Reprinted from ThanMerrill.com
Photo credit: ThanMerrill.com
Commercial redevelopment has become synonymous with the most lucrative exit strategies known to investors. While their commitment is more than that of the average residential project, the returns can be much more impressive. It’s worth noting, however, that returns extend far beyond padding your bottom line. The right commercial redevelopment project can revitalize an entire community in more ways than you may know. The next time you decide to take on a commercial project, make sure you understand just how much your impact may be felt.
COMMERCIAL REDEVELOPMENT & THE LOCAL COMMUNITY
A commercial redeveloper, not unlike their residential counterpart, has a much greater impact on the local community than many can even begin to fathom. Outside of the obvious appreciation redevelopment provides for a subject property, communal benefits extend far beyond the building in question. In fact, you could argue that commercial redevelopment is a viable catalyst to stimulate economic growth in everything from small businesses to individual homeowners. The ripple effect resulting from a proper commercial redevelopment project can have a resounding impact on a community for years — if not decades.
Done properly, commercial redevelopment can improve a local community in more ways than one, and there is no reason your next project can’t be the one to do so.
Appreciation
First and foremost, commercial redevelopment is entirely capable of resulting in a higher price point. Not surprisingly, remodeling a commercial building will increase its value and result in more demand — the two things that make this exit strategy attractive to investors in the first place. With that in mind, residential redevelopers aren’t the only ones that benefit from their efforts to improve land. It’s worth noting that the subject property in question isn’t the only one to benefit from an increase in value. If for nothing else, commercial redevelopment has become synonymous with a domino effect of sorts; it’s not uncommon for the prices of nearby properties to be buttressed by the increase of the building being remodeled.
Redeveloping a building can improve its own value, which begs the question: how does the improvement of one property inherently impact those around it? The answer is simple, and perhaps even something most real estate investors — commercial or residential — are already familiar with: comparables. In their simplest form, comparables (or comps) are a real estate appraisal concept used to identify properties with characteristics that are similar to a subject property whose value is being sought. They are, more or less, one of the most accurate strategies used to determine the value of a similar property within close proximity. In short, if the property you are using as a comp has appraised at a higher value, the subject property will benefit.
Job Creation
Even more so than residential projects, commercial redevelopment is responsible for stimulating the economy. The larger and more complex nature of a commercial property deal will require more boots on the ground. It shouldn’t surprise anyone to hear that more people will be involved in a commercial project than a single-family home. That means more contractors to remodel the interior, more painters, and perhaps even more litigation. For better or for worse, a commercial redevelopment project will require a lot more work, and a lot more people.
Every dollar spent on commercial redevelopment — in one way or another — is put back into the community. The next time you buy nails form the local hardware store you are stimulating business on a level that is magnified exponentially, at least when you consider how many people have the same idea. The plumber you need to be sure everything is in working order will need to come from somewhere. When it comes down to it, the needs of a commercial redeveloper create a demand for local business, and that demand translates into jobs.
Just off the top of my head, I can expect a commercial redevelopment project to enlist the following services:
- Contractor
- Mortgage broker
- Inspector
- Appraiser
- Closing agent
- Notary
- Title insurance agent
- Insurance agent
- County clerks
- Attorney
- Handyman
- Electrician
- Plumber
- Roofer
- Painter
- Mason
- Investor
Remember, when you are redeveloping a commercial property, there is a good chance you are helping a lot more people than you may be aware of.
Free Up Available Money Supplies
Less pronounced than that of job creation, but nonetheless important, is the impact commercial redevelopers have on financial institutions. While it’s true you may enlist the services of a mortgage broker, your position in a community extend far beyond that of job creation. It’s entirely possible for commercial redevelopers to ease the burden of nonperforming loans on the books of financial institutions and improve available money supplies.
For what it’s worth, banks aren’t in the business of holding on to properties, especially those of the non-performing variety. When a property is foreclosed on and repossessed, it is a drain on the institution’s money supply. Acquiring non-performing loans provides banks with more work and no monetary gains. Therefore, those that continue to accumulate non-performing loans (foreclosures) are subjected to a significant financial burden.
Fortunately, the same properties placing a burden on banks have become a commodity for commercial redevelopers. Banks want to get rid of non-performing loans, and commercial redevelopers are more than happy to take them off their hands; it’s a win-win. Investors are given access to bargain prices and banks no longer have to maintain the properties draining their money supply. The excess capital banks hold on to can be expected to account for better loans at lower rates for local businesses.
