Retail architects throw around the term “lifestyle center” pretty loosely, using it to describe a wide variety of projects. But what do they mean when they say those words? And what's the difference between an “authentic” lifestyle center and one that rings false? In two separate roundtables, leading retail architects discuss the fluid nature of the lifestyle center concept, its impact on retail real estate, and barriers that could prevent this trend from reaching its full potential.
ROUNDTABLE 1 PARTICIPANTS:
- Bruce K. Adib-Yazdi
Butler Rosenbury & Partners
- Anthony Belluschi
- W. Mark Carter
Thompson, Ventulett, Stainback & Associates, Inc.
- Tipton Housewright
- Arnold Gitten
Beame Architectural Partnership
- Richard L. Grandy
Nadel Architects, Inc.
- Jeffrey J. Gunning
RTKL Associates, Inc.
- David W. Moore
SCW: Where do you see the trend toward lifestyle centers heading? Is the demand for lifestyle centers still strong?
GITTEN: I see it right now as the focal point, especially after what happened on Sept. 11. I think people are going to go into smaller lifestyle centers where they feel they can go back to a community. I know we have been assigned more lifestyle centers across the country and even down in Brazil, where they want to get back to the family. I say bring everything in, the supermarket, what have you. For example, at a project in the Carolinas we're bringing a public library right next to the lifestyle center.
MOORE: One of the really interesting things about the lifestyle center phenomenon is the wide range of variety, anything from a glorified strip center with more amenities to the Main Street experience. We're even looking in multiple locations at some big boxes combined with entertainment and lifestyle components. The range of what you can describe as a lifestyle center is pretty big.
GITTEN: What is a lifestyle center?
ADIB-YAZDI: A way of answering that is to ask, ‘Whose lifestyle are we addressing? Is it a lifestyle center for people that are a certain age group? Is it a lifestyle center for people who have certain habits? Is it a lifestyle center for a particular gender?’
You have to understand who the customer is. I really see the need for what I am going to call the neighborhood center — which is the grocery store, the little drug store, some day-to-day needs for families and neighborhoods, a nearby place that people can go to and enjoy on a day-to-day basis.
GUNNING: That's another trend, and lifestyle is a part of it, but it's the trend toward retail that's mixed with residential and office in a true live/work/play environment. I'd say that 50% of what we're working on has some aspect of mixed-use to it.
These projects incorporate grocery stores and big boxes and smaller, more traditional tenants, below residences or, in many cases, offices. People are flocking to these because they offer a different experience from the regional mall. They're more urban. They feel more like true downtown shopping streets.
BELLUSCHI: That was the genesis of why lifestyle centers got started in the first place. I think there was a focus away from public spaces even before, but now the current situation has only exacerbated that. It's clearly adding to the emphasis on lifestyle or open air or Main Street centers. It's a trend that's not going to go away any time soon.
HOUSEWRIGHT: It sort of addresses two things simultaneously. One is we are talking about the sense of community and building a genuine interaction with the community, but also the fact that people regardless of security concerns are still very busy and very pressed for time. And when you can locate all these different elements in a single place and they can make multiple visits and have multiple activities on the same site, it satisfies two needs at once. So I think that's the real opportunity for us here in the next several years — working more and more with the public libraries and other components of the community.
MOORE: One thing that to me defines the lifestyle center as much as expense, which I think is critical, is the tenants that are looking to go into these types of centers. We all know that leasing is pretty crucial to everything we do. And I have been really impressed with the range of tenants that are looking at lifestyle centers with a lot of interest. I talk to the leasing agents a lot, and I ask them, ‘Are you worried about being outdoors, about being in the weather?’ Typically they aren't. They're really interested in being outside where they can be seen.
GUNNING: The other interesting development about the lifestyle center is the lifestyle center components that are part of a regional mall. A lot of people are involved in closed regional malls that also have an outdoors street environment. There are a lot of tenants that want to be inside and a lot who want to be outside. And I think everybody is kind of experimenting with that to see how it works.
ADIB-YAZDI: Kind of like hedging your bets.
