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The economy has kept a lot of developers from starting up major projects, but Taubman Centers is not shying away from these types of developments. Just this year, the Bloomfield Hills, MI-based owner of 24 upscale malls has joined a team building the 276-acre mixed-use University Town Center in Sarasota, FL; been tapped to head up the mall component of developer Anthony Marnell III’s M Resort, Spa and Casino in South Las Vegas; and received a long-awaited permit to build a $500-million mall on Long Island, NY. These prospects leave Steve Kieras, the company’s senior vice president of development, optimistic about Taubman’s long term. Just back from the International Council of Shopping Centers’ annual RECon show in Las Vegas, he spoke to GlobeSt.com about what his firm is up to and the market in general.

GlobeSt.com: You’ve just announced a major project in Sarasota, FL. So you’re not concerned about the Florida market right now?

Kieras: We think it’s a great and growing market. We’re already in Orlando with the Mall at Millennia, which is the dominant center there. We’re already in Tampa with International Plaza. We have Dolphin Mall down in Miami, a very successful property, a well as Wellington Green in West Palm Beach, which is doing very well. We also have Waterside Shoppes in Naples. Following along with that type of strategy, we’ve focused on the Sarasota market, which, between Naples and Tampa on the west coast, is a sophisticated, growing, affluent market that is really not served by any critical mass of better retail right now. There is a void in that market for the type of project that we’ve created throughout the state of Florida.

GlobeSt.com: You’ve also announced another Las Vegas project. How important to you is that market?

Kieras: We’re very high on Vegas. We are on the Strip right now with MGM Mirage’s CityCenter, which is the predominant project in Vegas. It’s going to be one of the great projects in the country, and it’s leasing terrifically well. We also have a project that we’re working on with Vestar and other in North Las Vegas, which has lifestyle and big-box components.

Then we looked around the market for growth and income, and the southern part of the market is really where we focused. We settled on the site that Marnell is doing. We believe that will be the dominant location in all of southern Las Vegas which is a high-income growth market with great access. Essentially we are positioning ourselves to be the dominant player, but this is the only project that I’m aware, that has a casino-resort and a department-store anchor all in one. There’s nothing connected all in one that I’m aware of, so this will be unique and offer the residents of all of southern Las Vegas and any tourists that are coming up I-15 a world-class resort and a world-class shopping center.

GlobeSt.com: What is your US development strategy at this point?

Kieras: We like to pursue dominant assets that are anchored by either upper-end department stores or unique alternative anchors, such as casinos. We’re looking at assets that are well-located access-wise in growth markets where there is some affluence and our type of customer and the department store’s type of customer. We are looking at properties around the countries we haven’t announced yet that would fit that mold. We’re not adverse to open air. We just opened the Mall at Partridge Creek here in Michigan which is doing very well, but we like to do projects, whether open air or enclosed, that have a mix of tenancies and anchors that position the asset as being one of the dominant assets in the market. We can then grow that asset and building long-term asset value.

We also look at locations that are hard to replicate. That also means they’re very difficult to get out of the ground, but because of those barriers to entry, whether they be because they’re difficult to put all of the pieces together or they are large and complex, we like that type of challenge. We do it better than anyone, and once we’re able to achieve those types of projects, we have an asset that will continue to grow, and that’s what we’re about as a public company. We’re looking for growth on a steady and continual basis.

GlobeSt.com: Has the downturn changed how you’re doing business?

Kieras: It hasn’t effected us severely. We’re long-term players. We have to take advantage of the downturns, meaning there are opportunities that may not have been there a couple of years ago that we’re looking at. As far as whether or not we do projects, that has not changed. We’re trying to build projects for the long term, and it takes us a long time for these projects to gestate. As the economic cycles head back up, which they will, we’ll be positioned to take advantage of that. We’re always prudent in how we do things and what we do, and we want to make sure we manage our risks and exposure. But we’ve never been a high-volume developer, and we’re well capitalized and have a lot of fixed-rate debt, so we’re not susceptible to having to refinance. All in all, we’re well positioned. We haven’t slowed down and are always cautious by nature, but we are proceeding with our strategy pretty much unabated.

GlobeSt.com: What kind of impacts are you feeling from this year’s rash of store closings?

Kieras: We’re doing fine. We have a broad exposure of tenants and whether times are good or bad, there are always tenants that go through cycles. Some go in business and some go out of business, and there are always ones to replace them. Right now we are not being severely effected by individual retailer situations. We have so many retail tenants across the spectrum and are typically at a more upper price point with tenants that are typically well financed and capitalized. Obviously, the economic times have caused stress to some tenants, but we are not overall, severely impacted.

GlobeSt.com: How did the overall tone strike you at ICSC’s RECon show last month in Las Vegas?

Kieras: It was pretty much like it’s always been for us. We had a lot of activity. We are either expanding, refreshing or building new, and we had no shortage of meetings or interest. As far as we’re concerned the convention was busy as usual and productive.

GlobeSt.com: Do you have any prediction on when we could see a turnaround in the market?

Kieras: I don’t know; it’s anybody’s guess. But we are long-term players, and everything cycles and it will come back up. I just don’t know when that will be. We just want to be prepared. In some markets it’s going to happen sooner than it is in others. The markets that were harder hit were the growth markets, Florida, Nevada, Arizona and California. They were flying higher, so they came down faster. But they are also going to go back up on pretty good projectory , and we’re going to be pretty well positioned in those markets because they still are desirable for people to relocate.

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