If you're ever in Cincinnati and see a car with plates reading "PLACES," you're likely to find John Boorn inside. Boorn, chairman and chief executive of Madison Marquette, is also the driving force behind the Cincinnati-based company's tagline, "creating special places."
Madison Marquette is known locally for developing the city's successful Fountain Place, a downtown retail center that includes Tiffany & Co., Brooks Brothers, Lazarus department store and Palomino restaurant. Nationally, the company finds itself among the industry's leading forces, boasting 20 million sq. ft. of space under ownership and/or management with properties located from Tampa to Seattle - all in just under 10 years.
Obviously, Madison Marquette's growing national success story pleases Boorn. However, he says, "There is no magic to a sense of a balanced portfolio in terms of a particular type of project." The goal is simply to develop "specialized projects across the country."
And that is precisely what Boorn has done. Boorn and Madison Marquette President James Bennett began working together in the '70s at Cincinnati's Federated Stores Realty, the development arm of Federated Department Stores. In 1990, along with Federated colleague Louis Mitsch, they created the Boorn Bennett Partnership, convinced that a market existed for non-mall retail projects in areas with high income and education levels.
The company they founded was, as Boorn has since described it, "three principals, five employees, no revenue and no capital." The early years were spent lining up financial partners and properties.
In 1992, Washington, D.C.-based Capital Guidance Corp., an international investment firm, signed on as an equity partner in Madison Realty Partnership. In 1995, the company acquired and merged with Marquette Partners, a Minneapolis-based property management firm, to create Madison Marquette.
Today, the Cincinnati office is known as Madison Marquette and handles property development. The Minneapolis office is known as Madison Marquette Realty Services and is responsible for property management.
Growth through joint ventures In its race to become a national player, the company is accelerating the pace with a recent series of alliances and acquisitions.
In March, former members of The Retail Group - a Washington, D.C.-based retail real estate services firm that was a division of Smith Braedon * ONCOR International - formed a new entity in affiliation with Madison Marquette Realty Services, to be known as Madison Retail Group. Remaining headquartered in the D.C. area, Madison Retail Group provides retail tenants and owners with leasing brokerage services, investment sales and property management throughout the mid-Atlantic region.
In January, Madison Marquette Realty Services purchased Hollis & Associates, a Newport Beach, Calif.-based management firm. The acquisition added 6 million sq. ft. of space to the 13 million sq. ft. already under management.
Last year saw a joint venture with Indianapolis-based Simon Property Group and New York-based DLJ R-eal Estate Capital Partners LP (the merchant banking fund of Donaldson, Lufkin & Jenrette) to develop upscale venues around the country.
In November, Madison Marquette and CB Richard Ellis Investors LLC, a Los Angeles-based real estate investment manager, announced a joint venture to acquire neighborhood shopping centers. Plans call for assembling a portfolio of up to $300 million in properties over the next two years.
The CB Richard Ellis joint venture strategy is to reposition well-located urban, neighborhood and community centers into entertainment, lifestyle-village concepts. One such acquisition was Old Hyde Park Village in Tampa. Anchors at the 247,800 sq. ft. shopping center include Jacobson's, a seven-screen AMC Theatre and office space.
Off the branding bandwagon At present, Boorn could easily be content with Madison Marquette's status in the industry. However, the content of the projects is what shapes the company's attitude toward developing retail properties.
Madison Marquette is more interested in developments fitting the markets lying between regional malls. "Although regional malls fill a valuable position in the retail world," he says, "they are so vast and require such a large geographic market to sustain them that they create a kind of anonymous and impersonal world."
By contrast, Boorn explains, "We are very determined to create physical environments that people enjoy being in and ones where they have a sense of place and ownership."
The lifestyle village projects deliver these components of community. "Scale is an important ingredient in what we do," Boorn says. Visitors will find unenclosed projects with streetfront-like facades, pedestrian walkways and a well-chosen assortment of upscale tenants numbering in the dozens, not hundreds.
While its largest projects occupy thousands of square feet rather than millions, Madison Marquette properties still attract national anchors, including specialty stores ranging from Jacobson's and Saks Fifth Avenue to the large-format flagship concepts of Old Navy and Pottery Barn. In between, customers can sample theaters and restaurants and national specialty chains like AnnTaylor and Brooks Brothers.
Despite the presence of such national players, Boorn is quick to point out that each of the company's properties has its own identity. "We care more about our projects fitting the community and the people who shop there," he says. "There's no cookie-cutter or template that brands our projects in terms of tenants, or architectural style or any unique icon that would identify a project as one of ours."
A look at Madison Marquette's current projects - both urban and suburban - bears out the sentiment. The company recently completed The Gardens on El Paseo in Palm Desert, Calif. (see SCW, March 1999), a 200,000 sq. ft., two-level center that features architectural detailing befitting Southern California. The lush landscaped gardens of the open-air center were designed to fit the desert climate and tie together the center's seven freestanding buildings. Anchor Saks Fifth Avenue is joined by 40 specialty stores including AnnTaylor, Banana Republic and Talbots. The center also houses an art gallery where community artists can exhibit their work.
Meanwhile in Seattle, Madison Marquette reclaimed the vacant former I. Magnin store at Sixth and Pine streets. There, the company signed the city's first Old Navy store to occupy the majority of the four-level, 72,000 sq. ft. space.
Architecturally, the building's former smallish windows were opened and the exterior reskinned with new building materials to blend with nearby newer developments. Known as 601 Pine St., the project sits catercorner from the city's new Nordstrom and across the street from Pacific Place, in the heart of Seattle's rejuvenated downtown entertainment and retail district.
In Fort Myers, Fla., The Bell Tower Shops was an old specialty mall anchored by Jacobson's. Today, the 310,000 sq. ft., open-air center is co-anchored by a Saks Fifth Avenue resort store along with a 20-screen theater, which Madison Marquette added to the existing base.
Attracting local and regional tenants If developing an indigenous look for the community is paramount to Madison Marquette's success, so too is its approach to tenanting properties, a task that is the responsibility of Susan Haight, senior vice president and director of leasing.
"Our tenants are primarily local or regional and are complemented by strong national chains," she says, adding that the company devotes a great deal of time and energy in developing the right merchant balance for each project. "We're in the market early talking with people to get to know their business."
Maintaining an open mind to novel retail concepts has in fact boosted the company's tenanting efforts. "There are people who have come to us with terrific ideas who didn't know where to put their concept," Haight says. "Then there are those who are reinventing and re-creating themselves who want to try a setup that's different from a regional mall. They come with us because they believe they can do business and they like the setting."
Madison Marquette's growth seems all the more notable since traditional regional mall starts are at a virtual standstill. Although its portfolio might read like a tourist's dream with projects dotting the map from Dallas/Fort Worth to Florida to California, Bennett is adamant about his company's ongoing commitment to the underserved, upscale retail market niche.
"We'd be very suspect of any project that was strictly a resort or tourist location," he says. "The key in making these projects work is developing a real gathering spot for locals."