Community Revitalization
Commercial redevelopment has a resounding impact on the local community, and the extent of the benefits are only limited by the building itself. The right project could very well buttress an entire community. It’s possible for a commercial real estate project to spearhead a massive job opportunity movement. At the very least, any business that buys the property will need employees to fill it. Those jobs infuse the local economy with capital; capital that can go a long way in revitalizing a neighborhood.
How to Choose the Right Commercial Property Maintenance Company Partnership
/in UncategorizedAt Commercial Asset Preservation (CAP), we understand that commercial property owners and retailers wear many hats! Some of the many priorities they juggle include operating their daily business and managing finances and personnel. Of equal importance is the physical appearance of their properties. Are the properties inviting to the consumer, the tenant and city officials? In order to keep tenants happy and to make their property appealing to consumers, commercial property owners and retailers seek property maintenance companies to take on a multitude of tasks from landscaping to plumbing and remodeling.
Choosing a property maintenance company that your organization can trust is invaluable to keep your facilities in great shape. As experts in commercial property repairs and maintenance across the United States and Canada, here are some tips to consider when selecting your maintenance team.
Understanding Your Needs and Expectations
It is essential to have a clear idea of the type of assistance you need from the property maintenance company and what tasks you expect them to perform. Do you want your maintenance team to provide repairs on an as needed basis or do you want them to perform preventative maintenance, or both? Do you only want the property maintenance company to work on the inside of your property or do you want them to maintain outdoor areas, such as parking lots and landscape, or both the inside and outside?
Finding a provider that specializes in the services you require and has a track record of success is critical. At CAP, our staff has provided property maintenance, repairs, and inspections at more than one million properties.
Consider Property Location When Choosing a Provider
An important factor when determining the correct maintenance provider for your facility needs is to consider the location or multiple locations where your properties operate. Do you need help with one property, multiple properties in a regional area, or 30+ properties located across the country?
Most property maintenance companies can provide service in specific regional areas or in large cities, but struggle to provide services in rural communities. Many of our customers choose CAP because we cover all of the United States and Canada without any quality or delivery time difference from one location to the next. In fact, CAP performs as much work in rural communities as it does in metropolitan areas.
Therefore, you no longer need to search for individual vendors to repair an entry door at your operating retail center in Atlanta or winterize your vacant office building in Zigzag, Oregon. Simply contact CAP and services in both communities are handled promptly using its extensive network of licensed local maintenance professionals.
Screen Potential Providers
You should screen your property maintenance company just like you would a tenant at your building or a potential employee. Conduct research to check into their background, whether they work with companies such as yours, and always ask for references. Find out how long upper management has been in place. Learn how they plan to communicate with you. Will there be dedicated personnel for you to speak with? Determine the hours that they operate and who answers the phone during non-standard hours. If you use an external facilities maintenance data platform, does the property maintenance provider have experience working with that system? Conduct research on the Internet to see if the property maintenance provider is involved in legal issues or has problems paying their vendors in a timely fashion. These extra steps take time, but they are worth it to ensure you choose a reliable and trustworthy company to work at your property.
Commercial Asset Preservation feels confident in saying that it has experienced nearly every conceivable scenario of what can happen to a building. We use our experience and extensive contractor resources to provide clients with a cost-effective solution that places their property in a condition that keeps tenants and municipalities happy and makes their property appealing to consumers. Let us use our know-how to help simplify your property maintenance needs. Contact CAP to discuss your property maintenance needs at 801-461-8250 or inquiries@commercialpreservation.com.
Columbus plans to transform nearly vacant Fair Oaks Mall
/in UncategorizedReprinted from WTHR
COLUMBUS, Ind. (WTHR) – Even with a strong start to the holiday shopping season, brick-and-mortar shopping malls are struggling.
In fact, America’s malls haven’t been this empty in years, with tenants vacating store after store.
That includes Fair Oaks Mall in Columbus.
But the city has a unique plan to transform the space into a community recreational and sports tourism complex.
It’s expected to be a record-setting Cyber Monday. But that online shopping surge against a sobering backdrop for brick and mortar malls, where this year, mall vacancies hit a seven-year high.
Some of those massive buildings are so empty, they become eyesores in their communities.
