Developer Turns Small Mixed-use Projects to Fill Shopping Center Void

By Corina Vanek, Phoenix Business Journal (Jan 24, 2019) – Reprinted with permission

As large-scale malls and shopping centers have been in decline in recent years, developers are turning to small-scale, mixed-use developments to fill a niche.

“People still want the experience for retail, but we can’t do it on that scale,” said David Sellers, CEO of Phoenix-based LGE Design Build.

LGE has opened locally oriented commercial developments in Gilbert, Chandler and Tempe, and are working on two in Scottsdale.

The typical tenant mix for one of LGE’s smaller projects are mostly food and beverage, fitness and niche retail. The projects have reached between 80 and 100 percent leased, Sellers said.

“In Phoenix, you don’t really have much choice,” Sellers said. “You either go to a mall or you go to a strip center. We are taking projects like the Biltmore and Kierland and doing them on a smaller scale.”

Sellers said the company has gotten “really good feedback” and continued tenant inquiries about its neighborhood developments. Lou Malnati’s has opened its second Arizona location in LGE’s $25 million Chauncey Lane development in Scottsdale.

Luci’s Healthy Marketplace will open its second location at The Grove, LGE’s mixed-use project in the McCormick Ranch neighborhood of Scottsdale. The project, which is an adaptive reuse of a church, will include Reformed Pilates and Obon Sushi + Bar + Ramen.

Chauncey Lane and The Grove include office space, which Sellers said was a necessary component for LGE’s projects.

“When you put the office there, it’s a different investment profile,” he said.

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