The companies vying to set up shops in east Pasco have chosen partners that show what kind of shopping centers they'll set up.
By MARK ALBRIGHT
Published May 26, 2004
LAS VEGAS - The mall brawl in east Pasco County has escalated as two of the three competing developers have added firepower to better put the arm on retail prospects.
Goodman Co., the retail developer of Wiregrass Ranch, signed up Forest City Enterprises Inc. as 50-50 partner in its 600,000-square-foot lifestyle center. Meanwhile ECHO Development, the Pittsburgh developer of the Grove at Wesley Chapel, is close to bringing in Kimco Realty Capital Corp., a New York company that owns or manages more than 700 community shopping centers including 77 in Florida, as partner for its 700,000-square-foot power center.
The partnership choices speak volumes about the types of stores the projects are seeking to line up. Forest City, based in Cleveland, is a major national player with clout among department stores and other chains found in traditional malls. Kimco, which a few years ago was Kmart's biggest landlord, has strip centers filled with the likes of 84 T.J. Maxx/Marshalls, 33 Best Buys and 27 Home Depots.
"We've wanted to get into Florida for some time," said Jim Richardson, Forest City vice president of development. Forest City Enterprises has built several open-air lifestyle centers - such as Short Pump Town Center in Richmond, Va., and Victoria Gardens in Rancho Cucamonga, Calif., and is the developer of many New York office buildings, including a new 52-story home proposed for the New York Times near Times Square.
Bringing in bigger partners not only spreads the risk for developers, it gives them clout with national retailers who prefer deals packaged with several desirable centers in other parts of the country.
"Given the competitive environment we're facing at Wiregrass, we thought it was better to stack our side of the deck a bit," said John Dowd, vice president of Goodman, which still intends to go it alone with another 700,000-square-foot shopping center for big-box stores on an adjacent site on SR 56. "Forest City is among the premier lifestyle center developers today."
The news spread quickly across the floor at the International Council of Shopping Centers' annual leasing mall here this week. About a quarter of all mall and shopping center deals nationally are hatched or closed at the annual bazaar that has drawn 36,000 retailers and developers to a convention floor the size of Tyrone Square Mall in St. Petersburg.
What's at stake in Pasco is a race to claim rights to be the retailing hub of New Tampa and east Pasco as more bucolic cattle ranches are converted to planned communities. Developers see Bruce B. Downs Boulevard and State Road 54 in Pasco turning into the next Dale Mabry Highway. Rose Residential Reports estimates that 15,000 new residents will move into the New Tampa and Wesley Chapel area annually through 2008. That would lift the population to 237,000 and fix average annual household income at $74,800.
Even the developers themselves figure only one or perhaps two of the ambitious projects will get enough retailers to get off the drawing boards. Projects morph all the time with their creators sales pitch of the moment. Until recently ECHO called the Grove the Oakley Plaza - after ranch owner Tom Oakley. Then promoters decided it had potential as a more regional draw that could be built sooner than rivals.
Both the Wiregrass and Grove development teams are fighting for many of the same tenants with Richard E. Jacobs Group, the Cleveland developer planning to round up stores for 2-million square feet of retail space at Cypress Creek Town Center. Jacobs envisions an outdoor center as big as University Mall, anchored by up to three department stores. Nearby would be a 700,000-square-foot power center for big box stores as Best Buy and Lowe's.
All three projects have space reserved for up to 10 sit-down restaurants and a megaplex theater. All three are lobbying for Kohl's, a moderate-priced apparel chain similar to Beall's that has been signing deals as close as Orlando.
None of the new partnerships caused a stir at the Jacobs booth, where Cypress Creek Town Center shares the promotional billing with the developer's similar Gulf Coast Town Center project that opens near Fort Myers in 2005.
Cypress Creek could face some big expenses and development hurdles. The site is dotted with protected wetlands that feed a principal source of potable water for the Tampa Bay region. The project's zoning changes have been stalled until July 27. Jacobs hopes to open the open-air mall by 2007. It is courting major department stores that cater to the moderate- to better-price range customer: Burdines, Dillard's, JCPenney, Sears and Belk. So is Goodman/Forest City, which hopes to pencil in two department stores.
"What is going to drive the opening date is the department stores commiting," said Bill Fullington, vice president of marketing for Jacobs.
Fueling the Grove are a few advantages. It has no wetlands. And while Goodman and Jacobs face a lengthy permitting process for the bigger parts of their projects, the Grove claims it can start building in less than a year.
In fact, Goodman's projects hit a big bump last week. Pasco planners blocked Wiregrass from moving forward until Goodman and its partners convince state regulators development won't clog roads or wreck the environment.
This wave of new retail development is likely to have repercussions farther south. University Mall's lineup of department stores will be threatened with closing, should their owners decide to move to a newer property farther north. "This could be the beginning of the end for University Mall," said John Simon, vice president of development for Taubman Centers Inc., which manages International Plaza.
Jacobs and Forest City are both more interested in landing the tenants found in Tampa malls and luring residents south from Hernando and Citrus counties.
"We're competing for the big box stores, not the mall-type tenants," said Bill Krahe, chief executive of ECHO. "What we're telling retailers is, when people drive south to either of these other two projects, they go right past ours that will be visible from and only a couple of easy right turns off I-75."