That was the worry in Columbus, where Fair Oaks Mall lost two of its anchor stores last year. Most of its other tenants left, too. The mall is only 30% occupied right now: 400,000 square feet on 36 acres, nearly abandoned.
“Our fear was that it would continue to deteriorate,” said Tom Brosey, a consultant hired by the City of Columbus to help with buying and transforming the mall. “We do not want flea markets, fireworks or just general deterioration of the property.”
So the city stepped in and purchased the property for $5.9 million. Partnering in the project are Columbus Regional Hospital and the Heritage Fund Community Foundation of Bartholomew County.
Instead of a place to buy stuff, this mall will be a place to do stuff: a recreation and sports tourism complex meant to draw people regionally to Columbus for tournaments and give neighbors indoor recreation and community classes.
“That’s one of our prime objectives is to provide the Parks and Rec Department with indoor programming space for all sorts of activities. There will be space for athletic programming, sports, but also cooking classes, arts programming, wellness programs from the hospital,” Brosey explained.
Right now the ice rink is one of the few indoor sports facilities in Columbus. Brosey says parks and ballfields outdoors are plentiful, but city leaders saw the mall as a potential place to increase indoor recreation.
“We would like turf fields that would be used for all diamond sports – softball, youth baseball and soccer, rugby, lacrosse, all of those sports,” Brosey said.
He says some existing stores may not have to leave the mall. Dunham Sports, the remaining anchor store for example, could compliment a recreation complex.
Read the original story here
Fed Up With Vacant Storefronts, Residents Force Cities To Punish Retail Landlords
/in UncategorizedReprinted from BisNow
Coast to coast, bustling retail meccas used to embody a decidedly American pastime: shop till you drop. But empty storefronts across the U.S. have cropped up in places that go far beyond the “retail apocalypse” that has battered suburban malls — and some municipalities are fed up. From retail corridors nestled in some of New York’s trendiest neighborhoods to wealthy bedroom communities just outside of Boston, vacancy signage is becoming more common than glitzy placards announcing a big sale. Bisnow/Julie Littman Empty ground-floor retail space in downtown San Francisco Local governments, wary of landlords who choose to keep their properties empty — sometimes for months and years in the hopes of landing a deep-pocketed tenant — are now responding by exacting financial penalties against these proprietors.
“There was uproar from residents over what these [landlords] were doing and how they were getting away with murder,” said Ali Carter, the economic development coordinator for Arlington, Massachusetts. “
Residents just see a vacant storefront and wish it was a coffee shop or bookstore. They’re peeved.” Arlington began its measure in early 2017. It requires landlords to register with the city and charges them $400 annually for each vacant storefront. When the fees were first levied, there were 17 empty storefronts in Arlington Center. Only six remained by the end of the year.
Larger cities, like New York and Boston, are mulling similar measures. Retail vacancies in Manhattan’s West Village neighborhood were up to 11.3% in June — and some parts of SoHo have even hit 20%. In Boston, vacancy rates on the city’s high street of shopping, Newbury Street, were around 10% at the end of 2017. A retail vacancy rate of 5% is generally accepted as the industry standard for a healthy market, according to brokers. But landlords and developers suggest vacancy fees are not the best solution.
“It’s forcing capitulation, and it’s the government injecting itself into the marketplace to get a result they don’t understand,” Fisher Bros. partner Winston Fisher said. Fisher, whose family-run company is one of the largest developers in New York, and others suggest more market-driven solutions, such as pop-up retailers or different leasing agreements, to fill those empty spaces may be better for the long-term support of retail in a community. But even as landlords explore such alternatives, several cities are moving forward with vacancy fees.
Taxation Until Reactivation Wikimedia Commons/Tim Pierce The Capitol Theater building in Arlington, Mass. Other cities are hoping to replicate Arlington’s visible success. Carter has been called to testify on the city’s measure in municipalities across the country. She said, however, each region has to tailor its vacancy regulation to fit market conditions.
“Whatever sort of solution they come up with has to be tailored to their community,” she said. “For the 700 or so businesses in our town just outside of Boston, this is not Greenwich Village. It’s a totally different scenario.” New York City Mayor Bill de Blasio has proposed a fee or tax to penalize landlords with vacant retail space.
Other city leaders are advocating a vacancy tax on commercial strips. In San Francisco, neighborhood commercial districts such as the Castro and the Mission District are seeing an increase in vacancy rates, according to a February report by the San Francisco Office of Economic and Workforce Development. Sales tax revenue slowed between 2015 and 2016 and the demand for ground-floor retail space has declined.
