Shopping Centers Today International

JAN 2016

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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J a n u a r y 2 0 1 6 / S C T 51 O N T H E G R O U N D : H U N T S v i l l E , A l A . Rocket City is aptly named, thanks to new development With its economy based on defense contracting, naSa's Marshall Space Flight Center and one of the largest industrial parks in the u.S., Huntsville, ala., is unique among cities of the South. "Huntsville was an old cotton town before it became rocket City," said Max Grelier, executive vice president of rCP Cos., a local develop- ment firm. With all of that defense and government business, the economy fluctuates little. and yet the ebbs and flows of local population centers have generated new opportunities in this metro area of some 350,000 people, resulting in a retail construction boom and a host of new stores and restaurants over the past four years. Cabela's is the latest newcomer. "In the last 12 to 18 months, we have seen a lot of development, new grocery-anchored sites and multiuse projects," said David Garnett, a locally based senior as- sociate at Colliers International. "There has been a big push for live-and-play development in downtown, which is undergoing a revitalization." at least three new projects containing retail are in vari- ous stages of development in the downtown, including a Publix supermarket at Twickenham Square. Perhaps the most anticipated project is the $100 million, mixed-use CityCentre at Big Spring, which comprises offices, apartments, hotels and some 50,000 square feet of retail, with rCP as master developer. Indeed, rCP has become very active in its home city, with at least a half dozen retail projects. "Sometimes when it rains, it pours in a good way," said Grelier. "a lot of deals are all happening at the same time." Back during the midrecession period, rCP redeveloped an older shopping center to create Village on Whitesburg, resulting in a host of new-to-Huntsville tenants, among them Bonefish Grill, Panera Bread and The Fresh Market. In many ways the Village on Whitesburg created a blueprint for rCP, which has tried to intro- duce other stores and eateries to the area. Whole Foods Market, which anchors the firm's Shops at Merchants Walk, is a first-timer in northern alabama, though it does have a second store elsewhere in the state. among other Huntsville newbies to appear at rCP developments are Farm Burger, Orange Theory and Zoe's Kitchen. "We have been really inter- ested in creating a mix that addresses the demand by Millennials for different stores and restaurants," said Grelier. Many of the defense-industry and naSa venues are on Hunts- ville's west side, heading toward the bedroom community of Madi- son. Traditionally, there has been a lot of retail in this area, but as Garnett points outs, the new shopping centers have been moving west, leaving behind empty boxes along university Drive. Of course, this has created opportunities. rCP bought the troubled Madison Square Mall from CBL & associates Properties for a reported $5 million. rCP intends to reinvent the site for mixed-use. In the main, the retail sector has been able to absorb the new construction. For the second quarter of 2015, Colliers reported that metro-area retail vacancies had eased to 6.8 percent, from 6.9 percent in the preceding quarter. Generally, properties across all submarkets considered, the data show that rental rates have been stagnant, at less than $15 per square foot, Garnett says. But rates in new developments have pushed upward and now range from about $23 to $26 per square foot. "Huntsville has reached a critical mass in regard to high-paying jobs, high tech and entrepreneurship," said Grelier. "This has been a big impetus to finding good sites and converting those into something special." — Steve Bergsman T h e $ 1 0 0 m i l l i o n C i T y C e n T r e a T B i g S p r i n g

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