Retail throughout the country is going through growing pains. Redevelopment is turning old, tired malls into retail destinations. Two West Coast investors are finding ways to bring customers back to malls and shopping centers by reinventing the shopping experience.
Pacific Retail Capital Partners focuses on value-add core plus space and prefers opportunities that lack active management, but the retail property has a clear reason to exist, according to Pacific Retail Capital Partners managing partner Steve Plenge. The firm, which manages about $1B worth of assets, brings active management and focuses capital to improve sales and net operating income over a general period.
When it redevelops a property, PRCP brings in new design and entertainment concepts. At Shops at South Town in Salt Lake City, Plenge said the firm is adding entertainment concepts and a theater. Digital screens throughout the mall provide live feeds, art and additional interactive content. An interactive kid’s wall (above) has been particularly popular.
“We try to do something that is a bit more cutting-edge on the retail end,” Plenge said. “Since we’re a smaller firm, we have the ability to be more focused on the headwinds in the retail world and continue the evolution of retail.”
Plenge said the firm typically prefers Class-B to Class-B+ malls lacking attention where the firm can bring relevant design to the mall. PRCP typically redoes the restrooms, adds family restrooms and transforms food courts into curated food halls, often with local food operators. Its Paseo Nuevo mall has hosted events, such as College Night Out and a fall fashion show.
Other options PRCP has considered include adding multifamily, hotels and medical offices to its redeveloped properties. A lot of REITs focus on national retailers, but PRCP prefers bringing in local retailers and food services to create more of an eclectic group.
PRCP holds assets nationwide, including New York, Chicago, Jackson, Miss., New Orleans, Salt Lake City, San Jose and Santa Barbara.
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