GUNNING: It introduces an urban aspect into the regional mall diagram. The ring road isn't as sacred as it once was. There is a gradual breakdown of things that were thought to be unchangeable. That's what makes it exciting. I hope they fare well.
CARTER: It's not hedging your bets. We are now into another topic, hybrid malls, which are all about giving shoppers more than just a typical mall experience. You are right — there is a lot of experimentation going on, and it has a lot to do with the tenant mix and the size and the critical mass that you can get. Hybrid malls can give you the best of both worlds.
If you think about it, the lifestyle center was an opportunity for some of these mall fashion retailers to expand their market presence without having to go into a mall. They were looking for these great demographic neighborhoods that had the demand for their product. That was a home run. Now we're talking about adding other things to that. Can you add housing on top of that? Can you add office? Can you change and increase that mix? I am not sure how many of those are really happening yet. There is a lot of discussion about it, but it's a developmental hurdle to make some of these things come together. It takes the right partnership or a unique developer to pull that off.
MOORE: Financing seems to be one of the keys, but the traditional financing community is not set up directly to finance mixed use.
GRANDY: You also have to find a developer who is willing to do both. It's hard to mix the uses on the same lot where there is a clear division between buildings. The one we did in Hollywood, it has residential above, but it's actually a state-run senior assisted living facility. The developer just built a building and leases it back to the state. He is still in his same business mode, and there is not separate ownership there between the two. I see how our mixed-use is perceived, and we don't have anywhere where the developer is doing both right now.
HOUSEWRIGHT: I think that we as designers have an opportunity in the coming years to work with the financing people, to work with the planners, to work with the developers, to reintegrate these various functions into meaningful places in our communities. It can be done. We have all seen lots of successful mixed-use projects on a very large scale. But bringing that down to being meaningful at a community level, at a neighborhood level, I think is what we haven't seen a lot of. We're going to be working hard on creating some of the solutions.
ROUNDTABLE 2 PARTICIPANTS:
- Sy Perkowitz
Perkowitz + Ruth Architects
- Kevin M. Zak
Dorsky, Hodgson + Partners
- James B. Heller
- Greg Tysowski
- Everett Hatcher
Crawford, McWilliams, Hatcher Architects, Inc.
- Jeffrey T. Gill
- Raul Anziani
- John Bierly
Callison Architecture, Inc.
- Scott R. Pollack
SCW: Where do you see the trend toward lifestyle centers heading? Is the demand for lifestyle centers still strong?
HELLER: In reality the lifestyle centers could be compared to what the power centers were six, seven, or eight years ago. Then, the power center was the new format. It was a way for a developer to get in and out more quickly, to pull a lot of cash out of a project, because they could sell the pads. And I'm waiting for that to come to the lifestyle center trend, where they can carve out the piece for the Talbot's or the Williams-Sonoma.
We did this project in Temecula, Calif., where we had 18 to 20 peripheral parcels and an outdoor entertainment, restaurant area that was connected with the theater. And even before the mall opened, 14 of the peripheral parcels were all developed, built, and owned by the user, because obviously that provided cash to the project. With this lifestyle center, we've really expanded the center and taken the peripherals, plus other retailers, and given them individual identities. So I think the concept is really evolving.
ANZIANI: Well, we're doing more of the lifestyle centers, and we're seeing a lot of public agency support. These communities are looking at the national tenants and saying, ‘We know what you do nationally, but what can you do for us individually? This is our community.’ It becomes much more of an individual negotiation with each of those tenants.
BIERLY: It will be interesting to see if the demand stays there from the tenants' point of view. The margins are not good in retail in general. And with tenants, you're talking about a group that essentially developed its model in the regional shopping center. When you start throwing in morereview requirements — a storefront, two stories, multiple entries — it really tests the economics for a lot of these guys.
HATCHER: In many cases what developers are doing — having landscaping, having something besides concrete between the front of the stores and the parking lot, having music piped out to the sidewalks — it's not because they're being altruistic. It's because that's the only way the developer is going to get his project approved. In all the communities that we've worked in during the past five years we've seen pro-development city councils, one after another, turned out. And they've been replaced by controlled growth, by smart growth, by anti-growth politicians who are not going to listen unless somebody comes in with that kind of package.
