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DEVELOPMENT NEWS 48 • SHOPPING CENTER BUSINESS • December 2015 RICHMOND, VIRGINIA STARWOOD TO BEGIN $50 MILLION REDEVELOPMENT OF STONY POINT FASHION PARK Chicago-based Starwood Retail Partners is set to begin a $50 million redevelop- ment of Stony Point Fashion Park, a re- tail center located in Richmond. Plans for the redevelopment include enhanced outdoor spaces, comfortable social seat- ing, common areas, open-air courtyards, green spaces, interactive fountains, bocce ball courts, fre pits, a stage for summer performances that will transform into an ice skating rink in winter, new shops and restaurants, improved accessibility for pedestrians and vehicles and experiential entertainment options. Redevelopment is set to begin in summer 2016. P hiladelphia-based Metro Commercial, a full-service inde- pendent retail real estate frm focusing on tenant and land- lord representation, investment sales, property management and development services, has seen several shifts in the retail market as millennials move into the spending forefront. With the majority of new development based in urban markets, retailers are creating smaller, more adaptable and versatile concepts to work in these spaces. "On the landlord side, we're doing a lot of repurposing and repositioning of buildings, and not a lot of new construction," says Tom Londres, president and CEO of Metro Commercial. "Most of the suburban shopping centers that are either under construction or are about to go under construction have been in the pipeline for three or four years. They're really not new deals." Londres attributes the fewer amount of these larger subur- ban centers to a larger demographic shift and an increasingly diffcult entitlement process. "What you're seeing more of in new development is the repurposing of older existing shop- ping centers in the suburbs and new mixed-use developments in the cities." The cities are becoming a breeding ground for development activity as new development falls off in suburban and rural parts of the Northeast. "In the urban markets, you're seeing a lot of new retail developments fueled by traditional suburban retailers that are looking at urban markets as the new frontier," says Londres. "You're seeing the rehabilitation of a lot of these city centers. Young millennials and baby boomers are moving in — a lot of jobs are springing up in the urban environment, so the retailers are chasing their customers, and they're chasing them fercely." Smaller concepts paired with stellar online presence, Lon- dres believes, will keep retailers afoat in years to come. "Re- tailers — and this is a trend across the entire retail sector — are getting their online presence geared up and then combining it with smaller, compressed brick and mortar stores that compli- ment their online business and serve the immediate neighbor- hood in these dense trade areas," says Londres. Target recently announced, for instance, that it is building a smaller, more adaptable format as part of an initiative to get into urban environments and college campus environments. As far as trends in the Philadelphia area, Londres notes that new concepts are making their way into the market. "Philly has seen the frst Century 21 outside New York," says Lon- dres. "You're seeing retailers use their smaller, more versatile formats and you're seeing a lot of small specialty grocers, like Whole Foods, ALDI and Lidl, being very aggressive in urban environments. "Bfresh — Ahold's answer to the smaller express grocery format — is looking at multiple sites around the city of Phil- adelphia and other Northeast cities, ranging from 15,000 to 25,000 square feet," says Londres. Smaller amounts of new development have led to a subse- quent lack of supply in many areas across Pennsylvania. "Sup- ply is becoming limited," says Londres. "The difference in the last 12 months related to availability of real estate is dramatic — it has gone from having the choice between A, B and C locations to where I don't even think you have C at this point." While the lack of supply is a mounting challenge for Lon- dres and his clients, he is solaced in the fact that many of the developments that are occurring are in existing, densely-pop- ulated urban areas. "The safe side of this is that if people are building frivolously, they're not doing it in the middle of no- where," says Londres. "Developers are not banking on 18 to 25 percent residential growth in the next fve years to justify the need for their development. They're going one block off of the traditional retail core in an urban area that already is densifed and has the market at their front door." — Katie Sloan Repositioning and Smaller, Versatile Concepts Dominate in Philadelphia Stony Point Fashion Park in Richmond, Virginia, will undergo a $50 million reinvestment to create new common area spaces.