In response, Supervisors Aaron Peskin and Jane Kim are leading the fight for a vacancy tax. Kim told hyperlocal news site Hoodline the Mayor’s Office of Economic Development and small business commission should do more to fill vacant spaces. She would consider a vacancy tax “to encourage landlords to rent out these spaces.” Peskin and his staff told Bisnow he is working on a draft to include a vacancy tax on a future ballot.
Boston City Councilor Matt O’Malley is pursuing vacancy penalties in his city, inspired by Arlington. Cities see storefront vacancies as a missed opportunity to generate sales tax, which pays for city services, said Lee & Associates Pasadena Founding Principal Dan Bacani, who once served as an economic development consultant for the city of Arcadia, California.
Arcadia, about a 17-mile drive northeast of downtown Los Angeles, is not proposing a vacancy tax but, like many cities across the nation, is grappling with how to deal with empty storefronts. “Some cities have poor opinions of landlords because the space is vacant,” Bacani said. “But implementing a tax will only have a negative effect and further hurt relationships.”
Read more at: https://www.bisnow.com/national/news/retail/fed-up-with-vacant-storefronts-residents-force-cities-to-punish-retail-landlords-91715?be=%7B%7Bemail%7D%7D&utm_source=Newsletter&utm_medium=email&utm_campaign=mon-13-aug-2018-000000-0400_new-york-re?utm_source=CopyShare&utm_medium=Browser
A Macy’s Goes From Mall Mainstay to Homeless Shelter
/in UncategorizedReprinted from The New York Times
ALEXANDRIA, Va. — Karleen Smith used to work at the Macy’s in Landmark Mall, putting price tags on summer dresses, housewares and the latest styles of shoes.
On Saturday, Ms. Smith, 57, returned to her former store, not as an employer or a customer, but as a resident.
The former Macy’s in this vacant shopping mall outside Washington has been transformed into a homeless shelter.
“It’s weird to be moving into this building. I used to work here,” she said inside the shelter’s common room, which was once the men’s department. “It’s called survival.”
As shopping malls struggle to survive in the era of Amazon, communities are looking for new uses for all the retail space. Some empty stores are finding another life as trampoline parks, offices, college classrooms, and churches.
At the vacant Macy’s in Alexandria, the Carpenter’s Shelter, a nonprofit group, moved into its temporary home last weekend, 15 months after the last shopper rang out. The former store now provides 60 beds, hot meals, and showers for families and for single men and women who are having trouble finding a place to live in a city with a scarcity of affordable housing.
The Landmark Mall was once at the vanguard of shopping.
Opened in 1965, the mall housed the region’s most fashionable department stores, Hecht’s, Woodward & Lothrop and Sears & Roebuck. Boys came to buy their first suit at the haberdasher, and teenage girls could get their shoes dyed to match the color of their prom dress.
Alexandria’s former mayor William D. Euille remembered playing the clarinet in the high school band at the mall’s opening ceremony. “It was the economic engine of the city,” he said.
Landmark tried to adapt over the years. It began as an open-air shopping center and went through an overhaul in the 1980s to enclose the property.
Eventually, the mall succumbed to retail’s propensity to chase after newer, flashier spaces. Developers built larger malls with more upscale brands nearby in Pentagon City and Tysons Corner, siphoning customers away from Landmark.
Landmark’s original anchor stores either have been bought out, went bankrupt or are clinging to life — like many in the retail business. Last year, 6,985 stores closed in the United States, a record number, according to Coresight Research, a retail analysis and advisory firm. This year, retailers are on a pace to close roughly 10,000 stores.
In its final years of operation, the Landmark’s tenants included two dollar stores and a tax preparer. Only the Sears is still operating. A lone, blue inflatable figure dances on the store’s roof, beckoning shoppers.
