01/08/09

• Home

• The Magazine

• Archives

• Webcasts

• Advertising

• Job Board

• New York

• Subscribe

Retail recipe for Aventura

A sculpture and fountain greet shoppers at the Aventura Mall.

High school senior Michelle Meer has world-class shopping just minutes from her home in New York City. But it's when she and her family head to their Miami condo off of Lincoln Road four or five times a year, that the serious shopping happens.

Their destination is inevitably Aventura Mall on Biscayne Boulevard.

And that makes Joe Tagliola, president of Turnberry Associates' retail division, smile. Aventura is home to the mall developer, whose strategy for growth includes several projects nearby, as well as new projects from Las Vegas to Destin, in Florida's Panhandle.

One of the topperforming malls in the country, Aventura Mall has an increasingly upscale mix of tenants spread over nearly 300 stores including Nine West shoes, Betsey Johnson dresses, 7 For All Mankind jeans, Calvin Klein and Armani chains. Not surprisingly, it's the Miami Herald's Hot List choice for "Best Local Shopping Destination."

"In terms of getting the most shopping done, it's definitely Aventura," Meer said. "They have all the stores for teens and department stores too. Plus, it's a very pretty mall."

"We have tons of international travelers coming to Florida, a large contingent of South American shoppers and European shoppers, and with the devaluation of the dollar, it's much cheaper for them to shop. They've had the opportunity to reap the benefits of this perceived discount on goods and services," Tagliola said.

These factors have combined to make Aventura, in particular, and South Florida, in general, a shopper's destination. While average mall sales come in at about $400 per square foot, Aventura exceeds $1,200 per square foot, Tagliola explained.

Turnberry completed a $125 million expansion of Aventura in February, adding a 167,000-square-foot Nordstrom's and a 200,000-square-foot, three-level wing of high-end stores and restaurants.

Turnberry has also received preliminary approval from the Davie Town Council to develop a lifestyle center called the Commons, an open-air mall with hotel, offices, a dozen restaurants, up to three department store anchors and 1.1 million square feet of retail space. The Commons will resemble a Turnberry project just completed in November in another high-profile location — the 1.5 million-square-foot Town Square on Las Vegas Boulevard in Nevada's gambling mecca.

The developer also owns the Destin Commons, a 400,000-square-foot super-regional lifestyle center in Northwest Florida, featuring Bass Pro Shops World Wide Sportsman, 14-screen Rave Motion Pictures, Belk, casual and fine dining and upscale shopping with 70,000 square feet of prime office space. Plans were announced for an additional expansion, slated for a spring 2009 opening. Work is underway on 93,000 square feet of Class A office space and a six-level parking garage.

In all, Turnberry has developed 20 million square feet of retail in its 50-year history.

Despite a slowdown in the housing market, the growth of Miami-Dade continues to outpace the rest of the country at 1.1 percent annually since 2000, and is projected to rise to 1.2 percent through 2012.

Southeast Florida "is poised to be one of the nation's frontrunners" in employment growth over the next five years. According to the Spring Retail Report released just weeks ago by the International Council of Shopping Centers, it ranks fifth among the top 50 MSAs in the number of new jobs added and 12th for overall employment growth.

"The whole general trade area is expanding in a way that is creating a much longer draw," said Tagliola.

Tagliola joined Turnberry 18 months ago after shepherding the Westfield Group through the expansion of Valley Fair Mall in Silicon Valley and the development of Westfield San Francisco Centre.

"In this retail environment, you have to put something on the map that I call relevant. Eight years ago, the average stay at a mall was two hours, and now it's under 50 minutes," Tagliola said. "It's a unique trend happening now." Shoppers have changed the way they buy, and Turnberry is eager to respond to the new demands.

"You have to bring in the goods and services that will actually support this lifestyle," he said. "To make it a destination, you want to include the types of things in the environment that will get you out of the house with your wallet in your back pocket."

John Crossman, president of Orlando-based commercial real estate firm Crossman & Co., said Turnberry is known for having solid fundamentals and for focusing on its core market and core retailers.

"When you're a department store, one of the most important things you want to look at is return on sales. The average is less than 10 percent return on sales, but in a heavy tourist area, it's less than 5 percent," he said. "If you're back in Brazil, you can't take that blouse back. That's huge.

"In the south Florida market, you have all of these things coming together, with excellent demographics in the core market, and then you have to remember that it's a tourist and destination market as well," Crossman said. "People from all over the world travel there for the chic, hip stores."


Miami-Dade retail notes

According to the ICSC report, whose main author is Justin Greider of Staubach, some of the highlights of Miami-Dade retail are as follows:

• The opening of the vertical power center at Midtown Miami
• Whole Foods adding two stores to the market in mixed-use downtown projects
• DDR and Woolbright developing power centers in Southwest Dade

Occupancy, rents higher

In the Miami-Dade market as a whole, there is 21.9 million square feet of retail space, and occupancy rose from 94.9 percent in the first quarter of 2007 to 95 percent in the third quarter. Rental rates, meanwile, rose by 2.2 percent, from $23.79 in the first quarter of last year to $24.30 in the third quarter.

Retail space transactions

The Miami market saw increased activity with several malls changing hands. The total volume of sales was $1.1 billion in 2007, almost double the $617 million posted in 2006. Westland Mall in Hialeah sold for $267 million, and Southland Mall in Miami sold for $145 million at the beginning of 2007.