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January 2009 Minnesota Shopping Center Association Vol 23. No 1 In this Issue Elk Ridge Center ----- SNAPSHOT 1 Newsletter -------- COMMITTEE CHAT 4 STARRSM Awards -- PROGRAM RECAP 5 Pounds/Carlson --- MEMBER PROFILES 9 Twice The Gift ------- RISING STAR 9 The Beast ---- HOT SPOTS / COLD SNAPS 11 Connection Feature by Ross Dahlin, Itasca Funding Group, Inc. The Evolution of Community Shopping Centers in the Twin Cities is now upon us, and the outlook has and his partners have never appeared more dismal for the developed their own retail 2009shopping center industry. Rather than a centers as long-term story on the gloomy economic outlook, perhaps we can all investments. take comfort in reminiscing on some history of the industry. Bruce shared his ICSC Home to Southdale and the Mall of America, the Twin Cities directory from 1967/1968 has an important place in the history of shopping center (MSCA did not exist until 1988). industry. Many of the developers, architects, and retailers The Minnesota section based in Minnesota were visionaries of their time and remain contained 30 member significant today. companies. The names listed on the sidebar, next page, could each have their own feature article, but the point of I had the opportunity to meet with Bruce Peterson, Principal displaying this list is to highlight the growth of the industry of SDC Equity Partners, for his knowledge regarding this and conjure up memories. topic. Bruce has been in the shopping center industry for 50 years and worked for a number of developers in the 60s and Beyond MOA and the “Dales,” the history and evolution of 70s on projects throughout the Upper Midwest. He founded smaller “community” shopping centers is a story that often Security Development Corporation in 1977 as a goes untold. Every Minnesotan knows that Southdale was development company for select clients. Since 1986, he the nation’s first indoor mall. Opened in 1956, it set the bar Snapshot Location: 197th Avenue and Highway 169, Elk River Elk Ridge Center Month/Year Opened: October 2005 Owner: Hempel Center Manager: Dave Syers, Hempel Leasing Agent: Brent Jacobson and Ben Krsnak, Hempel (763) 383-1100 Anchor Tenants: Aldi Foods, US Bank, Pearle Vision, New Horizon Child Care Market Area Served: Elk River, Ostego Additional Facts/Narrative: Elk Ridge Center serves the community of Elk River by offering Aldi Foods, US Bank, Pearle Vision, New Horizons Daycare, and 22,000 sf of future small shop space. The site offers full visibility to 43,000 cars from Highway 169 daily. msca-online.com 1 MSCA Connection January 09 Community Center Evolution - continued Looking back ... for the next 25 years of retail development. The community treated developers of these The Edina mall was wildly popular and centers very well. Land was cheap and ICSC quickly copied across the nation, even in readily available, regulations were few, and Directory warm climates. Post-war the burgeoning bedroom suburbs now had a communities required 1967/1968 gathering place, a place retail space. Unlike today, Minnesota Section where the kids could see “...PARKING the acres of parking lots Santa and adults attend a STANDARDS WERE surrounding shopping Apache Realty Corp theatrical event. Every CREATED TO centers were not seen as William H. Burns suburban and sizable blight but as a sign of Bor-Son Building outstate community ACCOMMODATE vibrancy. Many cities J.E. Boran looked with envy to what FOUR DAYS PER required six parking spaces Crossroad Center, Inc. Edina possessed and per 1,000 sf. According to G.P. Schoenfelder YEAR: BLACK Crystal Realty wanted their own Mr. Peterson, “parking FRIDAY AND THE Max Saliteman Southdale. standards were created to The Dayton Company THREE SATURDAYS accommodate four days Of course, the Twin Cities Robert J. Crabb per year: Black Friday and Dayton Development Co. could only support so BEFORE the three Saturdays before William Crear, Jr. many regional malls. CHRISTMAS.” Christmas.” Gerald J. Oberuc Smaller “community” malls James Douglas were constructed in many As the Twin Cities suburbs Wallace C. Dayton James McClure suburbs including: continued to add Decoster Company residents, retail space was needed beyond Apple Valley Square (1976) Douglas M. Decoster what was available at the local mall. Strip Eberhart Company Brighton Village, New Brighton (1973) centers, which offered tenants greater William Relling Cobblestone Court, Burnsville (1981) visibility and access, became increasingly Har-Mar Inc. Mrs. H.J. Slawik Champlin Plaza (1980) popular. Tenants balked at the high CAM costs in the interior malls, which included Kiddie Koncessions Inc. Cedarvale Mall, Eagan (1966) increased heating, cleaning, and security Norton Lieberman Coon Rapids Family Center Mall (1964) Kraus-Anderson, Inc. costs. At the same time, many fashion (soft Don Robey Galleria, Edina (1974) goods) retailers realized that they needed Lecon Properties, Inc. to be in the large regional malls to Minnesota Valley Mall, Shakopee