Sorry if its a repost. I hadn't seen this anywhere else.

Oklahoma City projects stall, look for momentum. via okcBIZ

Pamela A. Grady
5/26/2009 12:00:00 AM


In the Oklahoma City metro area and its surrounding communities, many development projects have been planned, talked about or reported as forthcoming. Looking back, some projects took off and did well, while others never came to fruition, or simply fell off of people’s radar.

OKCBiz takes a look at some of these commercial projects to see whether these deals are moving forward or dead in the water. Simply put, “Whatever happened to that?!?”

Tuscana

THE PLAN: Two years ago, local developer Larry Owsley of RCL Mortgage Corp. purchased 233 acres north of Quail Springs Mall for his Tuscana project, a Mediterranean-style, mixed-use development. He purchased the vacant land with plans to build Oklahoma City’s largest mixed-use destination project. Initially, the plan was to be completed within five to seven years.

THE PROBLEM: “We’ve been pushed back a year or two,” Owsley says, blaming delays on economic circumstances and retailers struggling to find new finance options. “Everybody’s just in slow-motion or holding back until their own financing can get worked out. A lot of their major financing from Wall Street, major investment firms or the REITs have gone away.”

THE PROSPECT: Nonetheless, Owsley says he’s not waiting any longer to begin working on the project’s infrastructure at its ceremonial entrance on May Avenue, where an 18-foot-tall, triple-layered, Tuscany-style fountain will be placed. He says roads are being paved on the Stillwater National Bank-financed project.

“Two years ago, our market feasibility study indicated (Tuscana) would be $700 million to $800 million in bricks and mortar,” he says, but admits the cost may be much higher once all is said and done.

Under the project’s planned unit development, the pedestrian-friendly Tuscana will provide more than 800,000 square feet of retail space, with an emphasis on family recreation.

“Around the perimeters, we have 10 acres on 150th that will be upscale boutique retail,” he says. “On the May Avenue frontage, the area is set up for restaurants with water features and more retail. The concept is everything is driven to the center of the development where the hub of activity will be.”

Additionally, more than 600,000 square feet of residential-size offices and larger corporate structure areas will be available. The project also will feature five to six different styles of residential living, including mid-rise, row homes, townhomes, condominiums and lofts.

“The demographics here in Oklahoma City, in terms of education, number of people, and the income in certain areas of Oklahoma City, is very strong,” Owsley says. “And our development center is in the center of the bull’s eye.”


Quail Springs Ranch

THE PLAN: Local commercial real estate broker Bob Sullivan of NAI Sullivan Group planned for Quail Springs Ranch at Western Avenue and Memorial Road to be a 90-acre, 1.5 million-square-foot, mixed-used project, including The Shops at Highland Park and The Offices at Highland Park, built by Retail Endeavors Group.

THE PROBLEM: Signs onsite indicate the project was to open in summer 2009, but the project has yet to break ground. Sullivan says it has been delayed due to the economy, but only for about 12 months.

THE PROSPECT: “The project is still on track, but with the national slowdown, it’s been pushed back,” he says.

Plans for the site include a 235,965-square-foot anchor, a 65,000-square-foot fitness center, 302,781 square feet of additional retail, 305,300 square feet of commercial offices, a 62,900-square-foot cinema, a 64,917-square-foot entertainment anchor, 23,225 square feet of freestanding restaurants, 243,100 square feet of residential and a 131,400-square-foot hotel. An IMAX theater by Dickinson Theaters is expected as a major tenant, as well as a Legoland theme park and boat rides.


The Outlet Shoppes at Oklahoma City

THE PLAN: In early 2008, Oklahoma City Council members signed a contract to approve $8 million in economic incentives for Horizon Group Properties and Cousins Properties to co-develop Oklahoma City’s first outlet center at Interstate 40 and Council Road, with the understanding that the developers would provide an initial $50 million investment. Depending on the success of the center, another 75,000 square feet could be added later.

The team retained Timberlake Construction as general contractor for its $65 million, 350,000-square-foot retail center, to be called The Outlet Shoppes at Oklahoma City.

