Plans to Revamp Shore Mall: A Road (Improvement) Too Far?

Here's an article from Sarah Watson of The Press of Atlantic City regarding plans by the current owner to redevelop the Shore Mall into an "open air plaza" with approximately 600,000SF of retail, restaurant and commercial space.  In essence, the owner, Cedar Shopping Centers, Inc. (CSC), is looking to "de-mall" the Shore Mall.

Anybody familiar with the Shore Mall knows that something has to be done to revitalize it before its too late.  I, for one, am not sure if the local market can support more "open-air" shopping -- there's already a bunch of it in the areas surrounding Shore Mall -- but CSC apparently has had some success with a similar plan in Camp Hill, PA.  Something has to be done with the Mall and the plan -- including a "boulevard-style road network" -- sounds intriguing and like it could fit the vast space available.  (The Mall appears to be on a large parcel of land.)

As noted by Sonny McCullough, Mayor of Egg Harbor Township, where the Shore Mall is located, the key to the plan is off-site road work to improve access to the Mall.  I agree 100%.  Anybody familiar with the area knows that access to/from the Mall is a tangled mess which undoubtedly discourages potential visitors.  (Hand raised.)  The plan apparently seeks to improve access from the Garden State Parkway and to create a dedicated, full-service intersection into the Mall, among other things.  All good things.

That's the good news.  Here's the bad: CSC is seeking grant money for the off-site road improvements.  Good luck w/ that.  Mayor McCullough acknowledges in the article that there is no grant money available -- no surprise -- and it is hard to see when any might become available in today's economic climate.  In other words, don't look for changes to the Shore Mall any time soon.  No grant money = no off-site road improvements = no redevelopment of the Shore Mall.  It all feels like a bit of a dog and pony show.  I'm left with the following questions:

  • What's behind the timing of the article?  There really was no new development or change in the plan and there is an admission that the money to get started is not available.  So why leak the application for grant money?  Who benefits from the timing and how?  Frankly, I can't see it.
  • Who's behind the article.  It seems pretty clear that EHT is behind it.  After all, CSC refused comment whereas the Mayor and Township Administrator are quoted throughout.  The question is why?  To put some pressure on state/federal politicians to find the grant money?  To put pressure on CSC?  Should we be readying ourselves for an argument from EHT that the Shore Mall is "too big to fail"?  

FINAL THOUGHT: I can't help but contrast CSC's wait for grant money w/ the decision of the developer of Gravelly Run Square in nearby Hamilton Township to spend $1M of its own money to extend a dead-end street in order to improve traffic access.  Granted, the scale of off-site improvements is significantly greater ($23M) at the Shore Mall, but the investment by Benderson Development and the fact that they're off the sidelines shows to me a confidence, or belief, in the project.  Meanwhile, I'm not sure at this point how much CSC believes in the success of the Shore Mall.  Here's hoping that they prove me wrong.

Shoppers Value Convenience. Who Knew?

I want to pass along an article from the 7/19/10 edition of the Press of Atlantic City by Sarah Watson concerning a developer's willingness to spend more than a million dollars to extend an existing dead-end so as to create an access road to alleviate area traffic.  For those familiar w/ the area, the planned development is called Gravelly Run Square, which recently received preliminary approvals from Hamilton Township.  It would be across the Black Horse Pike from Hamilton Commons (Regal Movie Theater) and current plans call for 296,000 sf of space within 8 buildings similar in design to Hamilton Commons, which was also developed by Benderson Development, the developer in question.  (Fingers crossed for a Fresh Fields!)  It is expected that work on creating the access road will begin in 2011.

Now, a developer agreeing to create an access road is not news.  Alleviating traffic congestion is admirable in and of itself and SOP to get projects approved.  (Also greatly needed in that area, as the article points out.)  But there is more to it than just reducing traffic and getting the project approved.  For one thing, the access road will benefit commercial properties other than Gravelly Run Square.  For me, though, I love the fact that the developer clearly saw the access road as a way to increase the value of the project.  Check out this quote from the developer:

“In order for businesses to succeed, they need to be convenient and traffic needs to be able to move as efficiently as possible,” Wainberg said, in response to questions as to why a commercial developer would invest so much time and money into an off-site road. “We’ve done projects of this kind everywhere, and we know what it takes for projects to be successful. They have to be well-planned.”

 

In other words, shoppers value convenience.  Duh!  Seems obvious, but not everybody is willing to go that extra mile. (Excuse the pun!)

If you develop/own/manage retail space, is there anything you can do to make the shopping experience more convenient for your visitors?  Granted, you may not be able to do anything about parking or traffic, but are there any smaller or unconventional ways to make the shopping experience more convenient?  If so, wouldn't greater shopping convenience add value to the property? 

ROUND-UP: Retail Traffic

OK, so the latest jobs report was disappointing and people a lot smarter than me are saying that our economic recovery is losing steam.  It's the 4th of July Weekend!  Let's focus on some more encouraging news.  Here are links to some recent encouraging stories from the fine folks over at Retail Traffic:

  • Here's an interesting piece by Elaine Misonzhnik about the growing sophistication of certain landlords' online marketing campaigns.  I was impressed by social network -- called ShopStar -- created by Developers Diversified Realty.  According to the article: "The tenants, including both retail stores and entertainment establishments, can use ShopStar to advertise special events, prizes and giveaways to shoppers. Customers, meanwhile, receive access to information about local properties and can offer feedback on what they think would improve their shopping experiences. Developers Diversified hopes the program will help build brand loyalty."  DDR's social network is a great idea and value-add to tenants.
  • Staying on technology, here is an article from EM regarding a retail-specific, Web-based property management "solutions" site called Workspeed Retail from Workspeed which "helps owners and managers track all property-related tasks, including tenant communications, preventive maintenance, accounting, security incidents and work orders, using a single online application."  There is reference in the article to some initial concern about going paper-less, which I share, but it is clear that web-based applications are the future.  Still, the argument for the application is increased efficiency -- which undoubtedly adds value -- and the leveraging that can be done by smaller management firms w/o in-house software.
  • Check out this post from David Bodamer on the TrafficCourt blog w/ evidence that a "bottom" in CRE pricing may have formed.  (Hey, we'll take our "good news" anywhere we can find it!)  Now, time to start moving up.
  •  Let's finish up w/ a piece from EM about how the flood of tenant concession requests that marked much of 2009 may be starting to subside.  If the brokers featured in the article are on the mark, it sounds like the playing field is starting to level off.  We'll take that as a positive!

