Mall could mark end of era

As planned open­ing date nears, shop­ping trends move on

The News-Times (Sunday) - - Sunday Business - By Alexan­der Soule

On an­other Fri­day af­ter­noon as traf­fic on In­ter­state 95 crawled by the SoNo Col­lec­tion mall un­der con­struc­tion in South Nor­walk, passers-by were able to get a pro­longed look at the pace the project is pro­ceed­ing against an an­tic­i­pated open­ing for the 2019 hol­i­day season.

Does the mall’s new owner, Brook­field Prop­erty Part­ners, need to pick up the pace to make the dead­line it in­her­ited from GGP? The devel­oper is not say­ing, and city of­fi­cials are not of­fer­ing a win­dow to any in­sights they may have on that front.

Nearly 18 months af­ter GGP be­gan pour­ing the So- No Col­lec­tion’s foun­da­tion and with less than a year to go be­fore the devel­oper’s stated plans to open the mall in late Oc­to­ber 2019, ex­posed gird­ers still dom­i­nate most of the SoNo Col­lec­tion site in full view of I-95 in South Nor­walk.

In early Novem­ber, Brook­field ex­ec­u­tives shared their views of GGP’s mall port­fo­lio af­ter ac­quir­ing GGP a few months be­fore in a $15 bil­lion trans­ac­tion, with­out ad­dress­ing specif­i­cally the SoNo Col­lec­tion’s progress. On its new leas­ing page for the SoNo Col­lec­tion, Brook­field cites the fall of 2019 for a planned open­ing, with­out stat­ing how late in the season that could oc­cur.

In its quar­terly re­port with the Se­cu­ri­ties & Ex­change Com­mis­sion, Brook­field Prop­erty lists an ex­pected to­tal SoNo Col­lec­tion de­vel­op­ment cost of $475 mil­lion, $50 mil­lion be­low GGP’s own es­ti­mate only three months ear­lier, with Brook­field not not­ing whether the lower price tag is the re­sult of con­struc­tion sav­ings, an­other in­vestor pick­ing up a por­tion of the project or an­other

rea­son.

GGP had ac­tively sought a co-in­vestor for the SoNo Col­lec­tion, with Brook­field CEO Brian Kingston say­ing ear­lier this month that is the goal for a sub-seg­ment of the GGP retail prop­er­ties it in­her­ited in the ac­qui­si­tion. Brook­field re­ported $52 mil­lion in new SoNo Col­lec­tion ex­penses be­tween July and Septem­ber in its fil­ing with the SEC, bring­ing to $258 mil­lion it has spent on the project to date in­clud­ing GGP con­tri­bu­tions.

In the same fil­ing, Brook­field has now pushed back to 2022 an ear­lier pro­jec­tion by GGP of 2020 as a “sta­bi­lized year” for the SoNo Col­lec­tion to reach its retail ten­ancy ex­pec­ta­tions, with GGP hav­ing main­tained oc­cu­pancy lev­els of nearly 95 per­cent at its malls na­tion­ally.

Re­tail­ers fi­nally mak­ing de­ci­sions

Some retail an­a­lysts have pre­dicted the SoNo Col­lec­tion could rep­re­sent the last newly con­structed, en­closed mall in the coun­try for the fore­see­able fu­ture, as Ama­zon con­tin­ues to lure shop­pers and as newer retail de­vel­op­ments em­pha­size out­door set­tings.

Af­ter GGP re­served its two ma­jor an­chor pads for Bloom­ing­dale’s and Nord­strom depart­ment stores, its CEO went on the record with the wish, in hind­sight, of hav­ing left one pad open to ac­com­mo­date a non-store ten­ant of some type. Kingston made clear last month that is his vi­sion as well for many of the GGP prop­er­ties Brook­field has taken on, with­out singling out the SoNo Col­lec­tion.

“The on­go­ing trend of non­tra­di­tional mall ten­ants tak­ing space in our prop­er­ties has not slowed,” Kingston said in Novem­ber. “We con­tinue to re­po­si­tion valu­able space that was once oc­cu­pied by depart­ment stores, (and) view this space as the most com­pelling op­por­tu­nity to rein­vest in our prop­er­ties by re­plac­ing those stores with new and ex­cit­ing uses that com­ple­ment the in-line retail mall com­po­nent. Th­ese in­clude ... restau­rants, en­ter­tain­ment venues, res­i­den­tial projects, flex­i­ble work spa­ces and ho­tels.”

On a nor­mal time­line, it can take six months to build a fully func­tional restau­rant space and line up approvals in a mall set­ting, ac­cord­ing to Jes­sica Cur­tis, a retail and restau­rant leas­ing ex­pert in the Stam­ford of­fice of CBRE, adding that it is not un­usual for ex­pected com­ple­tion dates to shift on con­struc­tion delays. With restau­rant con­struc­tion able to com­mence only when the sur­round­ing in­te­rior has been com­pleted, that would mean Brook­field would want to have those in­te­rior spa­ces largely in place by April or May.

Cur­tis said her clien­tele in­cludes no short­age of up­scale re­tail­ers who have added the SoNo Col­lec­tion as a pos­si­ble des­ti­na­tion in south­west­ern Con­necti­cut along­side Green­wich and West­port — but with un­cer­tain­ties still in play re­gard­ing the over­all mix of ten­ants that might help them de­cide, and the on­go­ing con­struc­tion.

For those that choose the mall, it will take ad­di­tional weeks to fit out their store­fronts, stock mer­chan­dise si­mul­ta­ne­ously along­side dozens of other re­tail­ers, and train staff on site in ad­vance of grand open­ings.

The open­ings will come — the only ques­tion is when.

“When GGP an­nounced the SoNo Col­lec­tion, ... a lot of re­tail­ers hit pause and said, “OK — we don’t know where we’re go­ing to go be­cause the mall hasn’t shaped up enough,” Cur­tis said. “Fast for­ward to this year and even the past six months, we’ve seen re­tail­ers fi­nally mak­ing de­ci­sions.”

Alexan­der Soule / Hearst Con­necti­cut Me­dia

The western fa­cade of the SoNo Col­lec­tion mall un­der con­struc­tion in South Nor­walk.

Hearst Con­necti­cut Me­dia file photo

Nor­walk Mayor Harry Rilling and GGP man­ager Doug Adams in March 2016 with an early model of the SoNo Col­lec­tion mall.

Hearst Con­necti­cut Me­dia file pho­tos

Foun­da­tion work pro­ceeds in Au­gust 2017 at the site of the SoNo Col­lec­tion mall in South Nor­walk.

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