THE PROBLEM: Construction was scheduled to begin in November 2008, then was delayed until this spring due to the economy.

THE PROSPECT: Horizon Group Properties Senior Vice President Thomas Rumptz says his group remains cautiously optimistic that construction will begin on the project this summer, with a target completion date of July 2010.

“We have some strong tenants in the marketplace that we’ve worked with and have had in the last 45 to 60 days,” Rumptz says. “So we hope to start construction by the latter part of summer and open by the latter part of 2010. This facility will be similar to our El Paso center (The Outlet Shoppes at El Paso). We built 380,000 square feet of retail in El Paso, and Oklahoma City’s will be 350,000 square feet, but still with 90 retailers on site.”
Despite the current economy, Rumptz says he believes outlets will continue to remain strong in the retail industry.

“If you look at the retail segments right now, the strongest retail segment is the outlet centers,” he says. “And it’s not always that way, so I don’t have the pleasure of saying that all of the time. Most of the retailers that we’re working with have stayed with the outlet project. It’s part of their growth plan, and their corporate success is outlet centers.”

this is good new to me! especially the tuscana project, but i was under the assumption that the imax would be here and not at the other project on the other side of the mall. not that thats important.

I thought that about the Dickinson Theatre as well, fromdust. A mistake, possibly?

OMG at Tuscana
Tuscana

My jaw literally dropped.

I hope it still happens.

Not exactly sure what you are saying. For the record, Tuscana IS the development just north of Quail Springs Mall.

okay, i guess i didnt make it clear. i thought the imax was going to be part of the tuscana project, not the development on the other side of quail.

It's not even on the other side of Quail. It's over there by Western & Memorial.

I see Oklahoma City supporting an outlet mall better than what's been proposed for Tuscana. Folks at Penn Square have told me that retailers like Nordstrom, Tiffany and Co, Nieman Marcus, Saks, etc. aren't interested in OKC because of the demographics. Just look at Macy's......our Macy's aren't real Macy's. They've cheapened them to fit in our market. I don't think a lot of upscale retailers want to tarnish their names like that. I still don't think building an outdoor shopping mall right next to an enclosed indoor shopping mall is a good idea. I'm not opposed to a mixed use development there.

great thats what developers and possible retailers need to read (negativity) that if high end retailers come to okc they will hav to cheapen themselves to fit our okc class lol...

Wow, love your enthusiasm for OKC. I disagree; I believe OKC is more than ready to handle high end retail. OKC should not be saturated with it like Dallas and promote major credit card debt, but we could defiantly handle a few. Tulsa has had a wannabe saks for years, and they are fine.

I agree with you, but what you believe, and what the retailers are actually saying are two different things. Reality is that the high end retailers ARE NOT considering OKC because of our demographics. In regards to Tulsa, if you look at demographics, they're actually better in Tulsa. That's not to say we don't have areas of concentrated wealth in OKC. But, from all of the demographic studies, Tulsa is stronger in this area. Also, Saks is getting dirt cheap rent in Utica Square.

Tulsa Demographics show 1% of population with salaries over 200K. OKC shows 0.6% of population with salaries over 200K.

Of note, Dallas has 1.3% of its population with salaries over 200K. LA and NY have similar results.

Yeah it is unfortanate that our demographics reflect that. We are really spread out in the metro. Hopefully retailers will look closely.

Tulsa:
Avg HH Income $50,270
Median HH Income $35,316
Per Capita Income $21,534


Oklahoma City:
Avg HH income: $43,373
Median HH Income: $31,345
Per capita income: $18,311

Patrick,

Are those figures factoring the whole MSA, or just OKC proper? Can make a difference, especially if you throw in Norman and Edmond, the residents of which would likely travel to a central location if the right high-end retail was there.

Wow, most Macy's that used to be Foley's are not much different than most other Macy's around. We have a brand new one at the new "high-end lifestyle center" (outdoor mall) where I work, it seems no different than the one at Penn Square. This is a two year old Simon lifestyle center (The Domain) with Needless Markups, Tiffany and all the other name brand stores. There is also a planned Nordstrom's and a relocation of Sak's destined for the third phase that was put on hold late last year.

