Building On
Editor’s Note:Chain Store Age’s 18th annual survey of Fastest-Growing Developers identified the country’s top developers based on square footage opened in newly developed or expanded shopping centers during the preceding calendar year–2006.
With tenants seeking different locations to continue their expansion, and the regional-mall format currently out of favor, the top builders have broadened their repertoire to continue to grow. Developers Diversified Realty has expanded beyond its traditional open-air retail format to include other uses. Mall developers Simon Property Group and General Growth Properties both opened major open-air mixed-use projects.
Expansions and renovations have been and will be critical to the growth of Westfield Group and Kimco Realty, respectively. And all are looking outside the United States for development opportunities, contributing to the globalization of the shopping center industry.
2006 Fastest-Growing Developers| Developers Diversified Realty | Beachwood, Ohio | 6,081,756 sq. ft. |
| Simon Property Group | Indianapolis, Ind. | 3,876,000 sq. ft. |
| Westfield Group | Los Angeles, Calif. | 3,760,750 sq. ft. |
| Kimco Realty Corp. | New Hyde Park, N.Y. | 3,058,598 sq. ft. |
| General Growth Properties | Chicago, Ill. | 2,631,293 sq. ft. |
No. 1: Developers Diversified Realty
This year’s top developer, Developers Diversified Realty, is also the third-fastest-growing acquirer (see page 74). But even as it continues its role in consolidation, the Beachwood, Ohio-based company’s 6.1 million sq. ft. of new space shows it is pursuing a building path.
“Development is critical to our corporate growth,” said Scott Wolstein, CEO.
In a low cap-rate environment, development has become more profitable, he explained.
“We used to build to a 12% return and sell at 9.5%,” Wolstein said. “Now we build at 11% and sell at 5%. That’s almost a 100% return.”
Developers Diversified RealtyNew and Expanded Properties Completed in 2006
| Brookhighland Plaza | Birmingham, Ala. | 55,398 sq. ft. |
| East Side Plaza | Gadsden, Ala. | 64,400 sq. ft. |
| Phoenix Spectrum Mall | Phoenix, Ariz. | 403,571 sq. ft. |
| Buena Park Downtown | Buena Park, Calif. | 84,901 sq. ft. |
| Valley Central Shopping Center | Lancaster, Calif. | 323,109 sq. ft. |
| Crystal River Plaza | Crystal River, Fla. | 24,000 sq. ft. |
| Lakeland Marketplace | Lakeland, Fla. | 77,557 sq. ft. |
| The Shops at Midtown Miami | Miami, Fla. | 633,001 sq. ft. |
| Ocala West | Ocala, Fla. | 53,000 sq. ft. |
| Freeway Junction | Stockbridge, Ga. | 79,232 sq. ft. |
| Quincy Place Mall | Ottumwa, Iowa | 81,922 sq. ft. |
| Deer Park Town Center | Deer Park, Ill. | 13,500 sq. ft. |
| The Shops at Fox River | McHenry, Ill. | 426,078 sq. ft. |
| Outer Loop Plaza | Louisville, Ky. | 6,000 sq. ft. |
| Fairplain Plaza | Benton Harbor, Mich. | 108,747 ft. |
| Chesterfield Marketplace | Chesterfield, Mich. | 338,614 ft. |
| Pine Ridge Square | Gaylord, Mich. | 149,488 sq. ft. |
| Ward Parkway Center | Kansas City, Mo. | 142,731 sq. ft. |
| Crossroads Center | Gulfport, Miss. | 15,000 sq. ft. |
| Beaver Creek Crossings I & II | Apex, N.C. | 629,523 sq. ft. |
| Mooresville Consumer Square | Mooresville, N.C. | 67,101 sq. ft. |
| Freehold Marketplace | Freehold, N.J. | 500,000 sq. ft. |
| Hamilton Marketplace | Hamilton, N.J. | 22,500 sq. ft. |
| Boulevard Consumer Square | Amherst, N.Y. | 5,300 sq. ft. |
| Wal-Mart Plaza | Olean, N.Y. | 76,000 sq. ft. |
| Freedom Plaza | Rome, N.Y. | 28,081 sq. ft. |
| Tri County Mall | Cincinnati, Ohio | 160,000 sq. ft. |
| North Heights Plaza | Huber Heights, Ohio | 45,000 sq. ft. |
| Stow Community Center | Stow, Ohio | 78,288 sq. ft. |
| Mt. Nebo Pointe | Pittsburgh, Pa. | 367,719 sq. ft. |
| Plaza Rio Hondo | Bayamon, Puerto Rico | 109,013 sq. ft. |
| Plaza Del Sol | Bayamon, Puerto Rico | 144,000 sq. ft. |
| Plaza Del Norte | Hatillo, Puerto Rico | 21,000 sq. ft. |
| Plaza Senioral | San Juan, Puerto Rico | 5,982 sq. ft. |
| McKinney Marketplace | McKinney, Texas | 87,757 sq. ft. |
| Westover Marketplace | San Antonio, Texas | 560,220 sq. ft. |
| The Family Center at Fort Union | Fort Union, Utah | 79,023 sq. ft. |
| Shoppers World of Brookfield | Brookfield, Wis. | 15,000 sq. ft. |
| 6,081,756 sq. ft. | ||
But the projects themselves have gotten more complicated. Building larger complexes such as The Shops at Midtown Miami, in Miami, and Beaver Creek Crossings, in Apex, N.C., both of which opened last year, requires more time and resources than when the company focused on community and neighborhood centers.
“It’s more like the mall business,” Wolstein said. “The approvals are far more involved than they used to be. You’re now dealing with the Environmental Protection Agency, with wet-lands.”
Development also is taking place outside the United States, as Developers Diversified has bought a 50% interest in Brazilian developer Sonae Sierra Brazil, which will acquire and build in that country. “What we’ve discovered in South America and Europe is a cross between the U.S. mall and the U.S. community center,” Wolstein observed. “They are typically enclosed, but anchored by hyper-markets, and the equivalent of Best Buy.”
Simon Property GroupNew and Expanded Properties Completed in 2006
| Coconut Point | Estero, Fla. | 1,200,000 sq. ft. |
| Shops at Arbor Walk | Austin, Texas | X
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