Chris Thomas, Childress Klein
One of the more exciting and significant retail developments to debut in Charlotte this year is the Charlotte Premium Outlets development at the I-485/Highway 160 interchange in southwest Charlotte. Tanger Development and Simon Property Group joined forces to deliver this 450,000-square-foot, open-air center, which opened to large crowds in late July at close to 100 percent occupancy. It is anchored by a 30,000-square-foot Saks Off Fifth, and includes a full complement of more upscale and moderate specialty retailers.
Grocers Hungry for Market Share
Grocery store activity has driven much of the new development and redevelopment in the Charlotte area, with Publix opening its first units in North Carolina. Publix premiered its Ballantyne store in the spring of the year and has since opened in other renovated locations it gained through its acquisition of a number of Bi-Lo stores in 2013. Florida-based Stiles Development will deliver a freestanding Publix unit in Charlotte’s booming South End area in 2015.
Nearby, Marsh Properties and Aston Properties have recently announced plans for a new Harris Teeter, which will anchor a 60-acre mixed-use redevelopment owned by Marsh Properties on the South Boulevard corridor. Harris Teeter has replaced smaller in-town stores in Plaza Midwood and Myers Park with new multilevel facilities and has performed renovations to a number of its suburban stores in the market.
Elsewhere in Charlotte, Whole Foods and The Fresh Market are increasing their presence in what is an increasingly competitive grocery landscape. The Fresh Market is under construction with a 25,000-square-foot store to open in spring 2015 at Childress Klein’s Promenade on Providence center on Providence Road near the I-485 interchange in south Charlotte.
On the south side of that interchange at the Providence/Ardrey Kell Road intersection, Childress Klein has teamed with Crosland Southeast to develop Waverly, a 90-acre multiuse project that is slated to open in spring 2016. Whole Foods has announced that it will anchor the 235,000-square-foot retail portion of that project with a 40,000-square-foot store. A 135-room business class hotel and 300,000 square feet of Class A office and medical office space are also planned, complemented by single-family and multifamily residential components.
A 35,000-square-foot Whole Foods store also anchors the newly-redeveloped Northcross Commons at the interchange of I-77 and Sam Furr Road in Huntersville, while The Fresh Market is now serving the northeast Charlotte market with a new unit on Torrence Chapel Road in Cornelius, and a store opening soon in back-filled Food Lion space at Mallard Crossing at Prosperity Church and Mallard Creek roads.
As competitive as the grocery store business is in Charlotte, most industry observers expect Sprouts and A Southern Season to enter the market in the next two to three years, and for Harris Teeter, Publix, Trader Joe’s, Aldi, Walmart and other existing successful operators to continue to work to protect and enhance market share. Quality infill and redevelopment opportunities will be much in demand as this high level of activity continues.
Outdoor, Big-Box Retailers Remain Active
After several years of relative inactivity in big-box development, Charlotte has seen new retailers commit to the market, particularly in the sporting goods and outdoor equipment categories.
Academy Sports + Outdoors has opened freestanding 70,000-square-foot units along the I-85 corridor in Concord (west of Concord Mills) and Kannapolis, while a 54,000-square-foot Gander Mountain store anchors the 150,000-square-foot Shops at RiverGate South, which Childress Klein developed on a 22-acre site at the Highway 49/Highway 160 interchange in Steele Creek. This project includes a 24,000-square-foot HomeGoods store as well as new units for Michael’s, Ulta Beauty, Pier 1 Imports and Versona.
On the northeast side of the market, DDR opened its 150,000-square-foot Belgate Shopping Center adjacent to IKEA at the I-85/City Boulevard interchange earlier this year. Belgate is anchored by a 55,000-square-foot Hobby Lobby along with a 26,000-square-foot Marshalls, PetSmart, Old Navy and other national retailers.
Nebraska-based outdoor retailer Cabela’s has committed to several store locations in the Carolinas, including a 100,000-square-foot unit it is developing on a 20-acre site at the I-77/Carowinds Boulevard interchange on the state line between Charlotte and Fort Mill. This store, which along with a sister unit under development in Garner, will be the industry leader’s first stores serving North Carolina markets and will open in spring 2015.
As retail real estate professionals look ahead to 2015 in Charlotte, there is an expectation of continued strong activity as job growth and new residential development, both suburban and infill, create additional demand for retail space. Rising land values and a changing dynamic in the workplace and residential development thought process will likely bring more pedestrian-friendly, vertical mixed-use proposals forward in areas close in to the center city.
— By Chris Thomas, Partner, Childress Klein Properties. This article originally appeared in the November 2014 issue of Southeast Real Estate Business.