American Dream Ushers in Retail, Entertainment Growth in Northern New Jersey
Across the Hudson River, retailers and residents in Northern New Jersey benefit from lower rents and lower sales prices relative to Manhattan. In addition, mass transit lines that cross the river enable mixed-use destinations that offer dining and entertainment experiences, including the new American Dream project, to function as day-trip destinations for residents and tourists.
“Northern New Jersey is still a strong tenant’s market,” says John Azarian, co-founder and CEO of New Jersey-based brokerage firm The Azarian Group. “Tenants are commanding and receiving substantial build-out and tenant improvement accommodations, with the strongest retail tenants being in the service, fitness and dining industries.”
The retail vacancy rate in Northern New Jersey in the third quarter stood at 4.2 percent, unchanged from a year ago. During the same period, the asking rent rose 2.1 percent to $26.47 per square foot, according to Marcus & Millichap. The firm projects that 3.1 million square feet of new retail space will be delivered in Northern New Jersey by the end of 2019. Most of that new product will be housed at the American Dream entertainment and retail development in East Rutherford.
In late October, Triple Five Group opened the first phase of its approximately $5 billion American Dream entertainment and shopping destination within the Meadowlands Sports Complex, which also houses the MetLife Stadium, home of the New York Giants and the New York Jets.
Originally proposed by The Mills Corp. in 2003, the 3 million-square-foot retail project navigated a series of funding and construction snags at various stages of development until Triple Five Group took over the project in 2013.
American Dream is the Northeast’s answer to the Midwest’s Mall of America, which Triple Five also developed. The retail destination boasts an ambitious roster of entertainment attractions, including a Nickelodeon Universe theme park with 35 rides and roller coasters, indoor DreamWorks Water Park, indoor ski and snow park, Sea Life Aquarium, Lego Discovery Center and an NHL-size ice rink.
Approximately 450 retailers will open at American Dream by spring 2020, including 100 luxury apparel and accessory retailers in a two-floor shopping zone called The Collections.
“We have curated and thoughtfully designed a blend of new-to-market retail, entertainment and culinary experiences sure to please both local customers and tourists alike,” says Don Ghermezian, CEO of American Dream. “Retail cannot exist in today’s environment without entertainment — my father knew this back in the ’80s when he built West Edmonton Mall [in Alberta, Canada.] This idea culminates at American Dream with 300-plus retailers and world-class entertainment destinations.”
Planned dining options at American Dream include a Hard Rock Cafe, a kosher food court and a 38,000-square-foot Munchies Food Hall, which will feature 18 vendors curated by the Munchies food and culture division of New York-based Vice Media. Vice will continue to partner with American Dream to curate future dining tenants and plans to include space to film Munchies content.
Ghermezian and the rest of the American Dream team actively avoid comparisons with traditional shopping malls, preferring to market the project as primarily an entertainment destination with a sizable shopping component.
“Our entertainment and dining offerings make up 55 percent of the property,” he explains. “Along with impeccable service and convenience, this creates an atmosphere for shopping to really shine, as well as guaranteed traffic for our tenants through the entertainment components.”
— By Alex Patton. This article first appeared in the November-December issue of Northeast Real Estate Business magazine.