Outsourcing Real Estate

REMEMBER THE ALAMO (DRAFTHOUSE)

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Unlike the historic battle, this story ends happily. The Richardson City Council unanimously approved zoning changes to allow the development of the Metroplex’s first Alamo Drafthouse. Now, just don’t get any bright ideas about texting during a flick.

SRS VP Tyler Isbell (standing far left with most of the SRS guys at happy hour at Hillstone’s last week, light blue dress shirts are really in this spring) tells us the former Pep Boys location in the Richardson Heights Shopping Center will be razed and a new 30k SF theater will start construction this summer. He calls the redevelopment a game changer for the shopping center because it will improve the tenant mix and make this “the place to be” in Richardson. The residents are happy, too, Tyler says. The council chambers were full of area residents out to support the project.

Tyler says Richardson Heights is an iconic, regional power center surrounded by demographics (hipster/eclectic types) in the Height Park, Arapaho, and Richardson Heights neighborhoods. City leaders hope the deal will attract other great retailers and spur redevelopment along the I-75 and Belt Line corridor. This will be the first DFW location; word is there could be up to six for new franchise partner, Iced Tea With Lemon, led by Bill DiGaetano. This location will have seven screens featuring 100% digital projection. Alamo Richardson will also have a lounge offering an extensive menu of draft and bottled beers, wine, cocktails, and food.

Henry S. Miller Brokerage’s Jerry Averyt repped the tenant. Tyler and SRS EVP/market leader Frank Bullock (pictured) repped the Houston-based landlord, Hartman Short Term Properties XX, an affiliate of Hartman Income REIT (which acquired the 200k SF shopping center at 100 Central Expressway in January 2011). Additionally, Frank tells us SRS and Cresa formed a partnership that will have Cresa providing retail services to its office and industrial clients, and provide SRS’s retail clients with experience in the office and industrial sectors.

Sponsor Spotlight:
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Chicago Title principal Dennis Noebel (right with Avison Young managing director Brock Wilson as the duo moderated the Bisnow DFW Industrial Real Estate Summit in March) is equating the current economic situation to a war that’s almost over (so don’t be the last guy killed). Dennis sees optimism in two market segments: retail and industrial. Retail starts are twice what the projections were for Q1, and the industrial sector shows momentum. Most of industrial’s progress involves big boxes and the 1M SF user. Dennis says that nobody builds big boxes to keep them empty, so happy days may be here again. Chicago Title got lean between 2009 and 2010, shrinking its workforce by close to 70%. 2012 promises to be a much better year with an increase in liability volume and more sustained growth. In all, Dennis says that the market is a much healthier place than it was 14 months ago. For more info on our sponsor, click here.

MALL ANCHORS OF THE FUTURE

In talking with a select group of retail executives, Trademark Property Co prez Tommy Miller (above, at a Bisnow event in Fort Worth) tells us one of the greatest challenges facing regional malls is the remerchandising of vacant or underutilized anchor spaces. It’s not a new issue—the consolidation of the department store business in the ’80s and ’90s left vacant boxes across the country with many still empty today. But the situation is arguably more acute now given the impact of Internet shopping (accounting for 8% of total retail sales) and changing consumer patterns. Additionally, there is a proliferation of lifestyle and now outlet centers in once safe trade areas, and a challenging operating environment for Sears and other department store chains.

His first tip to retailers: try new things. “If you are not willing to fail and learn, you don’t have a shot.” Walmart is trying smaller stores; Tesco in the UK is using closed stores as fulfillment centers for Internet orders, he says. There will be winners and losers. What is happening in retail is great for the consumer, but it may not be great for business, he says .Factor in the non-existent ground-up development pipeline and that forces retailers to look at regional malls again. “For the foreseeable future, this is where the lion’s share of available space for retailer expansion will come from. And hybrid, unconventional merchandising solutions will become the norm, not the exception,” he says.

The definition of an anchor is also changing, Tommy says. If sales productivity is the right measuring stick, why can’t a restaurant/entertainment cluster or an Apple store generating $ 35M or more in sales (stores average $ 5,600/SF) qualify? The market may be on the precipice of a major paradigm shift in the relationship between anchors, in-line retailers, and mall owners, he says.

Mea culpa: We got the company name wrong in the Parago lease mentioned in our deal sheet on Tuesday. John Hoctor works for Hoctor Commercial Properties. Sorry John. We said two Hail Marys and did 20 pushups to make amends.