ATLANTA -- Mixed-use projects are one of the quickest — and most profitable — ways for big-box retailers to enter new markets, according to a panel of retail real estate experts who spoke during the International Council of Shopping Centers’ 2004 Southeast Conference taking place at the Cobb Galleria Centre in Atlanta Oct. 26.
“[New urbanism] requires more due diligence, but the payoffs are bigger,” said John Zielinski, real estate manager for Lakeland, Fla.-based Publix Super Markets. “It’s a way to be competitive and a way to enter markets that we couldn’t have otherwise.”
Target Corp., for example, will anchor Perimeter Place, a massive mixed-use project in Atlanta that is underby St. Petersburg, Fla.-based developer The Sembler Co. The project will include 500,000 sq. ft. of retail space and more than 500 apartments.
Likewise, a SuperTarget and a Kroger grocery store also will anchor Sembler’s Edgewood Retail District project, also under construction in Atlanta, according to panel moderator Jeff Fuqua, Sembler’s president offor the Southeast division. The project will include 650,000 sq. ft. of retail space and 300 multifamily units.
“We especially like the consistency of shoppers that grocers bring to a project,” noted panelist Chris Case, senior regional real estate manager for Minneapolis-based Target.
Big-box retailers also are utilizing innovative layouts as a way to enter non-traditional markets. For example, Kroger built a store just outside of Atlanta in which the parking lot is on the roof, according to panelist Tim McNamara, senior real estate manager of Kroger Co. “It’s a sexy project,” says McNamara, who is based in Nashville, Tenn. “It’s creative and good-looking.” However, the new format had some initial drawbacks, McNamara noted. “We had to condition customers to park up on the top.”
Likewise, Target turned to a multi-level format in order to utilize space in the Lenox Marketplace shopping center in Atlanta’s Buckhead submarket, according to Case. The two-story format – complete with a shopping cart-carrying escalator -- is located in the Lenox Marketplace shopping center in the Buckhead submarket of Atlanta, which is built around a 500,000 sq. ft. multi-level parking lot.
“Synergies are what we look for,” Case said, “and we especially like the synergies created by the mixed-use environment.”