Friday, June 10, 2005

Upscale Discovers Prince William

Town Center Plan Reflects County's Striking Changes

By Jenalia Moreno
Washington Post Staff Writer

If Woodbridge resident Roelinda Frasketi craves dinner at a fancy restaurant, she and her husband drive to Arlington, where the couple lived before moving to Prince William County. If she wants to shop at a gourmet grocer such as Whole Foods, she must once again leave the confines of the county. And shopping for the latest fashions means a hike to Tysons Corner.

Now the Mills Corp., developer of the huge Potomac Mills outlet mall, has plans for shoppers like Frasketi, a nurse and mother of two who moved to the county four years ago. Mills, based in Arlington, is planning to build a "lifestyle center" across Interstate 95 from its outlet mall. The Potomac Town Center would have condominiums, restaurants with sidewalk tables and an outdoor shopping center offering department stores and upscale shops.

The new center, if built as planned in 2007, would not only reflect the growing population and wealth of Prince William but a new direction that the Mills Corp. has been taking, adapting its business to the latest permutation in shopping centers.

The lifestyle center, as defined by the International Council of Shopping Centers, has an open-air plan and at least 50,000 square feet of space devoted to upscale national chain specialty stores. In the Washington area, the council cites Reston Town Center and Bethesda Row as examples.

The Potomac Town Center will be outdoors, and it will be the first of the company's shopping centers to be located near -- but not connected to -- one of Mills's existing outlet malls.

"I think they offer convenience," said David Douglass, a Mills Corp. spokesman, regarding the new-style mall. "They create a sense of place. And like all of our properties, if they're done correctly and done well they serve multiple functions -- a gathering place, a shopping place, a place to recreate."

In 1998, the company made its first break with its traditional outlet mall past, opening the Block at Orange, an open air entertainment center with restaurants in Orange County, Calif. Since then it has been refining the concept, adding more retail shops to the center, according to Douglass.

In the past three years, the company has acquired 22 traditional regional malls and plans to spend $800 million between this year and 2008 renovating several of those malls and some of its outlet malls, converting many into open-air shopping centers, Douglass said. In some cases, the lifestyle centers will be attached to existing Mills outlet malls. The company also plans to build mixed-use lifestyle centers akin to the Potomac Town Center in Chicago, San Francisco and in northern New Jersey.

The company owns 41 properties in the United States, Canada and Europe, that generated more than $8.7 billion in reported retail sales in 2004, according to its annual report.

Mills is not alone in pursuing the upscale, outdoor approach in Prince William. The Peterson Cos., based in Fairfax, have plans for a smaller scale project in Gainesville.

Located on the site of the former Atlas Iron Works steel plant, the company's 117,600-square-foot Atlas Walk town center planned for this year includes retail stores, restaurants and a hotel, said Marc Menick, senior leasing representative for Peterson.

"It's the atmosphere these higher-end retailers like to go in," he said. "It's sort of the trend to go outside of the mall."

In addition, upscale grocer Harris Teeter is planning to open its first store in the county near Gainesville. The 25,000-square-foot grocery store should open in the second quarter of 2007.

Mills opened the 1.5 million-square-foot Potomac Mills outlet mall in 1985, in a different era for the company and the county. Prince William County had a population of 174,067 and per-capita income of $16,731, according to county figures. Today's estimated population is 350,345 and per-capita income for 2003 was $32,849.

And new residents like Frasketi are hungry for more upscale retail options than those offered at area strip malls and Potomac Mills.

"It's so far to drive if I want to go and get something other than discount stuff or last year's stuff," said Frasketi, who spent one morning this week returning items she had purchased at Potomac Mills.

The outlet mall, with nearly 200 merchants including Ikea, H&M and Nordstrom Rack, attracts shoppers from across the state and from across the globe. One morning this week, Beth Walz drove from Fredericksburg with her mother, who was visiting from Indiana, to shop at the Gap outlet, among other stores.

It also lures international tourists, who can exchange their foreign currency for U.S. dollars at a customer service center in the mall. The combination of domestic and international shoppers has made the mall the state's 10th biggest tourist destination in terms of number of visitors. Last year, more than 40.4 million shoppers visited the mall.

With its new shopping center across the highway, Mills doesn't plan to compete with itself. It wants to persuade shoppers such as Frasketi to drive over, instead of heading toward Tysons Corner.

County officials say such upscale shopping has been long-awaited. "For a long time, there was this lag," said Corey A. Stewart, the county supervisor for the Occoquan district, which includes Potomac Mills. "Maybe there was a kind of a snootiness on the part of retailers and developers. They were thinking 'Oh, Prince William is the poor, redheaded stepchild.' "

From time to time, tantalizing proposals have appeared, only to come to nothing.

"We've been hearing about an upscale mall coming since the '70s," said Hilda M. Barg, a county supervisor representing the Woodbridge district, where the Potomac Town Center will be located. "People have had their spirits up and down for years."

Mills plans to open the Potomac Town Center by 2007, pending approval of permits and public hearings. The town center will include 650,000 square feet of retail, 150,000 square feet of office space, 350 residential units and a hotel.

The company is hoping for a Wegmans Food Market, a 25,000-square-foot bookstore and is also negotiating with department store Hecht's.

"This is the biggest thing that's happened," Stewart said.

More luxury retailers are now attracted to the area because of the higher-priced housing in the county, said Stephen Fuller, an economist and director of the Center for Regional Analysis at George Mason University's School of Public Policy.

While average home sales have soared in the county, so has the number of wealthy home buyers. More than a dozen homes with sales prices exceeding $1 million were purchased between January and April of this year.

"It's slowly coming out here, but it's taking a long time," Frasketi said.

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