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MILL VALLEY, CA-Sometimes, we need to see the trees apart from the forest. The impressive array and diversity of our modern retail developments, looked at on the project level, can overwhelm us. These showplaces, and even many power centers these days, are quite literally showplaces, and can obscure something equally important.

That is the extraordinary quality, the high batting average in terms of merchandise selection, display, customer understanding and service, of most all operators these days. Not every concept, chain store or restaurant group makes it to the top of the charts, but the real clunkers are few and far between. The competition is just that good.

I make that point by way of introducing a discussion of two of today’s hottest trends, or modes, of development. They are lifestyle retail and mixed-use development.

Lifestyle retail keeps maturing.

At its core, I define the lifestyle center as a destination center in a convenient location. The advent of lifestyle centers was about bringing upscale, specialty retail closer to a density of more affluent housetops and sophisticated households. In addition to getting closer to the desired demographic, lifestyle centers appealed for their lower true rental costs and the growing desire of retail operators of all kinds to be “destinations of one,” at least with respect to signage, visibility and more direct access to customers.

Now come some of the glitter and gleam. The word lifestyle was applied to these centers for a reason. These centers were impacted by other trends permeating retail, including more thoughtful landscaping and pedestrian design, entertainment-oriented family dining, and an environment meant to restore some of the traditional enjoyment of shopping as a social activity, while also being efficient.

In many ways, the development of the lifestyle centers has been a refinement of the trend to more focused “collections,” with fewer total tenants, than we had already seen in selected upscale regional malls.

Now, the lifestyle center has matured, with developers fitting these collections of smaller specialty stores into varied settings. An anchor may not be present and the sizes (in the 80,000-sf to 150,000-sf range) have dropped below what we would typically think of as a destination. Much of this has been to the good, as we find the very best developers building lifestyle centers to a market demand, as opposed to a prototype or a formula.

Certainly, many of the names do repeat themselves, as major creditworthy national tenants take slots in these developments. But look closely at how these building blocks are being put together. Look at retail expenditure potential, the site plans and locations. Study the tenant lists carefully, and we will find some excellent retail strategies and creative approaches.

If you have affluence and sophistication, you may not need as much density to support this higher-end specialty retail environment. In carefully selected locations, we expect these developments to have a good shelf life. Because these smaller lifestyle centers require less land, city officials may be more receptive to them, especially as downtown substitutes or augmentation. The biggest caveat is making sure that the market is not too small, in terms of population, income or retail expenditure potential.

The implications for mixed use.

The classic components of mixed use are retail, residential, office and hotel.

Mixed use has become popular, as an economic development tool and in efforts at creating more livable environments, whether we are talking about a mature urban area in need of revitalization or an area of robust residential growth looking to find its center.

What works and what doesn’t in today’s mixed-use efforts? I don’t think that has been established yet. Certainly, there is floating up there in the planning ether a notion, some would say a consensus, that there is commercial and social value in achieving around-the-clock use as much as possible. Also, residential mixed-use is high on most folks’ radar screens.

What about retail? In these developments, I think there has been a tendency to go for the gold. Make the retail component of mixed-use an upscale lifestyle center, including novel, high-energy entertainment and restaurant components. But, just as the retail shops of some downtown high-rise office buildings can fall flat –how many execs need a $250 business shirt on a moment’s notice each day? –mixed-use retail can mistake its market.

Instead, the progress that lifestyle centers are making in sizing and tenanting to market demand should be carried over to the retail component of mixed-use development. Perhaps convenience retail, such as a food store, dry cleaner, salon or health club, is more appropriate to a given location. A book superstore, consumer electronics, themed restaurant, blues club, movies, and a family restaurant that we can bring grandma to. Choose wisely. There are only so many aquariums to go around.

Municipalities will sometimes create traction in the opposite direction, working off a dream sheet, or some formula of what mixed use should include. The sharper developers are sharing their market research and experiences with municipalities, teaching them how to add to commercial corridors in ways that enhance, rather than compete with, what is already in place. The result will be better trafficked, more useful, more interesting mixed-use retail.

Jeff Green is president of Mill Valley, CA-based consulting firm Jeff Green Partners. Views expressed here are solely the author’s.

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