Developer scraps plans for Hanover outlet mall
Recent hotel opening seen as sign that area can thrive on its own
SATURDAY, SEPTEMBER 30, 2017
NEWS 24/7 AT RICHMOND.COM
A long-planned outlet mall along Interstate 95 in Hanover County is not moving forward.
The Outlets at Richmond
FINAL was to be developed by Newport Beach, Calif.-based Craig Realty Group, which operates 15 outlet centers in nine states, according to the company’s website.
The 400,000-square-foot mall was to be located at the northeast corner of Lakeridge Parkway and Lewistown Road, in the Northlake Business Park, off Interstate 95’s exit 89.
“At this time, the developer is no longer pursuing an outlet center in Hanover,” Kay Pangraze, Craig Realty’s local project manager, said in a Friday morning story by Richmond BizSense.
Proposals to develop an outlet mall in Hanover date back almost a decade.
“I had a feeling that it wouldn’t move forward. It was just taking too long to get
started,” said Brian Glass, senior vice president at the Richmond and Norfolk offices of Colliers International, a commercial real estate firm.
“In my opinion, outlet malls have peaked. There are fewer viable retailers, and the merchandise they sell is not always what they sell in their stores,” he said. “Furthermore, online options have increased, so why bother making the trip to an outlet mall, unless you’re on vacation?”
Hanover Supervisor Wayne Hazzard said early Friday that he had not heard that the Outlets would not be developed, but he cited the recent opening of a hotel nearby as a sign that the area can thrive on its own.
“I think the area is continuing to develop without it,” Hazzard said. “We’ve made it this far without them.”
In 2008, Horizon Group Properties LLC announced plans for a mall in the Winding Brook development, but it dropped the idea two years later.
Craig Realty then stepped in as potential developer, buying land in the Northlake Business Park in December 2012.
The mall was to be built on 31.4 acres of the 400-acre business park. The first phase had called for about 273,000 square feet of space for about 35 to 40 outlet stores plus restaurants and specialty food stores. A second phase was supposed to add about 127,000 square feet — about two dozen more stores — and a fivelevel parking deck.
In December 2015, Craig Realty announced that Under Armour, Banana Republic and Gap were onboard with the project. In July 2016, a spokeswoman said the project had signed three more tenants: children’s clothing retailers OshKosh B’gosh and Carter’s, plus restaurant chain Johnny Rockets.
But the retail landscape is shifting, with many retailers beefing up their online presence and scaling back on brick-and-mortar stores. Officials at Gap Inc. said in September that the company would close about 200 underperforming Gap and Banana Republic stores over the next year and focus on e-commerce and its growth brands: Old Navy and Athleta.
A market analysis of the commercial retail real estate sector by Cushman & Wakefield | Thalhimer for the second quarter of 2017 shows an overall vacancy rate of 5.9 percent in the Richmond area, an increase from 5.1 percent during the second quarter of 2016.
“The project has been planned for many years. The current owner is capable, but clearly they were unable to get firm commitments from a sufficient number of retailers to make the project a reality,” said Lee Warfield, president and CEO of Cushman & Wakefield | Thalhimer.
“It’s disappointing since the site had some positive aspects, such as a nearby anchor retailer draw in Bass Pro Shops and substantial traffic counts on I-95.”
Craig Realty, which did not return calls for comment Friday, owns several parcels in the business park. Its plans for the parcels are not known.