Finding the perfect mix
Special to The Daily Reporter
Financing and design have traditionally stood in the way of developers seeking projects that strike the perfect blend of residential and retail.
But as the concept of a mixed-use development becomes a standard industry practice, municipalities and financial backers for projects are beginning to accept the idea.
“We are seeing more of it all of the time,” said Harvey Rabinowitz, a professor in the School of Architecture and Urban Planning at the University of Wisconsin-Milwaukee. “Mixed-use was a really novel concept 25 years ago, but today developers want to do it.”
It’s a concept, he said, best illustrated by the Bayshore Town Center in Glendale. The $300 million project, which includes 950,000 square feet of retail and 113 apartments, was completed in 2006.
Beau Arnason, executive vice president for Columbus, Ohio-based Steiner + Associates, the developer of the Bayshore Town Center project, said choosing a mixed-use development rather than single-use for Bayshore was an easy decision.
“Think of when you go to a typical retail center that has nothing but retail and has nothing but a parking lot,” he said. “There is nothing really dynamic about that experience.”
Keys to success
Mixed-use succeeds, Rabinowitz said, if the uses of the property are compatible — such as residential and dining — and if those who live in the structure take advantage of the retail.
The projects also succeed if they can get the start-up money, which was not always easy, Rabinowitz said.
Because of the multiple uses, the developments were difficult for banks and investors to define and categorize, he said.
The mixed-use aspect of Bayshore is tied together with a town square, sidewalks, streetscaping and appealing architecture, Arnason said. Those components, however, add to the financial and design hurdles that arise with a project of such magnitude.
“There is definitely a lot that you have to think through carefully, so it is not easy for a retail developer to just jump into mixed-use,” he said. “Our company has been at it for many, many years now, so we’ve learned a lot of things along the way and how to best implement it.”
But even with financial backing, mixed-use developments traditionally faced difficulty gaining design and zoning approvals, primarily in suburban and rural communities, Rabinowitz said. Because urban projects historically were built with retail on the ground floor and apartments or offices above, those municipalities were more likely to grasp the concept.
“Separation of uses was the way zoning used to be done, particularly in the suburbs,” he said. “New zoning emphasizes more mixed-use, emphasizes more density, emphasizes more walkability.”
Another challenge for developers creating mixed-use is deciding what type of retail to bring into the project, Arnason said. While traditional retail — such as clothes and household items — is essential, successful mixed-use developments offer a variety of services, entertainment and experiences.
Meet the neighbors
The challenges that come with mixed-use developments can be even more intimidating when proposing such a project for an existing metropolitan neighborhood. Renee Booker, president and chief executive of the Milwaukee-based North Avenue Community Development Corp., said the key to strong mixed-use projects in urban areas is the vitality and marketability of a particular neighborhood.
Since 1999, the NACDC has overseen the revitalization of an area northwest of Milwaukee’s downtown.
Booker said many of the projects in the area have been single-building, mixed-use developments with retail on the first floor and residential space above.
“In my tenure of being here, we have been pretty successful in leasing up the space in the residential side and getting tenants to come in and be a part of what we are trying to do,” he said. “That is the biggest challenge, creating an environment where business owners will want to come and invest in this corridor.
“It’s not just putting a ‘for rent’ sign in there and saying, ‘Come rent space.’ When I first came, we tried that and that didn’t work.”
Booker and the development corporation built a relationship with community organizers, police and district attorneys. The corporation created a business improvement district, which meets monthly to discuss neighborhood issues, and built a process in which potential retail-space users have access to architectural-design and façade-improvement grants.
All of the efforts target a goal of redefining the neighborhood’s look and feel while increasing the demand for space and the longevity of businesses, Booker said.
“We needed to bring a different kind of energy into the corridor,” he said. “That is when I started looking at: What kind of businesses do we really need?
“The (businesses) that we brought in were from other parts of the city, either their lease was running out, or they were having their challenges and wanted to move to a new environment.”
In the last two years, 16 new businesses have opened and 40 jobs were created along the corridor, Booker said.
“We are trying products people want in the community, not just anything,” he said. “It’s got be things that people want to spend their money on. It’s about building a rapport and a level of confidence with these business owners.”