There is plenty of other good stuff, both at Retail Traffic and TrafficCourt.  Please check it out.

Here's hoping that everybody has a safe and happy 4th of July Weekend.  Let's all get out there and spend some money.

A New Way for a Garden to Add Value

Can a garden increase a commercial property's value?  Sure, a garden adds aesthetic value, but how about to a property's bottom line?  And, how about if the garden is on the side of the building? 

Welcome to a concept known as a "Vertical Garden," a/k/a a Vegetal Wall, which was conceived by French scientist Patrick Blanc.  (A couple of pictures of existing Vertical Gardens are included w/ this post.)  I ran across the concept in the "First Look" section of the Winter/2009 edition of Development Magazine.

According to the article, Vertical Gardens contribute to reduction of greenhouse gas emissions and can also use recycled water, either from grey water from the building or recycled through the collection bay at the bottom.  Proponents have also found that a building's insulating properties are increased dramatically.

 HOW IT WORKS: A Vertical Garden is composed of 3 parts: a metal frame, a PVC layer and felt.  The frame is hung on a wall or can be self-standing.  It provides an air layer acting as a very efficient thermic and phonic isolation system.  A thin PVC sheet is then riveted on the metal frame.  This layer brings rigidity to the whole structure and makes it waterproof.  After that comes a felt layer that is stapled on the PVC.  The felt is corrosion-resistant and allows for uniform water distribution.  Watering is provided automatically, 4-5 times a day, through a drilled hose running along the top of the Vertical Garden.  Since there is no soil involved, the water must be supplemented w/ low concentrated nutrients through an automatic device.

According to the article, more than 200 Vertical Gardens have been installed around the world.  A check of Patrick Blanc's website shows only 7-8 in the U.S. so far, including installations in Tacoma, WA, and Charlotte NC.

I have no green thumb, but I like the idea b/c it could reduce HVAC costs and it could differentiate the property from competitors

The success of a Vertical Garden depends on using the right choice of plants according to the local environment.  Anybody know what kind of plants might work best in South Jersey?  :)

While a Vertical Garden can be of any dimension, it would seem that the highest return would be found w/ a larger building.  Obviously, not every type of building would be a good fit, as I doubt that a "big box" would want a garden growing on the side of the building, but I would think that a mid-rise office or multi-family building would work, as would certain retail and public buildings.

Who wants to be the first to grow a Vertical Garden in South Jersey? 

 

 

Local Press Round-Up

 Here are a couple of articles from newspapers serving the South Jersey area that caught my eye over the weekend:

The first is by Diane Mastrull of The Philadelphia Inquirer about an upscale multi-family property in New York using a wastewater-recycling system designed, installed and managed by American Water, which is based in Voorhees, NJ.  The name of the property is the Visionaire, located in Battery Park, which opened in September/2008 with LEED Platinum certification, the highest of the U.S. Green Building Council's sustainability standards.

The information about American Water's efforts to become more efficient and green is interesting, but what caught my eye was the fact that the owner's decision to use the system at a cost of nearly $2 million was an incentive from NYC: a 25% reduction in water rates.  According to Russell Albanese of the Albanese Organization, developer of the Visionaire:

The city's rates have been increasing on average 11 percent a year, so the savings over time should become more significant.

The second article was from Erik Ortiz of The Press of Atlantic City about the generally still-bleak outlook for local malls and retail in Atlantic County, NJ.  What caught my eye was the efforts by the new owners of Heather Croft Square to increase occupancy which apparently will include new frontage.

The moral of the stories for me: sometimes you have to spend money to make money.

Smart Phones and Commercial Real Estate

Check out this article by Elaine Misonzhnik of Retail Traffic about how consumers can leverage smart phones while out shopping. Very interesting. Personally, I do a terrible job of using my smart phone but I am smart enough to know that this kind of leveraging is the wave of the future and will only increase. So sayeth Steve Jobs.

Initially, I thought the news was going to be all bad for retailers, with examples of consumers standing in store aisles but ordering merchandise on-line. However, while on-line sales are undoubtedly a clear and present danger to store sales, I soon realized that the news is not all bad for a couple of reasons: 

First, for the most part, in order to leverage the applications discussed in the article, the consumer has to already be at or near the store, which is half the battle for retailers.  (I bet most successful retailers like their chances once people come through the door.)

Second, at least so far, it looks like consumers are using the smart phone applications primarily to help with comparison shopping on "big ticket" items.

Third, and perhaps most important, savvy retailers can embrace the technology and leverage it themselves. For example, as noted in the article, a retailer who provides data for use in the ShopSavvy application by Big in Japan gets an opportunity to lure shoppers with sales and can purchase different add-on services to provide it with a competitive advantage.

I agree with the sentiment expressed by Alexander Muse of Big in Japan: smart phones and the Internet are here to stay and have changed the rules of engagement for retailers.  The sooner that retailers take advantage of the new rules, the better.