Tuesday, August 9, 2011

AZ Central – Scottsdale Quarter – through the CEO’s eyes « Scottsdale Arizona Real Estate Blog

Boutiques, upscale eateries and large-merchandise outlets continue trickling in at Scottsdale Quarter, the $270 million shopping center

developed by Ohio-based Glimcher Realty Trust on Scottsdale Road near Greenway Parkway. At the same time, the project has generated ongoing legal disputes, liens for unpaid construction work and tenant evictions since it opened in early 2009.

In an interview with The Arizona Republic, CEO Michael P. Glimcher discussed industry challenges during the recession, the project’s

success so far and his vision for its future.

Question: Compared to your other 26 properties nationwide, how does the Scottsdale Quarter compare?

Answer: It’s a really special project for us in that it’smixed-use, it’s open air, it sits in the fifth biggest city in America. For a

lot of reasons it’s in our top quartile of assets. . . . We think it’s not only unique compared to our other centers, we think it’s unique compared to everything else out there. … It feels urban and has a lot of energy. It’s modern, but it’s warm. It’s a special, special place for this company and we’re really proud of it.

Q: How would you rate its success as a new project so far?

A: The Quarter is unbelievably successful beyond our expectations, and considering the environment we leased it into and the

environment we put it into, it’s really outstanding to think how many are doing exceptionally well.

Q: Why have you evicted some tenants during a time of high retail-vacancy rates, especially in metro Phoenix?

A: There will be people who don’t succeed. There’s just not a 100 percent hit rate in retail. It’s just the reality of it. . . . Even in

the best of times, retailers turn over.

Q: Are there still plans to develop a third and final phase on the east side of the property?

A: We had a partner in Wolff (The Wolff Company) and we ended up buying 100 percent of the project. They had initially intended to do

condos and a hotel. We’re now exploring a whole new plan. There’s been a lot of interest for for-rent residential, which we would probably work on with another company, not just ourselves. . . . We also think there’s an opportunity to add another 100,000 to 200,000 square feet of retail on that Phase 3 site, and we’ve been talking to some high-quality retailers who are interested in it.

Q: Are you still considering a hotel component?

A: We’re also looking at a hotel, maybe a 200-room boutique/city hotel. There’s a lot of great resort properties in the area, but

there’s not really a city-type hotel and we think that’d be a nice addition.

Q: When will the third phase likely be open?

A: 2013 opening for Phase 3.

Q: Why did The Wolff Company back out of the joint venture in September?

A: I really don’t know. It’s really something you’d have to ask them. … They had other things they wanted to do, and it was another

opportunity for us to really rethink Phase 3. . . . When the for-sale residential market wasn’t there, which was really what was driving their

interest in it, and maybe they thought it was better we do something different with it. But we can’t really speak for them. . . . It was a joint venture. Sometimes they last forever, sometimes they last for a year. It just depends on what the goals and objectives are of each partner, and that changes over time.

by Kristena Hansen The Arizona Republic Aug. 4, 2011 01:01 PM

AZ Central – Scottsdale Quarter – through the CEO’s eyes « Scottsdale Arizona Real Estate Blog

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