Creating ‘Reel’ Entertainment Centers
MGM is partnering with Urban Retail Properties to create movie-themed entertainment destination centers.
Randall Shearin

Imagine a lifestyle center themed like the set of West Side Story. Or a wing of a shopping center with a James Bond theme. Sound like something new? In April, Metro Goldwyn Mayer, Inc. (MGM) finalized an agreement with Urban Retail Properties to develop themed retail centers around the globe. The unique developments will use MGM’s catalog of movies as a backdrop for centers anchored by retail, restaurant and entertainment uses. The two companies are quickly developing a model for a new type of lifestyle center.

Shopping Center Business recently spoke with George Wade, senior vice president of location-based entertainment for MGM, and Ross Glickman, CEO of Urban Retail Properties, to discuss the new venture.

MGM Hollywood Way will utilize MGM’s film library to supply theming for specialized retail environments.

“The consumer is interested in unique places,” says Wade. “They want to get out of the house and they want to be able to do things in places where they can see other people. The challenge has been to provide that experience for the consumer in a way that’s profitable for developers.”

Another factor driving the developments is time. Time has become an important commodity for consumers over the past 20 years. People do not have enough time in their lives to do everything that they want to do.

Wade has been involved in the themed leisure development business for the last 26 years. He started at Walt Disney Productions, working on the development of Epcot Center and Tokyo Disneyland. Throughout his career, he was also involved in a number of retail centers, including The Forum Shops in Las Vegas. In the theme park business, Wade noticed a shift over a number of years from the 1980s to 2000: consumers used to make a trip of several days out of their visits to theme parks; now, they spend the day at the park. The same has been true of the mall: shoppers used to spend a day at the mall, now they go for specific amounts of time and for specific reasons.

The shift has led MGM to believe that there is an opportunity to create a Hollywood-based retail-driven project that will provide consumers with a sense of place that will also drive lifestyle retail sales for real estate developers and tenants.

“When consumers go to dinner, they don’t just want to feed their families, they want to entertain them,” says Wade. “When they shop, they want to be entertained. Entertainment is something that has become a part of our psyche.”

For Urban, the projects are an opportunity to get the company’s hands in the development game, as well as develop properties that are different and exciting.

“It’s always been important for Urban Retail as developers to think outside the box,” says Glickman. “We live in a homogenous society today where ‘sameness’ plagues the development landscape. The Urban/MGM team looks at this from a new perspective; it is important we recognize that consumers — from our research — still regard shopping as a form of entertainment. We are trying to enhance and think differently. In order to grow, you have to be different — you cannot think in a defined way.”

Urban Retail Properties and MGM are partnering to develop entertainment-based lifestyle centers, called MGM Hollywood Way.

“We immediately recognized that we had the same vision for where this hidden industry could go,” says Wade. “We have been working with a great sense of urgency to get a project underway.”

In March, the two companies announced that the first MGM Hollywood Way would be built in Busan, South Korea, as part of MGM Studio Park,  a project that MGM is  building there. Busan is the country’s second-largest city, with a population of 3.5 million people. The MGM Studio Park is a $600 million project that will include a movie studio, theme park, hotel, MGM Hollywood Way and other components. MGM and Urban have identified several sites in the United States where the companies intend to develop MGM Hollywood Way centers as well, and will announce these in the near future. While the Busan project will be the first MGM Hollywood Way to enter the development process, it will probably not be the first MGM Hollywood Way to open. Since that project has a long development period, the Hollywood Way will not open until the theme park is complete, which is several years down the road. Urban Retail Properties has been active overseas for the last two decades. The company, through its subsidiary Urban Retail International, has been providing consulting services for commercial land development and property management internationally since 1990. Assignments have been undertaken by the company in Egypt, Canada, Hong Kong, Indonesia, Japan, Mexico, Poland, Saudi Arabia, Taiwan and Turkey.

“The partnership we are creating with MGM further enhances Urban as an international brand,” says Glickman. “Together, based on our dual expertise, this is a sustaining alliance.”

Rendering of the proposed MGM Hollywood Way centers.

“The reason why we were so stimulated by this partnership is because we think that we can do something that will enable us to build a better mousetrap that can bring a customer base to a lifestyle environment that will captivate and contain the consumer,” says Glickman.

Urban Retail Properties will be the developer in the partnership. Urban will be responsible for finding financing and construction. Urban will also lease and manage the centers after they are developed. Urban and MGM are looking to develop centers in the neighborhood of 250,000 square feet. Some centers in certain markets could be as large as 500,000 square feet. Glickman says that the company is talking to many of the retailers who are locating in lifestyle centers today.

MGM and Urban will not be opening an MGM Hollywood Way in every town in America. They are destination driven projects, meaning they will be strategically placed in particular markets. Glickman says the projects could be in major metropolitan areas or in tourist-driven markets.

“This is a special opportunity, and we don’t want that to dilute itself,” Glickman says. “We certainly don’t want to dilute the MGM brand.”

Using MGM’s movies as placemaking tools, there is no limit to the themes for the projects.

“No one does placemaking better than Hollywood,” says Wade. “That’s what the movies are all about. Movies create unique stories that touch people and places that people want to see. Movies are a window on the world to people.”

MGM is developing the tone and texture — the theme — of MGM Hollywood Way. The company wants to create unique places that will tie in with the movies that are a part of the MGM library. That library consists of 4,000 movies, including some of the most famous-name titles in the world [see sidebar]. MGM wants to use the movies as part of the texture of what the guests at MGM Hollywood Way will experience while visiting the center. Imagine a James Bond-themed corridor, or an area themed like the set of West Side Story. With Urban’s track record of developing world-class mixed-use shopping complexes, the company wants to translate what MGM brings to the marketplace into a great retail experience.

“We want the consumer to have fun with this,” says Wade. “We want to use those movies as part of the texture of what the guests will experience. People want fantasy in their lives. Part of our goal is to bring some level of fantasy to the real estate world to experience things in an emotional way that they don’t normally.”

One aspect that both parties want is to create a class act with MGM Hollywood Way. Just because the projects are themed, doesn’t mean they are going to appeal to the lowest common denominator. Like The Forum Shops, the developers want to have something to appeal to everyone. Lifestyle retail will be the real draw of the centers, with the Hollywood theme serving as a backdrop.

“MGM brings a unique toy box of films and our brand to the table, while Urban brings the fundamental real estate business attributes to the table,” says Wade. “When you combine them, you get a tremendously unique landscape to work from. Our focus, though, is for them to make financial sense and economic sense for a real estate developer, the tenants and the consumers.”