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Shopping Centers Today -> July 2003
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HOUSTON’S GALLERIA COMPLETES MAJOR RENOVATION
BY DONNA MITCHELL
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| The $144 million addition expands the Galleria to 2.4 million square feet. |
The Galleria, the renowned mixed-use center in Houston, has received a renovation and expansion worthy of its fame.
The expansion, completed in March, and the renovation, unveiled in December, took about five years. The $144 million project has added 700,000 square feet of gross leasable area to the shopping center portion, bringing the Galleria’s total retail GLA to 2.4 million square feet.
“For the immediate future, we’ve made it all that it can be,” said Art Spellmeyer, executive vice president of development at Simon Property Group, which manages and partially owns the Galleria.
Houston developer Gerald Hines opened the Galleria in 1970. The property quickly won attention for combining several urban uses in a vertical setting. At its base are an ice-skating rink and a two-level shopping center. The signature barrel-vaulted skylight ceiling over the rink is modeled after the Galleria Vittorio Emanuele II, Milan, Italy, built in 1877. Attached are an office tower, two Westin hotels and the University Club, a private health and dining facility.
The retail portion comprises three components. Galleria I, as Simon officials call the original portion that Hines built, features 600,000 square feet of retail space. The first expansion, called Galleria II and completed in 1986, added 360,000 square feet of retail space on two levels. Bathed in the natural light provided by another arched skylight, Galleria II also features a 3,000-square-foot garden.
This latest expansion was begun when the Galleria was still owned by HG Shopping Centers, the Delaware-based limited partnership of Urban Retail Properties and Walton Street Capital. Simon bought a 31.5 percent interest in the Galleria in May 2002 and now co-owns it with Walton Street and the California Public Employees’ Retirement System.
The expansion had to equal the grandeur of the center’s high, sunlight-soaked ceilings and massive interior space, says Rick Casey of Cooper Carry & Associates, the Atlanta-based architectural firm in charge of the work. Casey was project designer for both expansions.
A portion of the renovation focused on the rink’s “glass” ceiling, which had in fact been replaced with acrylic because the original glass heated the rink’s surface and made it puddle.
“It was pretty messy when people would fall,” said Casey. But the acrylic got discolored over time and began to look pretty messy too. Casey’s team has replaced the acrylic with a type of glass that lets in light but will not melt the ice.
“The skylight looks tremendously better, and so does the quality of light,” said Casey. “It does not come through brown acrylic anymore, so it doesn’t look dingy.”
Tastes have changed, too. Owners once believed that carpeting made a mall look upmarket, but it does not have the same cachet today. The team removed the carpeting and installed colorful marble quarried from around the world — the gold marble came from China, the gray originated in Tunisia, and the rest came from Greece, India, Italy, Portugal and Turkey.
The original handrails, supported by vertical pickets, were blocking the view of the storefronts, so they were replaced with glass handrails. The architects also put in brighter, more elegant-looking light fixtures throughout.
A year after the renovation got under way, the construction team started the expansion. The new wing, located on the project’s south side, added more than 50 shops to the Galleria, some of them housed inside a 125-foot-long, 200-foot-wide skywalk that spans West Alabama Avenue. The skywalk, whose shops include Armani, jewelry retailer Benbridge and Godiva, doubles as a lobby area for the neighboring Galleria Westin.
Houston’s first Nordstrom, at 217,000 square feet, and a flagship Foley’s, at 250,000 square feet, anchor the new wing; underneath there is a two-level parking garage.
Simon leased space to such in-line tenants as Bebesport, a new Bebe concept that sells trendy athletic clothes and accessories; Club Monaco; a Crane & Co. luxury paper-goods store; and Max Studio. At press time these stores were nowhere else in Houston.
Said Danna Diamond, a senior leasing representative at Simon, “We had two goals: to get stores that were never in Houston before and stores not in the Galleria.”
The first level contains retail geared toward mature, conservative shoppers, including Inner Self, a lingerie retailer aimed at a slightly older shopper, J. Jill and Talbots. The edgier, more contemporary fashions are available in the stores on the second level: Lucky Brand Jeans, Soho and Urban Outfitters.
Casey points with pleasure to the interior’s graceful “C-curve,” which lets shoppers see all the stores in the concourse. Despite the difficulty of laying it out, he said, “that was a lot of fun [to design].”
Unifying the existing center and the new wing was no simple matter of matching glass railings and light fixtures, but rather a major feat of engineering. To make room for the expansion, Hidalgo Street, one of the thoroughfares surrounding the project, was shifted 275 feet to the east. That alone cost $1 million. Engineers also built a cooling plant underneath the expansion to cool water for the air-conditioning systems.
Furthermore, one floor in the Galleria Westin had to be demolished to accommodate the skywalk.
Simon declined to comment on how the project would pay off in sales. But in a March filing with the Securities and Exchange Commission, the company said it expects a 10 percent rate of return on investment.
The changes seem to agree with both the center and its neighbors. “For the shoppers, especially those who frequent the Galleria, there is a new level of excitement,” said Curtis Henderson, a Houston-based vice president of retail brokerage at CB Richard Ellis. (The firm leases office space in one of the property’s towers.)
An added benefit, says Henderson, is that the updated Galleria, part of a miniature development boom in the city, will complement luxury lofts and apartments being built nearby.
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