PRINT THIS STORY:

CHANGE TEXT SIZE:

A TOUCH OF CLASS

Alabama lifestyle center brings sophisticated shopping to upscale locals

BY DEBRA HAZEL

Even Hurricane Ivan couldn’t stop the completion of Eastern Shore Centre, a new lifestyle project in Spanish Fort, Ala., near Mobile.

The developer, Eastern Shore Centre LLC, broke ground on the $72 million, 570,000-square-foot center in June 2003, and notorious Ivan came calling in mid-September, just a couple of months before the center’s scheduled grand opening. The eye of the category 4 storm passed within 20 miles of the property, but only damaged a couple of parapets, battered some landscaping and stripped the bark of the oak trees.

“It could have been way worse,” said Everett Hatcher, a principal at CMH Architects, the Birmingham, Ala.-based firm Eastern Shore Centre LLC hired to design the project, which features a racetrack-style, oval layout seen more often in regional malls than in open-air lifestyle centers. The escape from Ivan’s full wrath was a stroke of good luck for the development team, which had been toiling on the project for about seven years.

Charles Trotter, president of The Trotman Co., a Montgomery, Ala.-based development firm, first spotted the 254-acre site in the late 1990s. It is located at the intersection of Interstate 10 and Malbis Parkway, only 25 miles from the Gulf of Mexico. He and his brother Woody, a senior vice president at the company, brought in Phillip E. Stephens, president of Atlanta-based Stephens Property Group. Phillips, in turn, invited the Dallas-based Herring Group and Mobile-based Foshee Realty to join the development team, which took the name Eastern Shore Centre LLP.

A rival developer had optioned a site across the interstate, so the team had its work cut out for it in the preleasing. To make matters worse, the Eastern Shore team had to deal with two municipalities, Spanish Fort and nearby Daphne, Ala., that were competing over the land. Ultimately, the entire site was annexed by Spanish Fort, which contributed more than $10 million in tax increment financing.

One problem the developers didn’t have to worry about was convincing retailers of the market’s potential. Located in Baldwin County between the larger metro areas of Mobile and Pensacola, Fla., Spanish Fort is a small town with a nearby Tanger Outlet Center but few other specialty retail choices. The developers found that though Baldwin was the fastest-growing county in Alabama, it lacked concentrated traditional retail because of the size of the market — about 5,500 people.

But the Eastern Shore Centre’s market is actually larger than just the population of Spanish Fort. Its primary trade area includes not only all of Baldwin County but also the western section of Escambia County, Ala. A total population of 165,917 (in 2002) is projected to grow a bit, to 183,158 by 2007.

And those residents are affluent: The average yearly household income within Spanish Fort is $75,145 a year; nearby Daphne boasts an average household income of $77,173.

Tourists and part-time residents are also important to the trade area, which boasts about 4 million visitors annually. The project’s proximity to the Gulf Coast’s sugar-white sands makes it a stopping point along the beach route. And there is beach housing steadily going up along Baldwin County’s 32 miles of Gulf frontage.

The Herring Group’s owner, M.G. (Buddy) Herring Jr., set about recruiting anchor tenants for the center and landed Dillard’s. But the department store chain had expansion plans that meant the project would have to wait until Dillard’s was ready to build a new store — in 2004. (The chain closed one of its stores about four miles away).

The development team originally wanted to build a traditional regional mall. But Dillard’s lobbied for an open-air layout. A second anchor, Belk, signed on and will open next month. Woody Trotman handled the leasing of the project’s specialty tenant space. At its Nov. 17 opening, Eastern Shore was 80 percent leased to such tenants as Barnes & Noble, Build-A-Bear Workshop, Hollister and Pottery Barn.

Many tenants are new market entries that have stirred up regional interest in the project. “A lot of the stores we did are not in Mobile or in Pensacola,” Herring said. “That really increases our trade area.”

Rents are at the top of the market average, notes Marietta M. Urquhart, a sales associate at NAI/Heggeman Realty Co., a Mobile-based brokerage. According to NAI’s 2004 Global Market Report, rents for subregional centers ranged from $15 per square foot to $25 per square foot in the market.

Then there was determining the look. “We worried about what the right architecture was for Spanish Fort,” given its history, Hatcher said. The area did indeed have a Spanish fort and also saw action during the Civil War.

CMH ultimately decided on a Mediterranean theme, using stucco and textured brick. “The whole project revolves around a central green space, with two restaurants and a fountain,” Hatcher said. A gazebo provides a focal point too. The design also allows for street-front parking at a much higher ratio than on the project’s exterior: The overall parking ratio is 4.5-to-1; the internal parking is 2-to-1.

About 72 percent of Eastern Shore has actually opened its doors, and sales thus far have been “excellent,” Herring says, with a number of tenants seeing record revenues. The developers anticipate sales per square foot of between $350 and $375.

And the shoppers have been relatively young. “We saw a lot of strollers,” Herring said.

The development team’s plans include opening Eastern Shore Plaza, a 250,000-square-foot power center, in August, says Herring. And other developers have proposed projects for the area too, including the Spanish Fort Town Center, with 1.1 million square feet of department stores, restaurants and a hotel to be built by Cypress Equities, the development arm of Staubach Retail Services, Dallas.

It just goes to show how even a small town can attract big-name lifestyle retailers. “You have to have good demographics,” Herring said. “And you need landscaping and a good tenant mix.”