To read the full article, visit the link here: https://www.nytimes.com/2018/06/13/business/macys-homeless-shelter.html?rref=collection%2Fsectioncollection%2Fbusiness&action=click&contentCollection=business®ion=stream&module=stream_unit&version=latest&contentPlacement=1&pgtype
Boston City Councilor Eyes ‘Vacancy Fee’ To Tackle Empty Storefronts And Homes
/in UncategorizedOne Boston politician is tired of seeing vacancy signs in even the city’s poshest neighborhoods. Boston City Councilor Matt O’Malley announced Monday he will introduce an order for a hearing at Wednesday’s Boston City Council meeting to address vacant properties throughout the city. The move comes in response to empty storefronts in high-demand business districts like Back Bay and vacant units in luxury multifamily buildings. The order is expected to include data collection on vacancies throughout Boston. If a fee were to be levied, funds would go toward affordability initiatives or to reduce property taxes for occupied properties, according to O’Malley’s release.
The idea is not unique to Boston. New York City Mayor Bill de Blasio announced Friday he wants to penalize landlords who leave storefronts vacant for long stretches of time while they seek top dollar for rent, the New York Post reports. The move comes as historically high-traffic retail corridors like SoHo are tackling double-digit vacancy rates.
“I am very intere sted in fighting for a vacancy fee or a vacancy tax that would penalize landlords who leave their storefronts vacant for long periods of time in neighborhoods because they are looking for some top-dollar rent but they blight neighborhoods by doing it,” de Blasio said to WNYC.
Read more at https://www.bisnow.com/boston/news/retail/boston-city-councilor-eyes-vacancy-fee-to-tackle-empty-storefronts-and-homes-86904?be=insulm%40commercialpreservation.com&utm_source=Newsletter&utm_medium=email&utm_campaign=thu-12-apr-2018-000000-0400_national-re?utm_source=CopyShare&utm_medium=Browser
The Impact Of Commercial Redevelopment On Local Communities
/in UncategorizedReprinted from ThanMerrill.com
Photo credit: ThanMerrill.com
Commercial redevelopment has become synonymous with the most lucrative exit strategies known to investors. While their commitment is more than that of the average residential project, the returns can be much more impressive. It’s worth noting, however, that returns extend far beyond padding your bottom line. The right commercial redevelopment project can revitalize an entire community in more ways than you may know. The next time you decide to take on a commercial project, make sure you understand just how much your impact may be felt.
COMMERCIAL REDEVELOPMENT & THE LOCAL COMMUNITY
A commercial redeveloper, not unlike their residential counterpart, has a much greater impact on the local community than many can even begin to fathom. Outside of the obvious appreciation redevelopment provides for a subject property, communal benefits extend far beyond the building in question. In fact, you could argue that commercial redevelopment is a viable catalyst to stimulate economic growth in everything from small businesses to individual homeowners. The ripple effect resulting from a proper commercial redevelopment project can have a resounding impact on a community for years — if not decades.
Done properly, commercial redevelopment can improve a local community in more ways than one, and there is no reason your next project can’t be the one to do so.
Appreciation
First and foremost, commercial redevelopment is entirely capable of resulting in a higher price point. Not surprisingly, remodeling a commercial building will increase its value and result in more demand — the two things that make this exit strategy attractive to investors in the first place. With that in mind, residential redevelopers aren’t the only ones that benefit from their efforts to improve land. It’s worth noting that the subject property in question isn’t the only one to benefit from an increase in value. If for nothing else, commercial redevelopment has become synonymous with a domino effect of sorts; it’s not uncommon for the prices of nearby properties to be buttressed by the increase of the building being remodeled.
Redeveloping a building can improve its own value, which begs the question: how does the improvement of one property inherently impact those around it? The answer is simple, and perhaps even something most real estate investors — commercial or residential — are already familiar with: comparables. In their simplest form, comparables (or comps) are a real estate appraisal concept used to identify properties with characteristics that are similar to a subject property whose value is being sought. They are, more or less, one of the most accurate strategies used to determine the value of a similar property within close proximity. In short, if the property you are using as a comp has appraised at a higher value, the subject property will benefit.
Job Creation
Even more so than residential projects, commercial redevelopment is responsible for stimulating the economy. The larger and more complex nature of a commercial property deal will require more boots on the ground. It shouldn’t surprise anyone to hear that more people will be involved in a commercial project than a single-family home. That means more contractors to remodel the interior, more painters, and perhaps even more litigation. For better or for worse, a commercial redevelopment project will require a lot more work, and a lot more people.
Every dollar spent on commercial redevelopment — in one way or another — is put back into the community. The next time you buy nails form the local hardware store you are stimulating business on a level that is magnified exponentially, at least when you consider how many people have the same idea. The plumber you need to be sure everything is in working order will need to come from somewhere. When it comes down to it, the needs of a commercial redeveloper create a demand for local business, and that demand translates into jobs.
