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Pasco mall developers ask: Downturn? What downturn?

Wade Jones, left, and Eric Ransdell level a block engraved “Watch For Cars” on Wednesday at the Shops at Wiregrass.

BRENDAN FITTERER | Times

Wade Jones, left, and Eric Ransdell level a block engraved “Watch For Cars” on Wednesday at the Shops at Wiregrass.

WESLEY CHAPEL — The Tampa Bay market is getting a reputation for star-crossed mall openings.

International Plaza opened as a hurricane threatened, just three days after the 2001 terrorist attacks brought retail spending to a halt.

At 10 a.m. today the $156-million Shops at Wiregrass opens at the epicenter of the local homebuilding collapse and the worst retailing climate in decades.

"Economies go up and down all the time, so we build for the long term," said Jim Richardson, East Coast retail development boss for Forest City Enterprises Corp., which built Wiregrass in a joint venture with Goodman Co. of West Palm Beach. "But if we tap into the pent up demand we saw here last weekend, this project will turn out wonderfully."

Even as shoppers holster their credit cards, Forest City:

•Leased a robust 83 percent of the space.

•Snagged a three-year, fixed-rate construction loan before the credit crunch, which provides breathing room until it needs permanent financing.

•Herded cars through packed parking lots when Dillard's and Macy's opened last weekend.

This is no traditional enclosed mall. It's the area's first mall-sized, open-air Main Street center that has become the preferred, less expensive alternative for developers.

To hedge risk, Wiregrass is two-thirds the size of the bay area's five dominant malls. But its opening confirms Pasco County's long-term plan to parlay vast ranchlands between state roads 54 and 56 astride Interstate 75 into a bona fide hub of commercial development.

"This makes it clear Wesley Chapel will be a commercial hub right up there with Tyrone and Westshore," said Lee Arnold, chief executive of Clearwater-based Colliers' Arnold, which has developed half of its 4,500 permitted residential units in Wesley Chapel Lakes, a sprawling one-time ranch a few miles east.

The Shops at Wiregrass was built to double as a downtown for a 5,000-acre residential community with 16,000 homes, condos and apartments. The project is laid out in a nostalgia-laden crescent like a Main Street lined with parking meters and a town square. Parking garages shorten the walk and protect against the elements. Forest City bought mature trees to make the place look like it has been there for a decade.

Most of the store deals were cut almost three years ago near the apex of the housing boom. The disintegrating economy prompted six to back out this year, but there are handshake deals to replace them.

"Retailers saw Wiregrass as a huge void in the marketplace at least 10 miles from their nearest location," said Keith Brandt, Forest City senior vice president of leasing. "That's rare these days."

Among the initial 71 stores, Wiregrass landed some surprises: a two-story Barnes & Noble Bookstore, a Forever XXI (the bigger, flashier version of Forever 21 seen locally only at International Plaza in Tampa) and signature restaurants new to the market: Cantina Laredo, Cosi, 365 Cafe Italiano, Yamato Japanese Steakhouse and the Brass Tap, a locally owned microbrew pub. Pottery Barn and Williams-Sonoma signed. Blame the paucity of other home decor stores on the housing slump.

The banks and retailers believed that Wesley Chapel was big enough to support the project even before home-building fell off a cliff. Currently 350,000 people live within 10 miles, 50,000 more than projected for 2009.

They are young, affluent families. The average age is 38, and 41 percent are college graduates. Half of households earn $70,000 or more, well above the regional average. And that doesn't count shoppers that Wiregrass siphons off I-75 from Hernando County.

Cleveland-based Forest City, which boasts a $10-billion real estate portfolio, has one of the nation's most ambitious commercial development pipelines. Wiregrass is the company's fifth similar project to open this year. It is also building the controversial $4-billion Atlantic Yards project in Brooklyn, N.Y.

In Pasco, a changed economy and permitting played roles in the three-way race to develop the area. The government had handed out as much retail development rights as today's congested Brandon or Tyrone areas, touching off a fierce race to land tenants poised to exploit a virgin market.

First out of the ground was the Grove at Wesley Chapel, a 950,000-square-foot center two-thirds full with Cobb Theaters, restaurants and big-box stores like Best Buy and Bed, Bath and Beyond.

Wiregrass snared three full-line department stores — Macy's, Dillard's and JCPenney — and the flock of specialty stores that follows them into malls.

That left Cypress Creek Town Center, west of Wiregrass, with restaurants, an AMC theater and big box chains like Kohl's and SuperTarget. What was to be a 2.6-millon-square-foot center shrunk to 1-million and may open smaller. Since construction was halted last spring, the project wallows in troubles. A permit to dig up 54 acres of protected wetlands was suspended. The Sierra Club sued to halt reinstatement. A contractor sued developer Richard E. Jacobs Group for $1.6-million in unpaid bills. A weak retail climate just cost the project Linens 'n Things and Circuit City.

The project was once slated to open in 2007, but Jacobs now won't say when.

"But we are committed to finish the project," said spokeswoman Deanne Roberts.

Mark Albright can be reached at albright@sptimes.com or 727-893-8252.

Pasco mall developers ask: Downturn? What downturn? 10/29/08 [Last modified: Sunday, November 2, 2008 3:05pm]
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