy is going to go to hell. It always does. I'm not that old, but I still remember the late '80s and early '90s. I'm really frightened, especially about these entertainment retail projects.

Nolan: Craig, you said you grew up in Minneapolis. Well, then you're familiar with the Mall of America, the biggest enclosed mall in the entire U.S., I believe. Can Minneapolis handle another one?

Sher: I don't think so, but someone will try (laughter). For every one that Barry builds or AMC or Regal builds, there's got to be some fallout. He's got to suck 24 screens worth of people out of somewhere else. So where is it coming from? We just don't have this huge, great economy where all of a sudden a million people move in next week.

What's going to happen is all the theaters with stadium seating are going to start cannibalizing on themselves, then you really have got an issue. What is the reuse of a 24-plex stadium-seating complex? God only knows.

SCW: Sandra, what is the adaptive reuse for one of these megaplex theaters?

Witmer: The adaptive reuse for movie theaters? I like Rod's idea - racquetball.

Sher: No offense to the Muvico people. We (Sembler) are designing the theaters with stadium seating with the understanding that within X number of years that's probably not going to be a movie theater. I don't know if that's 30 years, 50 years or two years.

Witmer: I don't know that you can retrofit it. The world evolves, things change and we all need to be a developer with a conscience. Our company works real hard at really trying to fill a void, trying to be in tune to what is really going on in the community. We love that Muvico is very much in tune with customers and their needs. They have babysitting services, they have gourmet food. They have a whole laundry list of things that are very customer- friendly, and they cater to their moviegoers, which has never been done before.

As lifestyles evolve, we need to evolve with them, but we need to do it intelligently and with a conscience and not with an ego.

SCW: Are we doing a better job of listening to customers?

Ruzat: It's more of a momentum issue. When you have a program like one of the big theater chains, trying to crank out 50 or 60 theaters a year, you don't have time to stop and react to the market. You have to keep going.

Sher: Lenders have helped in that regard. Money is not as plentiful as it was 15 years ago. Everybody is taking a much more stringent look at the development from the capital side. It forces all of us to think about it a little bit.You have to have more preleasing, you have to have real market studies, you have to have real appraisals, you have to deal with the public/private partnerships, and you have to have more equity.

Donath: Is the retail cycle getting shorter?

Sher: Much shorter. We're a much more technological society. It keeps coming back to E-commerce. Most of us laughed at home shopping 10 years ago, but we're not laughing at the Internet. From a landlord's viewpoint, the Internet is very frightening because massive amounts of sales are already occurring on the Internet. My own family, my own kids buy a lot of stuff from the Internet.

It may not affect so much the entertainment side of it, such as the movies, but it surely affects the cream of most people's sales in virtually anything fungible.

Witmer: People are social in nature. Overall, people do want to be out, they want to experience things. We just need to be on top of that. There are items that people will buy on the Internet because, quite frankly, it's more convenient. Our convenience centers aren't so convenient anymore.

How do we give some pride back to the people who live in the suburbs with some of these concrete jungles that have been built? You pull up to some of these centers and you don't feel so good. How would it feel if you could pull up to a great community center and say, "Wow, I'm glad I live here"?

* Rod Castan, director of leasing, Courtelis Co., Miami

* Michael Comras, president, Comras Co., Miami

* Dr. Jaap Donath, manager of business research, The Beacon Council, Miami

* James Nolan, executive vice president and principal, United Trust Fund, Miami

* Robert Oppenheim, director of real estate, Gulfside Development Co., Coral Gables

* George Panarites, principal, Kabo Retail Properties, Miami

* Barry Ruzat, vice president of real estate, Muvico Theaters, Fort Lauderdale

* Craig Sher, president of The Sembler Co., St. Petersburg

* Sandra Witmer, principal, Retail Estate Inc., Coconut Grove