Just off the top of my head, I can expect a commercial redevelopment project to enlist the following services:
Remember, when you are redeveloping a commercial property, there is a good chance you are helping a lot more people than you may be aware of.
Free Up Available Money Supplies
Less pronounced than that of job creation, but nonetheless important, is the impact commercial redevelopers have on financial institutions. While it’s true you may enlist the services of a mortgage broker, your position in a community extend far beyond that of job creation. It’s entirely possible for commercial redevelopers to ease the burden of nonperforming loans on the books of financial institutions and improve available money supplies.
For what it’s worth, banks aren’t in the business of holding on to properties, especially those of the non-performing variety. When a property is foreclosed on and repossessed, it is a drain on the institution’s money supply. Acquiring non-performing loans provides banks with more work and no monetary gains. Therefore, those that continue to accumulate non-performing loans (foreclosures) are subjected to a significant financial burden.
Fortunately, the same properties placing a burden on banks have become a commodity for commercial redevelopers. Banks want to get rid of non-performing loans, and commercial redevelopers are more than happy to take them off their hands; it’s a win-win. Investors are given access to bargain prices and banks no longer have to maintain the properties draining their money supply. The excess capital banks hold on to can be expected to account for better loans at lower rates for local businesses.
Community Revitalization
Commercial redevelopment has a resounding impact on the local community, and the extent of the benefits are only limited by the building itself. The right project could very well buttress an entire community. It’s possible for a commercial real estate project to spearhead a massive job opportunity movement. At the very least, any business that buys the property will need employees to fill it. Those jobs infuse the local economy with capital; capital that can go a long way in revitalizing a neighborhood.
Empty big-box retail stores a growing problem (or opportunity) for suburban Detroit
/in UncategorizedReprinted from www.freep.com
Empty retail stores are on the rise in some cities. So are creative solutions to filling them. Wochit
For clues to what may happen to all those empty big-box stores and ailing shopping centers in suburban Detroit where people once swarmed, look to the shopping district around Westland’s namesake mall.
When retailers such as Value City, Circuit City, Service Merchandise and Macy’s at Westland Shopping Center closed, they left behind large and vacant store buildings, a type of retail space that has gotten challenging to fill amid the explosive growth of online shopping and consumers’ changing shopping habits.
A few of these shuttered stores were eventually refilled with new stores. Others were transformed to house businesses that aren’t retail. Some still sit vacant, and one big box was torn down.
While Westland has seen a particular abundance of large store closings, retail and development, experts say that suburbs across the region have become over-saturated with stores as more shopping moves online and traditional retailers downsize.
There is general agreement that southeast Michigan now has more empty big-box and midsize box stores than retail tenants to fill the space.
“There’s going to continue to be closures, without a doubt, because we’re over-stored,” said Frank Monaghan, president of Monaghan & Company, a commercial retail brokerage. “There are a lot of areas in the Detroit area where I don’t see retail occupying these buildings ever again.”
Struggling retailers like Kmart, Sears and JC Penney — all known for big stores — have been closing dozens or even hundreds of locations a year. And there is no indication this will stop. That means more Michigan cities will be dealing with empty retail boxes and their negative effects on nearby shopping centers.
“It’s not only in Michigan, it’s nationwide,” said Ron Goldstone, senior vice president at NAI Farbman, the Southfield-based real estate firm.
Read the full article here.
New life for long vacant department store gem
/in UncategorizedReprinted from Shopping Centers Today
For three decades the once-grand former department store stood empty. But a team of developers has restored and converted the 400,000-square-foot Hahne & Co. building, in downtown Newark, N.J., into a mixed-use project with the city’s first Whole Foods store and 75,000 additional square feet for retail.
The renovated building also features an arts-and-culture center operated by Rutgers University–Newark, plus 160 new apartments — 64 of which are set aside for low-income and working families. The new homes are located on the third and fourth floors of the existing building and also in a new, nine-story residential building on the corner of New and Halsey streets, which will connect to the Hahne building through a shared lobby and public atrium. Chef and restaurateur Marcus Samuelsson has plans to open a 2,250-square-foot restaurant in another part of the building.
