Open air malls on collision course - East Valley Tribune: News

Open air malls on collision course

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Posted: Thursday, May 26, 2005 10:36 am | Updated: 9:24 am, Fri Oct 7, 2011.

LAS VEGAS - Two upscale open air shopping centers are digging in to do battle for shops and shoppers in ripe-for-retail Gilbert.

Barely a mile apart, Main Street Commons, Gilbert’s planned version of Kierland Commons, and SanTan Village’s revised mall plan — which looks like Kierland Commons with a couple of department stores and a movie theater added on — are asking choice retailers to choose sides.

Developers of both are pursuing many of the same stores — think Restoration Hardware, Tommy Bahama, Anthropologie, for example — and they are shopping their projects aggressively at the International Council of Shopping Centers convention, an annual get together of about 8,000 retailers and retail developers in Las Vegas.

The competing Gilbert projects’ developers acknowledge they can’t both win.

"If both go forward, they will be two mediocre projects and a disservice to the community," said David Scholl, senior vice president of development for Westcor, which is building SanTan Village at the northwest corner of Williams Field and Greenfield roads.

Woodbine Southwest Corp., which built the successful Kierland open-air shopping center on the north Phoenix-Scottsdale border, broke ground last week on Main Street Commons at the southeast corner of Pecos Road and Val Vista Drive.

The company announced this week at the International Council of Shopping Centers convention that furniture maker Thomasville will buy five acres next to the Main Street complex to build showrooms for its own brands — Thomasville and Drexel Heritage — plus a few other upscale furniture stores, said Woodbine Southwest president Buzz Gosnell.

Woodbine also landed Mountainside Fitness, an upscale gym and health club to be built on another five acres nearby. And Gosnell said he is negotiating with two boutique, limited-service hotels for another chunk of land.

As for the heart of the project, which replicates a downtown shopping district from a half-century ago, Gosnell said he is making progress on landing retailers, but he would not name any since they haven’t signed a contract yet.

"If we weren’t confident, we wouldn’t have started construction on (a more than $100 million) project," he said.

Gosnell said Woodbine is on track to have the the first phase of Main Street Commons open by fall of 2006, nearly a year before SanTan Village, and that is an advantage for retailers who want into the choice area.

Woodbine also has the respect of the hard-to-land store names that have shops at Kierland Commons, he said.

"The competition is serious, but I’m not worried," Gosnell said. "Tenants have two choices. They’re looking at both projects. The advantage is we’ve done it before."

SanTan Village’s center already has snagged some of those Kierland retailers, Scholl said. The company doesn’t have signed leases yet, he said, but the deals are far enough along that Westcor can name names. They include Aeropostale, Chico’s, Coldwater Creek, J. Jill, White House/ Black Market, Z Gallerie, lucy, Soma and Jimmy Z.

Scholl said that is Westcor’s advantage in the shopping center war.

"We have a large percentage of commitments, 60 percent to 80 percent of the space accounted for," Scholl said. "We’ve got a critical mass, and that is appealing to retailers."

Lucy CEO Mike Edwards said he opted for the Westcor project because of the other stores locating there even though he is in Kierland and likes Woodbine Southwest.

"It was the co-tenants at SanTan Village that at the end of the day drove my decision," Edwards said. "We have the same demographics. We’re compatible. And we support each others’ brands. But it was a hard decision for everyone because they are both sound developers with good track records."

Michael Niemira, chief economist for the International Council of Shopping Centers, said that having two open air centers in that close proximity does not make sense.

"It diminishes their value, and only one ultimately will survive," he said.

Niemira said in an up cycle, the wide availability of money for development at low interest rates can fuel unwise over building.

While Woodbine and Westcor have put on the gloves over Gilbert shoppers, the two have recently teamed up on Kierland Commons, the center both aspire to emulate.

In January, Woodbine took on Westcor as a partner to manage Kierland Commons.

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