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Feature Article, February 2006
Lifestyle Leaders
Poag & McEwen has led the field in lifestyle center development, and the company shows no sign of slowing down.
Brianne Gloski
For Poag & McEwen Lifestyle Centers, developing a lifestyle center was not always as easy as it is today. The company's first centers were products of evolution, with no previous successes or failures to look to for guidance. Retailers, lenders and other retail industry professionals were hesitant to get involved in these centers; there was too much at stake and the centers had no proven track record of success…yet.
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The 800,000-square-foot Promenade Shops at Shadow Creek development, located in the Houston suburb of Pearland, Texas, will also be home to a Bass Pro Shops, a theater, a hotel and close to 100 specialty shops and restaurants.
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Fast forward 20 years and the lifestyle center concept is so widely accepted that retail professionals are clambering to get involved in Poag & McEwen projects. The company, which coined the term, “lifestyle center,” currently has more than $1 billion of lifestyle centers in the development stages. According to Terry McEwen, president of Memphis, Tennessee-based Poag & McEwen, the company has been doubling its office size every 2 years. “We're gearing up our company to handle roughly half a billion dollars of new development every year, two to three centers per year, and we're just about there for having the appropriate staff to handle that.”
To envision a new lifestyle center, the company consults retailers, landowners, cities and brokers to locate the perfect site for a center.
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The Shops at Saucon Valley, Lehigh Valley, Pennsylvania, is scheduled to open in October.
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With the help of a sophisticated software program and market research department, Poag & McEwen has the ability to search the country by certain demographics and find the profile that matches up to their criteria for a successful location. Location is not the only important factor in designing a successful lifestyle center; a strong, versatile tenant mix is what brings the customers back. “We have a basic group of retailers that are in most properties and [we] add in some regional chains and locals,” says McEwen. “But a vast majority are the national specialty shops and restaurants.”
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The 700,000-square-foot Promenade Shops at Orchard Valley, Manteca, California, will be anchored by Bass Pro Shops.
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The retailers initially needed some convincing before they located in lifestyle centers because of their strong comfort levels with the regional malls and department stores. “As time has gone by, the track record has proven they can do better sales in lifestyle centers than in malls with less cost, so they have bigger profit margins,” says McEwen. “[Now] just about all the retailers are receptive to being in lifestyle centers and [for] many of them, it's their preference.” Even department stores, which were slow to catch on, are now interested in being a part of lifestyle centers. Half of the company's new projects contain department stores, but Poag & McEwen has discovered that they do not really increase the sales volume of the specialty shops and restaurants; however, in certain situations they can create a regional draw for the project. Restaurants are also an important factor for making a lifestyle center successful. Each Poag & McEwen project usually has between six and 12 high volume restaurants. “They're our mini anchors to these projects,” says McEwen. “They add to the lifestyle component.”
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The Shops at Briargate, Colorado Springs, Colorado.
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Another draw for customers is the variety of amenities added to the centers. The Promenade Shops at Centerra, which recently opened in Loveland, Colorado, is home to an ice skating rink in the winter months, and during the warmer seasons, it will be converted into an amphitheatre. Other project amenities include a children's play area, several fountains, a fire pit area, a nature trail with a sculpture park that ties into the shopping center and numerous public gathering areas. The 700,000-square-foot Centerra development also includes Foley's (which will be converted to a Macy's in the future), Dick's Sporting Goods, a movie theater, Barnes & Noble, P.F. Chang's China Bistro and 80 other shops and restaurants. Currently, Poag & McEwen has five centers under development. Slated to open in October 2006, the Promenade Shops at Saucon Valley, located in the Lehigh Valley area of Pennsylvania, features a Rave movie theater and 60 to 70 shops and restaurants in the first phase, which will be 450,000 square feet. On the other side of the country, The Promenade Shops at Dos Lagos in Corona, California, is anchored by a movie theater. The 350,000-square-foot first phase, set to open in August 2006, contains 70 shops. The 250,000-square-foot second phase is set to open in late 2007.
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Evergreen Walk, South Windsor, Connecticut.
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Two projects are scheduled to open in fall 2007: The Promenade Shops at Orchard Falls and The Promenade Shops at Shadow Creek. The Promenade Shops at Orchard Falls is located in California's Central Valley. The 700,000-square-foot project will feature a Bass Pro Shops, a movie theater, a department store and 80 specialty shops and restaurants. The 800,000-square-foot Shadow Creek development, located in the Houston suburb of Pearland, Texas, will also be home to a Bass Pro Shops, a theater, a hotel and close to 100 specialty shops and restaurants. Poag & McEwen's first entry into a vertical, urban-type project is the Highland University Shops in Memphis, Tennessee. Located across from the University of Memphis, the mixed-use project will feature 80,000 square feet of retail space and 350 residential units. The project is scheduled to open in 2007.
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Poag & McEwen opened Evergreen Walk in South Windsor, Connecticut, last year.
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The Promenade Shops at Evergreen Walk, which opened last year in South Windsor, Connecticut, near Hartford, has been so successful that the company is increasing its size. Poag & McEwen is adding 90,000 square feet to the 285,000-square-foot project. The second phase is scheduled to open in 2007. Several of the projects are part of larger, master-planned communities. For three of the projects, Poag & McEwen was sought out by developers to create a lifestyle component for the community, and for one of the projects, the company found a master-planned community in a market that needed a lifestyle center. The Centerra, Dos Lagos, Saucon Valley and Evergreen Walk lifestyle centers are all part of master-planned communities. For the company, being part of a master-planned community adds to its draw to that area. “You have that whole live, work, play element where people can have all of their dining, shopping, entertainment needs close to where they work and or live and it draws [us in] a lot more,” says McEwen.
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The Shops at Saddle Creek, Germantown, Tennessee, was Poag & McEwen's first lifestyle center.
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Competition from regional malls would seem to pose a problem for Poag & McEwen, but they aren't worried. If a large number of stores in their lifestyle centers are also included in the local mall, then the company will shy away from developing near that mall. However, many of their projects, such as The Promenade Shops at Evergreen Walk, are close to malls. Rather than deter from the mall's business, the centers complement it. Many of the malls have a tenant mix that is primarily geared towards teenagers. At the lifestyle centers, the tenant mix is geared towards the entire family. The success of Poag & McEwen's lifestyle centers has increased the company's credibility in the retail industry. Leasing, development, and management professionals who were hesitant to get involved before are now realizing that this is the future of the industry. Lenders, who would not invest before, have witnessed the successful track record of the centers and many are now chasing the product.
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The 700,000-square-foot Promenade Shops at Centerra includes Foley's (which will be converted to a Macy's in the future), Dick's Sporting Goods, a movie theater, Barnes & Noble, P.F. Chang's China Bistro and 80 other shops and restaurants.
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For McEwen, the reasons for the company's success is a combination of a great team of professionals and the hard work they put into each center, making it a vital and compelling part of each community. “We work pretty hard at having the highest quality lifestyle centers, highest quality coming in several areas. One being tenant mix, another being architectural detail, third is the amenities to the center, and just making it a very pleasant and compelling shopping experience for the customer.”
©2006 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.
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