As competition with increasingly popular online retailers along with unique Main Street boutiques rises, shopping centers are tasked with finding ways to give consumers more of a reason to visit their venues on top of just making a simple purchase.
When it comes to South Jersey, there are a few noticeable trends that are bringing in the customers. Trendy eateries and national restaurant chains are popping up across the shopping landscape, enticing customers via their taste buds, while renovation overhauls are appealing to the eyes by transforming both indoor and outdoor shopping centers. One thing is the same for both: the goal of creating the one-stop shop destination.
A Revitalization Boom
In this economy, some developers are choosing to reinvest in—and reinvent—properties to bring them up to date. “The trend is redevelopment. Existing space is being made more aesthetically pleasing so consumers want to shop there and retailers want to be tenants,” says Jesse Tron, spokesman for the International Council of Shopping Centers (ICSC), the industry’s global trade association.
A good example would be the redevelopment of the former Lions Head Plaza in Somerdale, which gave the struggling and almost completely abandoned shopping center a much-needed facelift. Relaunched as the CooperTowne Center, the 40-acre project was completed in 2010 with eye-catching facades, a tree-lined entrance, gazebos, a public plaza, extended sidewalks and landscaped garden beds, bringing the Main Street feel to a more large-scale shopping center. “Having lost both anchor tenants, we redeveloped an existing asset to bring retail back to the property,” says Dovid Spector, director of retail leasing for National Realty & Development Corp. (NRDC), CooperTowne’s owner.
After becoming a retail “ghost town” when Caldor and Ames department stores filed for bankruptcy, the retail center has been reborn with a Walmart Supercenter and LA Fitness as anchors, as well as a renovated 16-screen Cinemark theater. “We’ve created a new town center that is a community destination,” says Spector.
The opening of an Applebee’s restaurant this past January culminated the revitalization that significantly increased customer traffic and spurred a turnaround for merchants. “We’ve provided an entertainment experience to the center, so people don’t come just to shop, but to enjoy dinner and go to a movie,” Spector explains. He adds Somerdale benefits from an additional $1.2 million in tax revenue and numerous job opportunities.
NRDC’s Liberty Square Center in Burlington is also undergoing construction as Walmart expands to a Supercenter and Marshalls renovates its facilities. Party City relocated to a larger store and Anna’s Linens joined the list of merchants.
“Retailers are interested in expanding again,” says Spector, noting that NRDC’s first quarter of 2012 was much busier than this time last year, with tenants signing new deals all over the Northeast.
The Dining Draw
As with the addition of a recognizable chain eatery at the CooperTowne Center, restaurants attached to both indoor and outdoor shopping centers tend to be a major pull these days. “Restaurants are a traffic driver,” says Laura Balga, general manager and marketing director for The Promenade at Sagemore in Marlton. With BRIO Tuscan Grille as the latest addition to its upscale dining lineup, Balga says families and friends come to the center for a social experience that combines eating out and shopping.
“Landlords seek out restaurants to bring in weekly guests,” remarks Saed Mohseni, CEO of BRAVO BRIO Restaurant Group, Inc., which opened its second New Jersey BRIO in November. With 90 percent of its restaurants situated in a retail center, the company is counting on shoppers to work up an appetite. BRIO locations serve 3,000 to 5,000 guests each week, so neighboring retailers expect sales to rise due to the influx of prospective customers who often buy online, but venture out to sample the cuisine. “The Internet plays a dominant role in how people shop, but restaurants and retail work well together because people get the chance to experience rather than be focused on the buying part,” says Mohseni.
Pennsylvania Real Estate Investment Trust (PREIT) continues revitalizing its three South Jersey malls by adding new stores and restaurants into the mix. The results have been phenomenal for Cherry Hill Mall, with sales eclipsing $600 per square foot, according to Joseph Coradino, president of PREIT Services (and soon to be promoted to CEO of PREIT). “Average store sales increased 34 percent since Nordstrom opened in 2009,” says Coradino.
The company spent more than $200 million to turn the mall into a high-fashion destination, with more than 25 stores new to the region. Henri Bendel, a retailer offering designer handbags, footwear and accessories, will open this summer. By the fall, another half dozen stores will make their debut. The Grand Lux Cafe, the high-end concept from the creators of The Cheesecake Factory, will join restaurant row in August. “Restaurants have become the new anchor for malls, representing a significant traffic and sales generator,” says Coradino.
PREIT plans to invest $30 to $40 million to revitalize the Moorestown Mall thanks to passage of a voter referendum allowing its restaurants to sell liquor. Coradino says negotiations are progressing with world-renowned chef Marc Vetri to open a rustic Italian eatery by next Valentine’s Day. Although yet unnamed, he says terms have been agreed upon for two additional dining establishments.
Construction begins this spring on a 12-screen Regal cinema replacing the United Artist theater. “Customers are more relaxed when they are going out to dinner or to the movies,” says Coradino.
A $90 million makeover converted the former Echelon Mall into the Voorhees Town Center, a mixed-use property combining retail, restaurants, offices and residences. “We’ve created a downtown urban streetscape,” says Coradino. With an occupancy rate of only 67 percent, PREIT is looking at nontraditional tenants to fill vacancies. Voorhees, for instance, relocated the township’s municipal offices to the renovated mall last year, while the Camden County Improvement Authority will move there this summer.
New tenants opened on the shopping center’s Town Center Boulevard, including The Sporting Club, a 13,000-square-foot fitness center. PREIT also plans to continue pairing dining with shopping. Further differentiating the Voorhees Town Center will be a farmer’s market selling locally grown produce, fresh flowers and baked goods on Saturdays from May through mid-October.
As online sales escalate, keeping up with technology is also critical for South Jersey’s retail centers. Coradino says PREIT will roll out the second version of its mobile mall app later this summer and is working on implementing Wi-Fi access in its properties, all part of adapting for the future and remaining in tune with customers’ needs.
“We can’t hide from the Internet. We must embrace technology and make malls more shopper-friendly and convenient for our customers,” he says.
Published (and copyrighted) in South Jersey Biz, Volume 2, Issue 4 (April, 2012).
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