ZAK: My concern is that the architects' reactions to the cities' requirements relative to those things are going to create sort of false developments — developments that are trying to elicit responses that aren't authentic.
PERKOWITZ: I know of a few of those.
ZAK: You see them out there already, and you wonder how long they'll be the fancy of the public, as opposed to the authentic experience. I think that's really the critical thing — developers are building town centers that are essentially malls, that are standing within the inside of ring roads and have all the out lots. It doesn't bring anything to the community. And that, long term, is not going to wear well.
HATCHER: It's a Disneyland kind of approach in some of these projects. They have Main Streets that go nowhere. It rings false.
GILL: With so many or our newer cities built from the '70s on, if you ever look back at some of the records and see what happened in about a 10-year span, there is no sense of a downtown. They don't have anything. It's just one strip center or power center or neighborhood center after another. I think that a lot of these communities are looking for that Midwest sort of appeal, that had the little Main Street, where you had the nice lawn out there that you could gather, and so they're forcing people to bring that back to them.
POLLACK: And yet, if you really want to do a mixed-use project, in most places outside of urban corridors the zoning doesn't really allow you to do it. The zoning is written to segregate uses. There is a basic problem with the zoning in the United States. People talk about the problems with sprawl all the time, but there is an argument to be made that one of the major root causes of sprawl is the basic zoning in the United States.
We run into this problem all the time where you try to do something that's a little different, that sort of seems to have an organic feel to it, and you end up needing variances, needing to change the underlying zoning, needing to go through these complicated hurdles. Some developers are willing to go through that. But a lot of people who would otherwise be willing to do interesting projects just don't have the wherewithal, the capital or the time.
ZAK: Sometimes it's a big fight.
PERKOWITZ: This is where development agencies, redevelopment agencies, community development agencies, are in contradiction with zoning agencies. I think you're right — a true authentic mixed use is something that can be a basic conflict within those systems.
HATCHER: It's an interesting dichotomy, in that the zoning folks are still the zoning folks, and they haven't changed at all, but all the planners that we're seeing in all these little communities are becoming the New Urbanists.
They are carrying this New Urbanism flag, and they're all fired up, and they want to do these projects, but yet the bureaucracies behind them don't understand it.
PERKOWITZ: They almost have to restructure themselves to really make the changes they want to make.
ZAK: We're seeing changes. In both of the projects that we're working on in the Cleveland market, Legacy Village and the Hudson downtown redevelopment, the cities had the wherewithal to get their planning and zoning processes in place, properly, four or five years ago.
ZAK: A lot of communities aren't anywhere near that sort of sophistication.
POLLACK: And typically, the public's response is anti-development without actually getting at the underlying problem, which is of course the zoning.
GILL: I think what will happen, as we work towards this sort of common goal for the greater good in architecture and in providing places, is that we'll have more to draw on. The average person doesn't understand a set of drawings, but give them a picture and you can say, ‘This is what we're trying to create.’ That's going to change their perception.
HATCHER: I don't know if pictures are enough. In our experience, if you can take somebody to a project and they can see it, and feel it, and walk through it, then that same developer is going to be successful in the next project.
PERKOWITZ: I'm not sure a track record — ‘You did it here, therefore you could do it there’ — always works.
TYSOWSKI: I don't think it would be the same project. In the U.K., I worked with some people that developed probably the last enclosed mall that England would ever allow. They just said, ‘That's it. There isn't going to be any more.’
They did a good job. They tried to instill leisure and lifestyle and all the things we talk about and spent a lot of money on an isolated site. And they're now developing projects in urban areas in the U.K. that are city centers, that are incorporating all that, because they do have the team and the wherewithal to prove it.
So it's not the same project, but the principals and the logic, the vision, to be able to convince people and say, ‘Hey, I did this. But it's not going to be the exact same thing. It's going to be different.’