Real estate forum considers the obstacles facing Fairfield County retail market

The idiosyncrasies and challenges that define Fairfield County’s retail property market were in the spotlight at the recent Second Annual Real Estate Outlook, held at the Shorehaven Golf Club under the sponsorship of the Greater Norwalk Chamber of Commerce, the Westport-Weston Chamber of Commerce and Halloran & Sage LLP.

In opening the forum, Eric D. Bernheim, partner at Halloran & Sage, noted that Fairfield County’s municipalities were placing a greater emphasis on commercial development due to the evaporation of financial aid from the state government. “More and more, towns and cities are being asked to carry the burden,” he said. “With little certainty that state funds will be available, municipalities are looking more and more for new development and property taxes as sources to fund their services.”

A great deal of the forum’s running time was devoted to the SoNo Collection megamall under construction in Norwalk. Doug T. Adams, senior director of development for General Growth Partners (GGP), the property’s developer, assured the audience that the project was on schedule for an October 2019 opening and that the recent $9.2 billion acquisition of GGP’s remaining common stock by Brookfield Property Partners LP will not disrupt operations.

“There has been no change,” Adams stated. “Brookfield has been our largest shareholder for quite some time. They are actively involved with the direction of the company.”

Adams shared the news that GGP would provide $550,000 to fund a new circulator bus system that will provide free connections for Norwalk residents with the SoNo Collection and other local attractions, including the Maritime Aquarium and the Stepping Stones Museum for Children. “We’re going to drive a lot of visitations, and to keep those folks coming back, they need variety,” said Adams.

The circulator buses would also keep a lot of vehicular parking out of the South Norwalk district, Adams added. He remarked that the SoNo Collection will feature 3,000 parking spaces, and he pointed out that the circulator bus and other shifts in vehicular usage contributed to the property’s parking planning. “If we did this five or 10 years, the anchors and the retailers would have required 3,700 to 4,000 spaces,” he added.

The forum’s participants highlighted the impact of fee-based ridesharing services like Uber on local property development. “Uber did not exist in Fairfield County two years ago,” observed R. David Genovese, CEO of Darien-based Baywater Properties, who stated several urban markets including Buffalo, Hartford, Seattle and San Jose rewrote their parking requirements on commercial properties due to the growing move away from self-driving in favor of Uber-style chauffeuring.

Genovese also predicted that Fairfield County’s roads will soon see a large number of automobiles with no one at the steering wheel. “Trust me, driverless cars are coming, and we won’t need that much parking,” he said.

Jessica Curtis, senior vice president at CBRE Inc. in Stamford, told the forum audience that she tries to avoid driving if she is going out for the evening. “I don’t have plans for driving anymore if I can help it,” she said. “In my age group, 35 to 45, all of our friends Uber.”

However, Curtis warned that retail and restaurant developers should not be too eager to completely erase parking spaces from their blueprints.

“Reducing parking is almost worse than saying there is no parking,” she said, citing an example of a hipster-aspirational restaurant in the trendy Midtown section of Atlanta that overemphasized pedestrian and Uber traffic in its planning and failed to calculate an adequate quantity of parking spaces. “It was a complete and utter s**t show because people showed up with their cars and they expected that they could park.”

The Right and Wrong Location

Among other issues raised during the forum were the difficulties that some companies faced when trying to establish a retail presence in the county.

“Finding a fitness space in Fairfield County is, like, impossible,” Curtis said. “If I go to Denver, Colorado, there are 24 Orange Theory Fitness locations in Denver alone, but they found one or two deals in Fairfield County. Finding real estate and ample parking to satisfy the zoning requirements is impossible.”

Curtis also highlighted how restaurants in the suburbs outside major markets around the country have been able to thrive due to municipalities that encouraged business development. “There are really cool and creative things happening in periphery markets that you won’t find here,” she said. “Tenants can’t even get signage in a lot of these (Fairfield County) towns without jumping through a lot of hoops.”

Kim M. Morque, principal and president of Spinnaker Real Estate Partners in Norwalk, complained that many small businesses face daunting problems in dealing with zoning regulations. He recalled a South Norwalk restaurant that was interested in setting up outdoor dining but was not enthusiastic about going through a burdensome permitting review process with the city.

“These are small businesses that occupy 2,000 square feet or less,” Morque said. “I don’t know what their gross sales are, but it might be under $1 million a year. They don’t have the wherewithal to go through a process that is extended over 90 days.”

For Genovese, whose company is spearheading the redevelopment of a 6-acre parcel in Darien along the Boston Post Road, working with the local zoning officials was a two-year process that often felt like the real estate equivalent of traveling through the Wayback Machine.

“The zoning regulations we were working around were from the 1950s,” he recounted. “They were set up to control development. They weren’t even contemplating downtown living in the 1950s. It was an arduous process, but an interesting one.”

It All Happens Here

The forum panelists also discussed the role that commercial property developers can play in enhancing a sense of community spirit. Genovese shared the story of how the instability following the 2008 recession helped bring about a new dynamic in Darien through the introduction of free concerts.

“We started programming in a public space we’re involved with in 2009,” he said. “It was really in desperation because no one was going on vacation. We never heard the term ‘staycation’ before 2008 and 2009, and we were worried that people were going to stop spending and support local retailers. So, we came up with this idea for a concert in downtown Darien at the Gross Street Plaza. It started out slow, with the same 10 people showing up for the bands.”

Fast forward to today and Genovese stated the concert series, along with an outdoor art show and a farmer’s market, has brought a new vibrancy to that section of the town.

“There are people who plan their summers around these concerts,” Genovese said, adding that these events seem to tap into an emotion that has nearly vanished in the Age of Zuckerberg. “We’ve all gotten so consumed by social media and technology, but there is a deep-down longing for the way life used to be, and there is a craving for these communal experiences.”

Over at the SoNo Collection, Adams said that extended common space was part of the project. “We are required to do 60,000 square feet, but we’re doing 85,000 square feet for the common areas,” he said, adding that open common space will be found on each of the mall’s three levels.

And in a nod to the South Norwalk community, Adams guaranteed that the SoNo Collection would enhance the wider area and not trample on the local restaurant scene at the core of the neighborhood’s social environment. “We agreed to 6 percent limit on our food and beverage,” he said. “We typically do double that. And the reason is there are great restaurants that exist here and we want them to thrive.”

Source Article

Leave a Reply

Your email address will not be published. Required fields are marked *