`Fortress mall' spawns cluster retail; investors are paying top dollar
DOUG SMITH
The Charlotte Observer
SouthPark mall's continuing expansion isn't scaring off the competition; it's attracting a broader array of stores and services to the area.
The latest to conclude a lease agreement: Earth Fare, which plans to open next summer at Sharon and Colony roads. The Asheville-based natural and organic foods chain will anchor Grubb Properties' Morrison mixed-use village with a 25,000-square-foot market.
With that tenant signed and situated within the project, Grubb Properties has only 10,000 square feet of ground-level space to fill in its first building, which will have 300 studio to three-bedroom apartments atop shops.
Developers have unveiled new projects and upgrades to existing shopping complexes almost in sync with SouthPark mall's addition of more than 30 stores over the past 2 1/2 years.
That expansion includes mall owner Simon Property Group's adding Nordstrom last year and bringing in Neiman Marcus next year.
"They've turned it into a fortress mall," said Clay Grubb, president of Grubb Properties. "There's not a chance in the next 25 years there will be a competitor to SouthPark mall."
Among the activity around the mall, Crescent Resources and Lincoln Harris plan 90,000 square feet of shop and restaurant space in Piedmont Town Center, an office-residential-retail village. It's to be completed between late 2005 and mid-2006 on Fairview Road, a block from SouthPark.
A 14,500-square-foot Walgreens drugstore is to open in early 2006 at the northwest corner of Sharon Road and Morrison Boulevard. It's part of a larger Harris Land Co. project that will include a new Bojangles' and the relocation of Garden Secrets nursery from Park South Drive.
And the grandfather of Charlotte's mixed-use villages -- 8-year-old Phillips Place on Fairview Road near the mall -- began a process late last year of sprucing up and adding tenants.
Retailers typically like to cluster, adhering to the theory that competition attracts more shoppers from which they all benefit.
"The more retail that goes into an area, the more the national retailers want to be there," Grubb said. "Retail creates its own gravity."
Industry analysts aren't surprised, either, that the SouthPark area is packing them in. It's amid some of the city's highest income ZIP codes and fastest growing residential communities.
And investors don't mind paying top dollar to be there.
Last summer, for example, The Specialty Shops on The Park -- a 26-year-old SouthPark landmark -- sold for $374 a square foot, a price experts believe is the highest per-square-foot ever for a local specialty retail center.
Grubb said he wouldn't be surprised to see that price climb to $500 a square foot within the next five years.
An investor group represented by Charlotte's Aston Properties bought the 64,859-square-foot center, across Morrison from the mall, for $24.25 million.
Earth Fare, which opened its first Charlotte market this year off Interstate 485 at Johnston Road in the Ballantyne area, disclosed plans to occupy the SouthPark space in February.
Now that the chain has worked out details of the lease and the store's layout, Grubb Properties is proceeding with a final design approval process and plans to start construction soon. Site work is under way.
Earth Fare will be a major component of Morrison, a 24-acre redevelopment of the Park South Apartments property. The apartments will be progressively replaced as the mixed-use project grows, Grubb Properties officials said.
The company, headquartered in Charlotte, recently changed the development's name to Morrison from Morrison Place.
Grubb Properties spokesman Steve Biggerstaff said the new name will better reflect the village's "turn-of-the-century neighborhood ambience."
It's also consistent, he said, with in-town neighborhood names such as Dilworth, Eastover and Elizabeth -- "all of which stand alone without development modifiers like `Place.' "
Morrison ultimately will include 127,500 square feet of street-level retail and more than 500 rental apartments and for-sale condominiums and townhomes.
Little Diversified Architectural Consulting is the consulting architect. No contractor has been named.
The initial phase, valued at more than $45 million, "will evoke images of early 20th century urban living," Grubb Properties said. It's to include an acre of landscaped courtyards, pool and clubhouse.
The project is expected to exceed $200 million when completed over several years.
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