C C ants, entertainment concepts, more restaurants and office space. New -mark Merrill’s Janss Marketplace, for example, is the oldest mall in Thou-sand Oaks, but it only contains 10 traditional retailers, despite boasting 40 storefronts. That’s because a recent renovation has brought new concepts into the 458,000-square-foot commu-nity center. They include Defy indoor trampoline park, Mighty Axe and Cal-ifornia Fish Grill. Aldi now occupies a former Toys “R” Us space, while MB2 Raceway will transform a former Bur -lington Coat Factory into an indoor track for electric go-karts with a bowl -ing alley and sports bar on the second floor. Pieology will also open at Janss Marketplace in 2022, and a hotel is slated for the near future. “Having such significant leasing activity, community engagement and increased traffic at Janss Market -place reinforces the narrative that we have always believed — centers that become part of the community and provided opportunities for people to create lasting memories will succeed no matter the times,” Sigal says. “We continue to see increased traffic at Janss and other centers throughout our portfolio as consumers return to having a sense of community.” Newmark Merrill is expanding Rialto Marketplace in Rialto. It will soon include an additional 120,000 square feet, with Sprouts and Burlington already signed on as tenants. Adapting To The Market Leslie Lundin, co-founder and man-aging partner at Los Angeles-based LBG Real Estate Companies, also be -lieves in the mixed-use approach for many of today’s retail centers…when it makes sense. For Lundin, opportu -nity in today’s market lies with the wants and needs of local consumers, as well as the best uses of that real es -tate. “Opportunities exist to either re-position distressed properties into mixed-use, adaptively reuse well-lo -cated properties where surrounding uses dictate a higher and better use, or to just re-tenant them with different types of tenants and fine-tune centers into a more favorable post-COVID en -vironment,” she says. With this in mind, LBG sold the 1.2-million-square-foot Hilltop Mall in Richmond, California, to Prologis for a reported $117 million this past April. Being a logistics company, one might assume Prologis will turn the entire 77-acre asset into an industrial venture. However, initial reports say this acquisition will allow the firm to enter the mixed-use space, adding res-idential and, of course, logistics uses to the retail property. “We see the post-COVID retail world as an opportunity for commu -nities with outdated regional malls to reclaim and bring new life to some of their best locations,” Lundin adds. LBG’s decision to sell Hilltop — a center it acquired in 2017 — doesn’t mean the firm is pessimistic about the future of brick-and-mortar retail. Quite the opposite. LBG’s belief in re -tail is so strong, it wants to help others jump into the game. “We feel very bullish on retail as -sets,” Lundin clarifies. “Given lin -gering concerns over retail, we have recently rolled out a preferred equity program specifically focused on pro -viding bridge capital up to 90 percent of total project cost. This is designed to take advantage of the overall capi-tal market hesitancy to invest in retail real estate.” When it comes to retail, Lundin sees opportunities for open-air centers. Consumers in idyllic weather states like California have always enjoyed the outdoor shopping environment — a preference that has been reinforced since COVID. Lundin also sees a sig -nificant return to shopping centers as the lockdowns have caused consum -ers to seek experiences outside the home. “We are seeing a swing back to -ward in-person engagement,” she says. “Retail has come roaring back as people realize that in person isn’t a bad thing after all. It’s quite the oppo -site and shopping as a sport is an im-portant part of our entertainment rep-ertoire. Bottom line, trends that were taking root in 2019 are back — with the exception of urban retail, which continues to suffer.” Suffering may also continue for in-door malls like Hilltop, with the pan -demic dealing a death knell to certain assets. Though Lundin remains opti -mistic about certain retail opportuni-ties within California, she does have some concerns as we exit this bizarre period. “I’m concerned that COVID-relat -ed distancing and fear of a connected environment will require major long-term changes to brick-and-mortar retail, which will create widespread functional obsolescence in not just the 16 California Centers Magazine | September/October 2021
California Centers September/October 2021: Page 18
