Developing Long-Term Value
As Bayer Properties enters its 23rd year of business, the Birmingham-based firm looks for growth opportunities that create value for both company and community.
Susan H. Fishman

Bayer Properties is celebrating its 22nd anniversary on August 17, opening day of the fourth phase of the company's The Summit Birmingham, one of the largest retail centers of its type in the country. The privately owned, full-service commercial real estate company has achieved regional and national success with its Summit retail centers, featuring an upscale merchandise mix, but always has its sights on other growth opportunities, as well.

“We don't set out to create X number of square feet of new product each year,” says founder Jeffrey Bayer. “We're very niche-oriented, and we want to find the best opportunities where we can create value for ourselves and for the communities we do business in.”

Phase IV of The Summit Birmingham, Birmingham, Alabama.

“The Summit brand was established with national reach in mind,” adds Libby Lassiter, executive vice president of retail development for the company. “We will continue to fine tune the model through Phase IV of our flagship project in Birmingham.”

Lassiter, who formerly headed up the retail redevelopment group at General Growth in Chicago, recently joined Bayer Properties because of its focus on growth through development, as opposed to acquisition.

“Bayer has a unique brand recognition and is a quality developer. This company is a long term holder of real estate, versus a merchant builder, which is another thing that appealed to me,” she says.

The company's roots are on the brokerage side of the business. Bayer started as a tenant rep company in the retail industry and began building small centers and office buildings, but the other side of the operation was providing third-party property management. Today, the firm still has an active tenant representation business and a very active brokerage company.

The Summit Leigh Valley, Bethlehem Township, Pennsylvania.

For its Summit brand, Bayer has a well founded site selection process. Four or 5 years ago, the company, which was limited to operations in Alabama and Kentucky, put together a group to help them learn the United States in a better fashion and create a model for the Summit brand in other parts of the country. Out of that group, the firm has developed Summit projects in Reno, Nevada; and Lehigh Valley, Pennsylvania; and has other sites across the country that are in negotiations or under contract.

“I think we're pretty thorough in our investigative efforts,” says Bayer. “We're primarily looking for opportunities, rather than having others bring them to us.”

Bayer currently has two new Summit properties underway, including The Summit Sierra in Reno, Nevada, with a projected opening of March 16, 2006, and The Summit Lehigh Valley in Bethlehem Township, Pennsylvania, a joint venture with Forest City Enterprises, slated for opening in 2007.

The Summit Sierra, Reno, Nevada.

“The market has experienced dramatic growth and activity,” she says. “Our site has superb regional access, and the retailers have confirmed that fact. Our partnership with Forest City not only strengthens our ability to assemble a top-notch line up of retailers, but also brings key mixed-use components together. So we're looking to have a very successful shopping center, as well as other uses that we think are important for the live/work/play brand that we're building.”

Currently, Muvico, the Florida-based theater circuit, and Target have committed to the project. Other tenants will include a who's who of specialty retailers, as well as many retailers new to Lehigh Valley.

The Summit Sierra in Reno will be an open-air retail destination in a 200-acre live/work/play/shop environment. The project is located at the regionally dominant intersection of Highway 395 and Mount Rose Highway, an area where new housing and upscale developments are responding to high-velocity population and household income growth.

“Reno has opened our eyes to the growth taking place in the western United States,” says Bayer, “and we now, in fact, are opening an office to be able to transact other business out there.”

The development will feature extensive patios, paths, fountains, sitting/shade areas and landscaping. The tenant make up includes 70 shops and restaurants. In addition to Century Theatres and Dillard's department store, Williams-Sonoma, Pottery Barn, Coldwater Creek, J. Jill and Chico's are representative of the type of new retail Bayer is attracting to the region.

Bayer Properties feels that the maturation of the open-air center and the Summit brand has really become the benchmark for other upscale centers. Follow-up is of great importance to the company once it has gotten a project up and running, and is possibly what led to the association with Station Casinos, Inc., a large publicly traded gaming operator who developed and owns the Green Valley Ranch, a high-end boutique gaming hotel/spa in Las Vegas. The company has entered into an agreement to purchase approximately 50 acres of land on the southeast corner of Mt. Rose Highway and Interstate 395 from Bayer for the purpose of building a regional gaming and entertainment project, which will complement Bayer's Summit Sierra. The merging of Station Casinos' gaming and restaurants with a high-end retail lifestyle center has been enormously successful at Station's Green Valley Ranch Resort, Casino and Spa in Henderson, Nevada.

“Stations Casino also saw an opportunity to come into a market such as Reno, which is transitioning from more of a blue-collar, one-industry town, which was gaming, to now a commercial mecca for people migrating from other parts of the country,” says Bayer.

As Bayer continues to grow its Summit portfolio, and development portfolio in general, the company itself is also expanding. The firm's current number of employees is 50 percent greater than it was this time last year.

“To do the projects on the drawing board today, we're going to be growing from 80 to 100 employees by year-end,” says Bayer.