(Arkansas Business - December 18, 2014) Things are taking shape at what was once a wooded area near the intersection of I-30 and I-430 in southwest Little Rock — a site that will soon host Arkansas' first outlet mall.
New England Development purchased the 30-acre tract of land at Gateway Town Center in May for $5.2 million. Site work on the 325,000-SF shopping center began the next month. Now, Michael Barelli, vice president of New England Development of Newton, Massachusetts, says the entire building foundation has been poured, and steel is following quickly behind. CDI Contractors LLC of Little Rock is the construction company on the job.
When it opens in the summer, the Outlets at Little Rock is expected to have about 75 stores — both shops and restaurants — and support about 1,000 jobs. New England Development expects the shopping center to generate $100 million in annual retail sales, and in turn, generate $6.5 million in state sales tax, $1.5 million in city taxes and $1 million in county taxes.
Arkansas Business spoke with Barelli this week for an update on the development. Here's some of that conversation:
Arkansas Business: How is construction different for an outlet mall, compared to a regional mall?
Michael Barelli: It's similar. The fact an outlet isn't an enclosed mall means the staging of the construction is a little different. It means you're building individual buildings, so that makes the pacing different, but in terms of time and how long it takes, it's a similar building process.
AB: Do the demographics of a particular area factor into the size and layout of the outlet mall?
MB: Size-wise, we work hard to make them the right for the size and depth of the market, so in a market like Little Rock, we feel like 325,000-SF of retail that we are delivering is the right size — especially for a center that is the only one in the state and for a great distance, so it will be a destination. This is right in the wheelhouse or sweet-spot of outlet centers around the country. If it's a larger market, you start to see 400,000-SF and above.
AB: What do you see in current retail trends and how it affects Outlets at Little Rock?
MB: Outlet shopping has been very popular, especially, in the past few years. I think people are more cost-conscious and the relative rarity of outlet centers and the kind of deals they offer… we really see these centers becoming destinations and magnets for retail activity. It's not like you can build an outlet center in every part of the country, and there won't be as many outlets as regional malls. They will remain somewhat of a unique product type, but we see them being strong piece of the market.
AB: Palm Beach Outlets was mentioned as barometer for possible tenants at Outlets at Little Rock. Is that still so?
MB: We absolutely still plan to bring the same types of tenants as the Palm Beach center.
AB: Any idea on when announcements could be made on tenants?
MB: It's off in the distance, but we will be open summer 2015, so our tenants typically start announcing — and allowing us to announce their names — a few months before that … There will be a lot of tenant action around that time.
AB: What kind of impact does The Grove have on the outlet mall?
MB: Tommy Hodges' plan includes very dramatic lighting of the elm trees, which is great. It creates a beacon along the highway, that's important, because it marks the place. Another great thing, in terms of synergy, is the plan to deliver a number of hotels and restaurants. Those are all uses that complement the outlet center and allows people to stay an extra day or spend a little more time at our center to shop and dine. In terms of synergy and complimentary uses, The Grove and all that is great for the outlet center.
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