The Hahne & Co. department store was designed by Goldwin Starrett and built by local businessman Julius Hahne in 1901. It was the first commercial building in Newark designed specifically as a department store. The art-deco store was the company’s flagship and boasted a spectacular four-story atrium in the center of the building. In 1987 Hahne was sold to May Department Stores Co., owner of Lord & Taylor, and the building has remained vacant since then.
The building was listed on the National Register of Historic Places in 1994. The restoration preserved key elements of the structure, including the facade, the original signage and the expansive skylight. This skylight was dismantled, fully restored and reinstalled in the new retail arcade as a nod to the department store’s dramatic former shopping atrium.
The $174 million renovation was financed through a partnership of public, nonprofit and private groups, including sizable commitments from the New Jersey Housing and Mortgage Finance Agency and the New Jersey Economic Development Authority. Private equity was provided by L&M Development Partners, Prudential and Goldman Sachs, and debt was provided by Citi Community Capital, Morgan Stanley and three nonprofit community development financial institutions: New Jersey Community Capital, the Low-Income Investment Fund and The Reinvestment Fund. Beyer Blinder Belle, a New York City firm specializing in historic preservation, was lead architect. New Jersey–based Inglese Architecture & Engineering provided architecture, mechanical, electrical, plumbing and construction administration services.
Read the full article here
As department stores exit, mall makeovers begin
/in UncategorizedReprinted from The Chicago Tribune
Illinois has about 60 major malls, the majority in the Chicago area, and seven outlet malls that collectively house over 6,000 stores, according to Mallsinfo.com, which tracks the industry. However, a significant number probably won’t survive the seismic retail store shake-up that’s underway.
Nationally, an estimated 300 malls — about a third of the total number — are expected to close over the next 10 years, according to industry research. That’s a conservative estimate that likely will accelerate as digital buying increases and inflicts greater pain on the bottom lines of bricks-and-mortar retailers, experts add.
It’s no huge surprise that malls catering to upscale shoppers in more well-heeled communities have a better chance of surviving the loss of a major tenant or shakeout. If a mall can replace a Macy’s with a Von Maur, a high-end department store, it’s a manageable adjustment.
Moreover, retail mall developers are trying to re-energize these open spaces by luring more restaurants, gyms or entertainment venues. For instance, since 2011 the locally based General Growth Properties has invested nearly $1.5 billion nationwide to freshen up 91 vacant or near-vacant department stores and mall spaces.
Read the full article here: http://www.chicagotribune.com/business/columnists/ct-mall-makeovers-robert-reed-112-biz-20170111-column.html
Fall Of The Mall? How Mergers And Millennials Are Changing An American Icon
/in UncategorizedReprinted from www.forbes.com
In Dearborn, Michigan, Lord & Taylor has been tailored for Ford.
The Fairlane Town Center in suburban Detroit is retrofitting the former department store space and several other vacancies to accommodate offices for Ford Motor F +1.32% Co. The automaker will move 2,100 workers to the mall as it converts 240,000 square feet of former retail space into a product-planning center.
If it sounds unconventional, that’s the point. “Most major malls are overbuilt, meaning they can’t support the square footage they have allocated to retail,” retail analyst Jeff Green toldMichigan Live for a story about the project. “Which is why they’re starting to look at nonretail uses being brought on the mall site.”
True enough, Fairlane is one of many malls across the country signing on non-traditional, high-traffic tenants as mall vacancies rise. Retail mergers and consolidations have resulted in fewer traditional department store anchor options. And younger consumers, accustomed to round-the-clock digital stimulation, are more likely to find the standard mall, with its cavernous walkways and recurring terrain of familiar shop windows, boring.
Roughly 200 U.S. malls are at risk of shuttering in the coming several years, according to Green Street Advisors. The analytics firm also estimates retailers will need to close about 800 locations, or a fifth of total mall anchor spaces, in order to achieve sales productivity of the mid-2000s.
That’s a lot of wide-open retail space. The risk for mall operators is falling for seemingly sexy new tenants that may not have the staying power of experienced retailers that better understand their market bases. Experienced retailers such as Apple AAPL -0.67%, which has installed glass staircases and Edwardian decor to complement the locales of its many locations. Or custom menswear chain Alton Lane, which serves cocktails and conversation to better understand its customers.
Which leads to the question: If today’s major mall can serve as a planning center for a major automobile manufacturer, what will the mall of tomorrow hold? One hint: To survive, it must serve the shopper’s desire to connect and preserve the shared, relationship-based shopping experiences people long for.
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