ALL of the Macy's stores that I have been in pale in comparison to the original in NYC.

You need to look at metro numbers, not city numbers (which I presume is what you did.) The city numbers are pretty much worthless for this purpose.

According to the US Census Bureau, 2.6% of households in OKC have income over 200K, compared to 2.5% of Tulsa households.

Again, you need to look at metro numbers. According to the US Census Bureau, as of 2007:

Tulsa metro:
Median HH Income: $43,749
Mean HH Income: $59,075
Per Capita Income: $23,723

OKC Metro:
Median HH Income: $ 43,652
Mean HH Income: $59,937
Per Capita Income: $24,075


(and, btw, not sure where you got your numbers, but they don't agree with the Census Bureau's city numbers either)

Yea...it doesn't even feel like the same company.

tradin' on the presump, and hopin' the sheeple don't notice. Seems to be workin' by and large.

Actually, Oklahoma City MSA's per capita income is $38,834 in 2007 according to the Bureau of Economic Analysis. In Tulsa, the per capita income was $41,307. Dallas-Ft. Worth's per capita income in 2007 is $40,893.

However, Oklahoma City is outpacing both Tulsa and Dallas in per capita income growth.

Patrick, while demographics do play a role in what stores locate to a metro area, I still have a hard time believing Tulsa is THAT much stronger. According to my sources. Oklahoma City alone... not including Edmond, Nichols Hills and Norman... has 3,048 people that make more that $200K a year. Tulsa alone... not including Owasso, Jenks and Broken Arrow... has 3,862 people that make more than $200K a year.

Now, lets take a closer look at the 'burbs for both cities...

Individuals making more than $200K per year in...

Edmond - 1,017
Nichols Hills - 378
Norman - 675
Total including OKC - 5,118

Broken Arrow - 351
Jenks - 50
Owasso - 33
Total including Tulsa - 4,296

Please understand, I am not saying you are wrong Patrick. Tulsa no doubt has good demographics, percentage-wise. But Oklahoma City's tangible numbers are getting overlooked. If these retailers are looking at solely Oklahoma City and not the suburbs, therein lies our problem. Anyone in Oklahoma City and Edmond knows that Edmondites do the bulk of their weekend shopping in Oklahoma City (when they are not in Dallas, mind you). And given the geography of those demographics, between Nichols Hills, the Quail Springs Region and Edmond, and there is a lot of missed opportunity. Why?

Those figures above are based on the 2000 census as well. Given the growth in per capita income over the last eight years, OKC's demographics have gotten stronger. So I fail to see why OKC is getting overlooked. If it were 1995, I can understand why. But with the major presence of two energy companies, not to mention the gradual influx of bio-tech jobs and the full recovery from the oil bust 11 years ago, this is why I am such a strong ambassador for OKC.

I value your opinion, Patrick, so what are your thoughts?

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I think at this point in the game, Tulsa and OKC are pretty equal. That's why we're getting similar retailers, NOW. But, you have to remember, Saks has been in Utica Square a long time.......and things were different back when they located there. OKC has moved up some in regards to per capita income, but in regards to Tulsa, as oil companies have left the former oil capital, I think what we've seen more is Tulsa go down in comparison to say 30-40 years ago......factoring in inflation of course. So, maybe Tulsa at one time was ahead of OKC in per capita income, but times have changed.

I think a lot of it has to due with population density too. You tend to see more upscale retailers in larger metro areas. We're just not there yet. And you're seeing it in faster growing cities like Austin and Albuqurque before you're seeing it here. Our growth rate just isn't as large as some of these other cities.

Interesting that the BEA numbers are so different from the Census Bureau numbers. Any idea why? (FWIW, the BEA numbers show the Houston metro (where I believe you live) with a Per capita income of $46,471)

im more exctied about the new outlet mall being built right up the street with stuff I can afford to buy then that stuff up in edmond with stuff I can afford to look at