H. Stanley Wessin compete. Grocers, drug, and discount Minneapolis Star and Northgate Mall, Blaine (1978) stores consolidated and often outgrew their Tribune Company Ridgehaven Mall, Minnetonka (1981) mall locations. They demanded large sites James Marson St. Croix Mall, Stillwater to build their prototypes. Nash Finch Company Norbert P. Asselstine Signal Hills, West St. Paul (1955) By the mid-1980s, indoor community malls Paster Enterprises Southtown, Bloomington (1960) were no longer developed in the Twin Edward J. Paster Cities. Big-box retailers became the Red Owl Stores Valley Creek Mall, Woodbury (1974) essential component of a new community James E. Gottlieb Valley West Mall, Bloomington (1971) shopping center. The Targets and Wal-Marts Regis Beauty Salons, Inc. Myron Kunlan Village Square, Inver Grove Heights (1971) were destinations in and of themselves with V.R. Rooney Enterprises Westview Shopping Center, Hastings (1976) no need to be attached to a mall. V.R. “Pat” Rooney Convenience retail such as quick-serve Zachary Square, Maple Grove (1981) Ryan Properties, Inc. food or dry cleaners could find better Edward C. Ryan These indoor malls were typically parking, visibility, and lower CAM costs in Signal Hills Co. 100,000 – 300,000 sf anchored by grocers, strip centers. Developments such as Maple R.J. Callahan discount retailers, hardware, and/or drug Grove Square Center (1985) and Eagan Super City Inc. of stores. Interior bays were filled with fashion Town Centre (1986) became the new Aberdeen standard with larger anchors, visibility for all Robert P. Larson retailers, barbershops, arcades, pizzerias, Super Valu Stores, Inc. specialty gift shops, dance studios, and tenants, and convenient parking. At the Homer A. Childs movie theaters. The common areas usually same time, these shopping centers no Thorsen & Thorshov, Inc. included space large enough for longer served as a gathering place for the Willard L. Thorsen community events. In addition to the community. Titan Industries “double-loaded” malls with an interior Ronald Blake Some malls were able to adapt and remain walkway, several other shopping centers Trach Properties, Inc. viable, but most were completely “de- were “single-loaded” that included a David B. Trach malled” in order to attract tenants. Charles M. Upham, Jr. climate-controlled walkway between Ownership changes often accompanied Charles M. Upham, Jr. shops. For example, Valley West Mall in an evolving shopping center. While Alvin Weidt Associates Co. Bloomington was originally developed with exceptions exist (notably Kraus-Anderson Donald J. Weidt a climate-controlled walkway. and Paster Enterprises), many times it is not Western Land Corp. Ellsworth L. Johnson until the third owner that a property finds continued on page 3 MSCA Connection January 09 2 msca-online.com President’s Letter ne thing about uncertain times: It makes you appreciate the resources you have all the more. One terrific example is MSCA. As we head into our 21st year, we are 800 members Ostrong, representing over 315 companies and a spectrum of expertise from the Minnesota real estate industry. There is real power in those numbers. With all the questions and challenges we now face, no one has all of the answers; certainly not me. However, in my 15 years with MSCA, I’ve cultivated relationships that offer the reassurance that a lot of answers are just a phone call away. In these increasingly competitive times, MSCA remains a professional, well-informed, fun organization, and we’re all here to help one another. Cindy MacDonald Others from around the country, literally, look to us as an example of a successful trade 2009 MSCA President organization. The MSCA Web site receives hits from all over the United States. We also have hits from India, China, Denmark, Switzerland, Italy, Republic of Seychelles, and the list goes on. The association receives calls from a variety of organizations trying to mirror some aspect of what we do. The resources and networking opportunities offered by MSCA are unique, and priceless. So make the most of your experience here and spread the word about MSCA to your associates. Our goals for 2009 reflect your feedback. We’re expanding services to include six Learning Sessions, which were presented to sell-out crowds in 2008. We will continue to include strong education programs, new member luncheons, enhancements to the newsletter, present networking opportunities and more. We’re also modifying the structure of the Community Enhancement Committee and re-naming it the MSCA Cares Committee as our vehicle for giving back to the community. And, you can also look forward to more successful fundraising Happy events throughout the year to benefit The Caring Tree. Our committees, activities and initiatives would not be possible without the talent and New dedication of our members. We know your commitment to MSCA is in addition to your daily obligations, and we greatly appreciate your investment in this organization. Your efforts really Year! make a difference.