Shopping Center Business

MAY 2015

Shopping Center Business is the leading monthly business magazine for the retail real estate industry.

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316 • SHOPPING CENTER BUSINESS • MAY 2015 mall was built several miles north, it began to falter in the late 2000s. After Moon- beam acquired the center, it stabilized the tenancy. The center is anchored by Macy's and Korean retailer Mega Mart. Moonbeam has studied the market and determined that it will add some medical and residential uses to the center. "With Gwinnett Place's adjacency to Interstate 85 and plentiful parking, it makes an ideal use for medical and resi- dential uses," says Maksin. Another ideal use is hospitality, which mixes well with medical and retail. Near Syracuse, New York, the company acquired ShoppingTown Mall. The com- pany plans to redevelop that center in the future. There, the company also would like to add medical users. As at Gwin- nett Place and other properties, there are some restrictive agreements that must be overcome to accomplish that goal. "Challenges excite us," says Maksin. "We are loud and clear about the fact that we do not have an easy set of tasks in front of us with some of these properties that have restrictive agreements in place. We work together with the adjacent prop- erties' landowners and the local officials to overcome existing challenges." One of Moonbeam's most complicated projects involves its redevelopment plans for Century III Mall in Pittsburgh. There, Moonbeam wants to demolish some of the 1.3 million-square-foot center and build a hotel and a residential component there. The center's current anchor tenants include Macy's, JC Penney and Dick's Sporting Goods. The project is cost pro- hibitive without economic support from the community. Moonbeam also plans to bring a hospital to the site, which will bring 1,000 jobs to the area. In addition to these centers, Moonbeam has also acquired the 1 million-square- foot Columbia Place Mall in Columbia, South Carolina, anchored by Sears, Ma- cy's and Burlington Coat Factory; Mar- shall Town Center, a 345,500-square-foot regional mall in Marshall, Iowa, anchored by JC Penney, Younkers and a movie the- ater; Five Point Mall in Marion, Indiana, anchored by JC Penney, Carson's and Roses; and Cortana Mall, a 1.4 million- square-foot super-regional mall in Baton Rouge, Louisiana, anchored by Macy's, Dillard's and Sears. Finally, in Greeley, Colorado, Moon- beam acquired the 517,000-square-foot Greeley Mall. The center is anchored by JC Penney, Sears and Cinemark The- atres. There, Moonbeam has not had to redevelop the mall. Maksin feels that the local residents redeveloped the mall themselves and Moonbeam was the cata- lyst in the process. "The problem with Greeley Mall was the community's perception that it was not safe," he says. "We had to regain shoppers' trust and find out what tenants they wanted." In less than three years, we have almost put this broken mall back together. The center should be about 95 percent occupied by year-end, and the sales, year over year, are up 30 percent on many tenants." By holding focus groups and listening to what the community wanted, Moon- beam turned the results over to its leas- ing team. After in-depth analyses of the optimal tenant mix, Moonbeam is excited to announce a recently signed lease with At Home as an anchor tenant. With At Home, Moonbeam boosted the interest of existing and future tenants. "Every opportunity is different, and ev- ery mall is different," says Maksin. "The key strategy is to make sure you under- stand the demographics and work with the community. Today, you cannot ignore the local residents and the local government. To accomplish all of its development plans, Moonbeam has been hiring more talent from the industry. The company is seeking employees with a strong shop- ping center industry background. Because it acquired so quickly, in 2014, the com- pany focused on building processes, sys- tems and roles to fill its needs. "We acquired a lot of real estate over the past five years," says Pryor. "Our com- pany has grown faster than our infrastruc- ture. Over the last year, we have taken a significant amount of time to redefine the roles we have and see where we need people. Our project pipeline feeds a lot into those needs." The needs of the company have changed, too. Relatively recently, Moon- beam divested itself of a few non-core assets in a series of internal transactions with certain partners, in order to enable Moonbeam to remain independent and not leveraged. The company has also ventured be- yond retail. It has developed a strategic partnership with Radisson Hotels and has re-branded its first hotel property. The company has also acquired a number of residential properties, office buildings and non-mall shopping centers. In Cleveland, Ohio, Moonbeam acquired a less than 40 percent occupied 27 story residential building, Lake Park Tower. In less than 18 months since its acquisition, the build- ing is more than 85 percent occupied. With a joint venture partner, Moonbeam is also developing a seniors housing proj- ect near Cannes, France. While the company plans to acquire more properties in the United States, it is also seeking properties internationally. Moonbeam opened an office in Toronto last year. "We'd like to broaden our inter- national experience," says Maksin. "For now, we are limiting that to Canada and our development in the south of France. We are looking for opportunities in the Benelux — Belgium, Netherlands, Lux- embourg — area, Germany and Australia. We want to take Moonbeam to the next level and become a very well diversified global real estate fund." Maksin, who is originally from Kiev, Ukraine, has networked with a number of hedge funds and foreign investment funds throughout the United States, Europe and Asia. SCB Greeley Mall in Greeley, Colorado. Rendering of the plan for Salem Consumer Square in Dayton, Ohio.

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